The Carolinas Prove Hot Spots For Retailers
by Kristen Cloud/staff writer
Retail accounts for one in four jobs in the Carolinas. It’s the largest employer in South Carolina and the largest private employer in North Carolina.
The U.S. Bureau of Labor Statistics reported in mid-September that Raleigh tops all U.S. markets for retail growth. The area saw a 7.60 percentage change in the number of retail trade jobs between 2007 and this year. Raleigh boasted approximately 57,900 such jobs in July 2007 and upped that number to 62,300 in July 2012. In addition, census data shows that Charlotte is the fastest growing area in the country.
Though the states’ economies are relatively flat and their unemployment rates rest at 9.6 percent, above the national rate of 8.1 percent, these promising facts and statistics are a sign that “things are going in the right direction,” Lindsey R. Kueffner told The Shelby Report.
“Like the rest of the country, the economy is improving in North and South Carolina,” said Kueffner, who serves as the executive director of the Carolinas Food Industry Council (CFIC). “It’s just happening slowly.”
Charlotte’s ‘grocery wars’ intensify
As Charlotte’s population booms, so does grocers’ interest in the already retail-saturated market.
Publix announced Sept. 19 that it plans to open a store in Greater Charlotte, in Ballantyne (see front page story). It will be the Florida-based chain’s first store in North Carolina and the northernmost store.
In August, Whole Foods opened its first store in Charlotte at 6610 Fairview Rd. in the SouthPark neighborhood.
The 42,000-s.f. store reportedly cost more than $12 million to build.
Competition from these industry heavy-hitters and others have sparked an “up-the-ante” attitude among grocers, especially those for whom North Carolina is their headquarters.
Salisbury-based Food Lion, owned by Delhaize America, cut 29 jobs at its corporate offices in September.
The reduction ties in with a new brand strategy Food Lion has implemented at more than 700 stores in the Carolinas, Virginia and West Virginia—efforts Food Lion has been making in reducing prices in stores, operating more efficiently and repositioning the company for future success, salisburypost.com reports.
The new strategy encompasses lower prices, more convenience, improved service, greater value in private brands and better produce, and the company has been adding jobs at the retail level.
“…Company officials have said there that many of those (29) employees whose jobs are being eliminated will be offered other positions within the company,” Kueffner said.
In January, Delhaize America closed 113 under-performing Food Lion stores, pulled out of Florida and retired the Bloom banner. In all, about 4,900 jobs were cut at that time, and Food Lion accelerated the rollout of its new brand strategy.
Delhaize America officials told salisburypost.com in late August that comparable-store sales at repositioned Food Lion stores have improved by more than 3 percent—evidence that the strategy is working.
The repositioning is about 62 percent complete.
Food Lion has more than 500 stores in North Carolina alone, where it employs 31,000 people. It has 1,127 stores and 58,000 employees overall.
Earlier this year, Matthews-based Harris Teeter and Winston-Salem-based Lowe’s Food Stores swapped 16 stores with each other. The move resulted in Lowe’s exit from Charlotte and a consolidation of Harris Teeter’s position.
On Sept. 17, Harris Teeter said it would open two stores under the new 201central banner that will feature a variety of wine, beer, specialty foods and general merchandise items. These stores are being branded 201central in reference to one of the original Harris Food Stores, Store No. 201, on Central Avenue in Charlotte. Store No. 201 was the first full-service supermarket in Charlotte, the first air-conditioned grocery store and the first to stay open until 9 p.m. on Friday.
The stores being renovated to the 201central format are located at 13108 Eastfield Rd. in Huntersville and 5939 Weddington-Monroe Rd. in Wesley Chapel. They each will be approximately 30,000 s.f. and carry more than 3,100 varieties of wine and more than 680 varieties of beer from around the world. Harris Teeter officials also note the format will include: cigars, specialty cheese and olives, artisan breads, bulk foods including coffee, tea, nuts, grains and rice, as well as other specialty and common favorites of beverages and snack items, including gluten-free products. The stores also will feature in-store wine consultants, event coordination and catering as well as party rentals and classes on wine, beer and food pairings. Opening dates for the stores have not been announced.
“The world’s becoming a smaller place for everybody, not just grocery retailers but all retailers and in every industry,” Kueffner said of the ever-increasing competition. “Everybody’s having to adapt to a changing marketplace; grocery retailers are having to look at what sets them apart from other retailers and really leverage that in a way that keeps them competitive.”
Harris Teeter, which is rebuilding or renovating some of its Charlotte stores, is the market’s dominant traditional grocer, but last year it and other grocers were bested by Walmart as the No. 1 grocery retailer in the region based on store market share.
Walmart expands, tests in North Carolina
Walmart continues to expand in the Carolinas, and especially in the Tar Heel State.
The Bentonville, Ark.-based retailer plans to open a second Neighborhood Market store in the Triangle region at a shopping center in Morrisville after it opens its first Neighborhood Market store in Cary in October.
According to the Triangle Business Journal, Walmart will open its mid-size Morrisville Neighborhood Market format store in a 45,000-s.f. space at the Morrisville Market shopping center at 3560 David Dr. The store will carry a mix of grocery items and general merchandise and will feature a drive-thru pharmacy. The project will cost about $6 million to build. Walmart will take over the space currently occupied by Ace Town & Country Hardware at Morrisville Market.
The Journal reports that Walmart also plans to open its first Walmart Express format store in the Triangle region with a 12,000-s.f. store in Johnston County’s Four Oaks community. The Express store, which will cost about $2 million to build, will have both a pharmacy and a gas station and is slated to open in early 2013.
Walmart currently has 10 Express stores open in the test phase, including five in North Carolina, three in Arkansas and two in Chicago. The company also has announced plans to build new Express stores in seven other North Carolina communities, including Carthage, Liberty, Pikeville, Stedman, Red Springs, Benson and Eastover.
Walmart’s newer formats, as well as dollar and drug stores that are carrying more grocery items on their aisles, is among the challenges being faced by the traditional grocer.
“Multiple channels of competition, new format stores, direct from the manufacturer, and shoppers becoming more educated to help their dollars go further—those are some of the biggest challenges at the moment,” Kueffner said.
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