Last updated on August 16th, 2012 at 12:08 pm[gn_note color=”#6666ff”]The 2011 South Florida Profile originally ran in the March 2011 edition of The Shelby Report of the Southeast. Due to reader requests we will be posting our Profiles from each edition of The Shelby Report. The profile will be published on theshelbyreport.com one month after it has run in print.[/gn_note]
by Katie B. Davis/staff writer
Deep concerns about prolonged economic hard times have Floridians in a “lingering funk,” noted a press release for a Nielsen Co. poll that surveyed 1,220 Floridians in January.
The annual Leadership Florida poll found 45 percent of residents believe the state is worse off than it was five years ago, and 65 percent say things will stay the same or get worse in the next five years, reports the South Florida Business Journal.
“The public is very weary of the slow economic recovery and the high frustration level of Floridians is impacting their opinion of government at every level,” said Susan A. MacManus, professor of public administration and political science at the University of South Florida, in the press release. “At the same time, people have an expectation of what they want the governor and the legislature to do: to create jobs and remove major barriers to doing business in the state of Florida. They also see education, especially good teachers, as vital to Florida’s economic future.”
More than half, 52 percent, of all Floridians identify jobs and the economy as the most important issue facing the state. Meanwhile, 55 percent say the state is doing poorly at creating new jobs, the highest number since Leadership Florida began its tracking poll in 2008.
For the better part of a year and a half, the Sunshine State has been devastated by an unemployment rate topping 10 percent—as of December 2010 it stood at 11.6 percent, according to the U.S. Bureau of Labor Statistics.
South Florida with all of its perceived Boca Raton and South Beach glitz and glamour hasn’t been the exception. In fact, in all but the Naples and Marco Island region, which stands at 11.5 percent, the South Florida region has exceeded the state’s average unemployment figures.
The Port St. Lucie, Miami, Miami Beach and Kendall areas along with the Sebastian-Vero Beach area each have an unemployment rate above 13 percent, while the Tampa-St. Petersburg-Clearwater area, the Cape Coral-Fort Myers area, Punta Gorda and the Lakeland-Winter Haven area exceed 12 percent unemployment.
“In recent reports, Florida has 1.1 million people out of work, and South Florida in particular has taken the heaviest toll,” Mike Stout, director of new business development at Save-A-Lot Food Stores, told The Shelby Report.
Save-A-Lot has 129 stores in the state of Florida, 20 of which opened in the company’s most recent fiscal year.
“The job losses have mounted in that area as the recession battered the state’s construction and real estate industries. The high unemployment was clearly evident when our licensee, Kim Walker, began hiring for an upcoming opening of his first location in Lehigh Acres,” Stout said. “Over 1,000 candidates stood in line hoping to be hired for one of the 25 hourly positions.”
On the upside, Florida’s economic outlook ranks fifth among the 50 U.S. states, according to the latest edition of an annual study by the American Legislative Exchange Council, reports the South Florida Business Journal.
The 2010 “Rich States, Poor States” study presents state economic outlook rankings based on public policies that have a proven impact on growth, revealing which states have the best chance of experiencing economic recovery and which need to re-examine their policies before they can expect to see improvement.
The economy of South Florida, especially in the Boca Raton area, is on the rise, according to The Palm Beach County Convention and Visitors Bureau (CVB).
Led by hospitality and retail positions in Boca Raton, Palm Beach County has had the strongest job growth of any of Florida’s 22 metro areas, adding 6,900 jobs between December 2009 and December 2010—that’s more than twice the state’s growth rate, according to the CVB.
Trend toward healthier fare
Walmart is expanding its focus beyond lower prices to include healthier food, and according to a report in the Sun-Sentinel, “that could make a big difference for grocery shoppers—even in South Florida.”
Walmart dominates the national market, but in South Florida it’s No. 3 in grocery sales. Publix Super Markets, the state’s largest grocer, is the market leader with a 50 percent share, and Winn-Dixie ranks second with 11 percent, according to 2010 data from the Nielsen Co.
Though it might seem that the effect of Walmart’s initiative will be diminished in South Florida, Charles Fishman, author of “The Wal-Mart Effect,” told the Sun-Sentinel that won’t be the case.
“Publix is not going to let its house brand be out-competed by Walmart’s house brand,” Fishman said to the paper. “Publix shoppers who would not go to Walmart end up benefiting from Walmart’s decisions. Everyone else will have to find ways to do it as well, at least in the foreseeable future, because no one wants to be left behind.”
And clearly that was the mentality of the executives at Walmart when the decision was made to offer healthier fare, because they are a little behind.
Publix Greenwise Market Stores, in Palm Beach Gardens, Boca Raton and Tampa, already feature organic, all natural and Earth-friendly products. Greenwise brand products, along with other natural and organic items, also are found at regular Publix stores, and Publix Nutrition Facts shelf tags are near the price tags of products such as cereal and frozen foods.
In other Publix news from South Florida, Publix Curbside, a test of online grocery ordering and at store pickup, will launch in the near future at store No. 0754 at Shoppes of Citrus Park at 7835 Gunn Hwy. in Tampa.
Publix customers will place their orders online by visiting publix.com/curbside. Once on the site, customers will select their desired pickup location, specified 30-minute pickup window and proceed with order placement. Customers will see an estimated total, as weights for produce, meat and deli items will fluctuate. Sale prices for the store that are effective the day of pickup will be honored. Payment is tendered at the time of pickup. No minimum order amount is required and a $7.99 service fee per Curbside order will be added to the total. As an introductory incentive, the $7.99 service fee is waived for first-time users. The site will allow for multiple shopping lists to be saved under the customer sign-in for subsequent purchases.
Similar to Publix Curbside and on the healthier foods note is a program in place at Whole Foods.
There’s a growing group in South Florida embracing Community Supported Agriculture (CSAs). For $20 to $40 a week, consumers buy ultra-fresh food straight from the farm at prices similar to the grocery store. And their contribution helps small farmers remain in business, reports the Sun-Sentinel.
While the CSA concept historically has cut the grocery store out of the equation, Whole Foods stores in Florida are aiming to change that. The chain is kicking off a program to offer local farms free use of Whole Foods stores throughout the state as drop-off and pick-up points for the weekly deliveries.
Whole Foods—which began testing the idea in late 2010 at five Florida stores with two farms—is now ready to roll it out as a long-term program across the state. Any farm can participate as long as the store has room to hold the boxes.
Russ Benblatt, spokesman for Whole Foods in Florida, told the Sun-Sentinel that the program is a natural extension of the chain’s efforts to support local agriculture. Each Whole Foods store already tries to ensure that at least 20 percent to 30 percent of the produce is sourced locally.
The drawback is that CSA customers can’t order what they like. The farmer gives them what is fresh that week. But the upside is that often the produce the consumer is given came out of the ground only a day before they pick it up and it may inspire them to learn how to cook and eat fruits and vegetables they may never have tried before.
Growth potential and potential realized
In the state of Florida, Save-A-Lot’s 129 stores consist of 102 corporate and 27 independent licensees, located primarily in central part of the state. Florida is Save-A-Lot’s largest market in terms of store count, and there are aggressive plans to continue corporate and license development in the state.
According to Save-A-Lot’s Stout, “South Florida is a relatively untapped market for Save-A-Lot, and we are actively seeking retailers who may have an interest in store ownership.
“Overall, the state of Florida plays a huge part in our future growth plans,” he added.
Save-A-Lot, one of the nation’s leading extreme value and carefully selected assortment grocery chains operating more than 1,200 value-oriented stores in all types of neighborhoods, recently opened two new stores in South Florida: one at 5015 Gulfport Blvd. in Gulfport on Oct. 28, and one at 3257 Cleveland Ave. in Ft. Myers on Jan. 4.
Each brought approximately 20-25 jobs to its respective area.
Save-A-Lot also opened in St. Petersburg at 2800 34th St. North.
“Fortunately, Save-A-Lot’s business model and format have allowed us to expand even during a tough recession,” Stout told The Shelby Report. “We have done an excellent job in positioning ourselves as a leader in the hard discount, value-oriented segment.
“The traditional supermarkets of 30,000 s.f. or larger is at a point of saturation in Florida. The industry is already seeing the trends of going towards an edited assortment, smaller footprint grocery store.
“Save-A-Lot has spent the last 30 years in examining, simplifying and improving our stores, which has resulted in a better customer experience and successful business model. Our format is well suited for opening in underserved areas, where many of our competitors will not go,” he said.
In honor of the new stores and to demonstrate the company’s commitment as a community partner in St. Petersburg and Gulfport, Save-A-Lot donated $5,000 in gift cards to Feeding America Tampa Bay, which provides food, grocery and household products to families in need in St. Petersburg and Gulfport and throughout the greater metropolitan area.
“Save-A-Lot’s dedication to the communities that it serves bodes well for the future as the movement to eliminate ‘food deserts’ takes hold,” Stout said. “(Our) stores often host events and provide sponsorships and offer job opportunities for local residents, which helps to stabilize and revitalize communities that are neglected by other grocery chains.”
Stout added that growth is his company’s greatest opportunity in the South Florida market, stating that Florida is the fourth most populous state in the U.S. and, “we believe we can open 100-plus locations over the next five years.
“The state is highly competitive, and direct competitors such as Aldi are aggressively pursuing development in Florida,” he continued. “In addition, your dollar stores such as Dollar General and Family Dollar are expanding as well. It will be critical that we distinguish ourselves from our competitors.”
Stout noted that what he thinks Save-A-Lot has done best compared to its competitors is stocking the most frequently purchased grocery items in the most frequently purchased sizes, “making our stores smaller, easier to navigate and operationally more efficient.
“On average, we have less than 2,000 SKUs per store. Fewer SKUs allows for much greater efficiency, higher velocity and lower prices for our customers,” he said. “For fiscal year 2011, Save-A-Lot will be courting budget-minded consumers even more aggressively with a new line of smaller packages at even lower prices. Our cereal, for example, is a great value at $1.79 to $1.99. We are also coming out with a slightly smaller package that is 99 cents. It is a great value for under a dollar. We plan on adding new smaller packaged products in Save-A-Lot stores by this spring,” Stout added.
Known for its premium Aldi select brands, the discount grocery chain is able to offer high-quality grocery items at what the company terms “unbeatable prices.”
Aldi also planned two job fairs this year, Feb. 18 and Feb. 21, to hire manager trainees and cashiers for its new stores in Tamarac, Delray Beach, Westchester, Miami Gardens and Cutler Bay.
The grocer also was looking to hire staff for recently opened stores in Deerfield Beach, Pembroke Pines and Lauderdale Lakes.
The Fresh Market, which already has 17 stores in Florida including 10 in South Florida—Naples, Pembroke Pines, Coral Springs, Boca Raton, Sarasota, Clearwater, Aventura, Bonita Springs, Coconut Grove and Ft. Myers—is adding seven new stores in the South Florida region.
The new locations are 1800 West Ave., South Miami Beach; 20409 S. State Road 7 in West Boca Raton; 2900 4th St. North in St. Petersburg; 12147 N. Dale Mabry Hwy. and 3722 Henderson Blvd. in Tampa; and 526 21st St. in Vero Beach.
Publix opened a new 45,600-s.f. store at Hays Road Town Center in Hudson in Pasco County on Feb. 3.
During Winn-Dixie’s second quarter conference call in February, Winn-Dixie’s chairman, president and CEO Peter Lynch, said the level of migration of “snowbirds” to Florida from northern states is probably about the same as last year.
“I think I was a little more optimistic maybe a quarter before, but I haven’t heard of any real heavy doses that snowbird is coming back,” said Lynch.
For the quarter that ended Jan. 12, net sales were $2.1 billion—essentially flat compared to the same period the prior year. Identical store sales decreased 0.3 percent vs. the previous year, Winn-Dixie said, noting that sales were negatively impacted by competitive activity and the continued mix shift from branded pharmaceutical to generic products. These decreases were partially offset by “inflationary price increases that were passed through in selected categories and an increase in sales in remodeled stores,” the chain said.
And the remodeling program is continuing. Winn-Dixie anticipates spending about $63 million on the store remodeling program. It expects to complete a total of five traditional store remodels and two “transformational” remodels in fiscal 2011. The remaining 15 transformational stores that were originally scheduled to be completed in fiscal 2011 are expected to be completed in the first half of fiscal 2012.