Last updated on September 21st, 2012 at 11:20 am[gn_note color=”#b1cbde”]The 2012 Rhode Island Profile originally ran in the August 2012 edition of The Shelby Report of the Northeast. The profile will be published on theshelbyreport.com one month after it has run in print.[/gn_note]
by Kristen Cloud/staff writer
The Rhode Island economy continues to suffer. With unemployment still hovering around 11 percent, the Ocean State’s jobless rate is among the worst in the country.
The economic uncertainty has forced consumers to adjust their spending patterns and, not surprisingly, caused many retailers to offer value-type programs.
“(The high unemployment), that’s been going on for almost three years,” Rhode Island Food Dealers Association (RIFDA) President and CEO Steve Arthurs tells The Shelby Report. “As a retailer, it certainly affects your business.”
The impact to the Rhode Island food retail industry is far-reaching, as the segment as a whole is the third-biggest employer in the state.
Retailers, specifically, are looking at “different ways of marketing to the consumer,” Arthurs adds
These marketing efforts may be credited at least partly for the fact that, though a number of retailers are struggling, there have been no significant closings recently, according to Arthurs.
In fact, both Stop & Shop and Dave’s Marketplace each have opened stores in the past year.
Stop & Shop opened its third location in Cranston in September and Dave’s Marketplace—Rhode Island’s largest independent grocer—opened its ninth store late last year at 23 Coventry Shoppers Park in Coventry.
“Both those stores are doing really well,” Arthurs says.
Dave’s, which has approximately 1,350 employees companywide, also recently completed an expansive remodel of its 32,000-s.f. flagship store at 1000 Division St. in East Greenwich.
Bill Hogan, GM at Dave’s Marketplace, says remodeling is an area where Dave’s separates itself from its competition—which includes fellow independents, big boxes like Walmart and Target, drugstores such as CVS whose headquarters is in Woonsocket as well as specialty grocers and club stores.
“We try to give people a nice visual—something to look at when they come in,” Hogan says. “So that, every corner they’re turning, there’s something to look at, something that’s appealing.”
This includes décor as well as lighting and flooring elements.
“But,” adds Hogan, “you’ve got to spend money and, in this business, you can’t stop. You can’t stand still. I think that’s why we’ve been successful.”
Dave’s also caters its stores to their respective neighborhoods in order to enhance the shopping experience, according to Hogan.
For example, CIP Retail—a firm specializing in supermarket design, patterned the remodeled Dave’s store in East Greenwich to correspond with the upscale community’s downtown Main Street area that borders the water.
“We want to give people a nice, warm feeling when they take every single turn in the store,” Hogan says. “That’s what you want to do with people.
“It’s such a chore to go shopping, and that’s not the customer we have. We’re fortunate, we have the customer who really does appreciate food, appreciates that kind of thing—who comes in and takes their time.”
Pushing perishables, prepared foods
How to appeal to the consumer is the big question for retailers in the current economy, according to Arthurs.
“One of the other opportunities that retailers are looking at is, since the consumer is already coming in the store, how do they increase those customers’ order sizes.
“So there’s been a number of campaigns from a marketing perspective that have been geared to that,” Arthurs says. “…how to get them to spend more because, you may not get more shoppers, but if you can get the average shopper to increase their order by 10 percent, then you’ve all of a sudden went from flat sales to being up—a measurable improvement.”
Dave’s takes a variation of this approach by, as Hogan says, “pushing perishables.”
Hogan estimates that about 60 percent of Dave’s business comes from the company’s perishables department.
“There’s a major emphasis on that,” he says. “That’s why people come into our stores … We’ve always had a passion for perishables and, believe me, it’s been our saving grace.”
In addition to perishables, Dave’s advances its fresh foods focus further in the prepared foods arena. The company’s kitchen/deli makes up about 20 percent of the business, according to Hogan.
“You don’t necessarily really have to discount,” he says. “You just have to shine in those areas.
“And you always have to come up with new things, new ventures—things that people get excited about and make them talk about you.”