A homegrown heavyweight is taking on Whole Foods Market and T & T’s Osaka Supermarket in a battle for the grocery dollar in West Vancouver.
H.Y. Louie Co. opens its new concept supermarket, Fresh St. Market, on Wednesday. The store, which replaces a Safeway and emphasizes locally sourced and organic fresh meat, seafood, cheese and produce, is continuing evidence of the growing consumer shift toward healthy eating and a foodie culture.
It is located at 17th and Marine Drive.
“We feel there is a change in how people are buying food,” said Mark McCurdy, H.Y. Louie’s director of marketing. Shoppers are now more likely to buy fresh, healthy food several times a week rather than shop weekly. They are seeking a pleasant, more social shopping experience, he said.
“You either go low-end, no frills, or you give customers great experience,” McCurdy said. “We wanted to create a grocery store that creates its own niche through a high-service culture that offers top of the line products in an atmosphere of discovery and exploration where new, authentic, organic and exclusively sourced becomes everyday shopping at affordable prices.”
The store is a pilot project for a new supermarket chain, McCurdy said.
The H.Y. Louie group is B.C.’s second largest private company after Jim Pattison’s holdings and includes London Drugs, the IGA grocery franchise in B.C., and a wholesale division that supplies independent B.C. grocery stores. Family patriarch H.Y. Louie opened his first, small, general store in Chinatown in 1903 — when Chinese Canadians were 44 years away from getting the vote. Grandson Brandt Louie now runs the family empire.
As a concept, the 28,000-sq.-ft. Fresh St. Market is sounding all the right notes.
“There’s no secret to the trends. It’s all about health,” said food industry expert David Lam, a Deloitte partner in mid-market corporate finance.
Across North America, the food business is getting tougher. Food retailers must now compete with stores such as Walmart, Costco, Canadian Tire, Shoppers Drug Mart, 7-Eleven and London Drugs, Lam said. The divide is increasing between low-end stores such as Buy-Low and PriceSmart and the higher-end stores such as Overwaitea’s Urban Fare and Whole Foods, which sell freshness and service.
Grocery stores need to reassess their priority customer targets, analyst John Chan wrote in October’s Canadian Grocer. Families with children are declining in importance. In the 2011 census, for the first time, one-person households outnumbered couple households with children under 24. At the same time, male-led single-parent families are outpacing female-led single-parent families and men are emerging as the principal grocery shopper, Chan said.
Aging consumers entering new life stages are also likely to reappraise their brand choices, Chan said. Higher inventory levels and price competition is no longer going to be profitable or drive growth. A distinct point of difference will work better in today’s crowded marketplace, he said.
Large retailers such as Loblaw, which bought T & T in 2009, and the Pattison group are increasingly running several store formats. “The food business is all about looking at slivers or fragmentation of the marketplace,” Lam said. “So you really have to define your point of differentiation and get really narrow, which means you can’t play scale. Fresh St. can’t be a massive store.”
While traditional supermarkets stock 70 per cent of the store with groceries (including detergent, paper towels, canned goods, frozen foods) and 30 per cent with fresh food, Fresh St. Market has a 60/40 mix, McCurdy said.
Instead of a traditional “centre of store” grocery section surrounded by fresh food around the store perimeter, Fresh St. Market is set up almost as two stores side by side, with the grocery section playing second fiddle to large, splashy fresh food sections.
Devoting such a high percentage of product to fresh food is risky, but McCurdy points to the company’s extensive grocery and retail background.
“Fresh food is risky,” McCurdy acknowledged. “You’ve got to get it right. We have the right price point.”
The store stocks only Ocean Wise seafood, one third of the cheese section is B.C. product, 20 per cent of groceries are B.C. sourced and produce will range from 20 per cent to more than 50 per cent in the summer. Some of the cheese is made exclusively for the store, which also has a large organic offering.
“I think the strategy is actually a good one,” Lam said. H.Y. Louie is a Deloitte customer.
“Also in the context of practical opportunity, the space became available and they wanted to fill it. They know the food, they have retail experience, they have buying experience. It’s just a different concept.”
The choice of West Vancouver was partly chance. H.Y. Louie had owned the property and leased it to Safeway for 15 years. The company’s plans for a retail and tower development fell through a couple of years ago.
The store expects to use social media to tell shoppers when the salmon runs come in or when the fresh corn has just arrived from Chilliwack, McCurdy said.
IGA is a traditional grocery store format, with most stores coming in under 20,000 square feet. The larger stores such as Save-On-Foods may run to 50,000 square feet.
jennylee@vancouversun.com
Blog: vancouversun.com/smallbusiness
H.Y. Louie Co. opens its new concept supermarket, Fresh St. Market, on Wednesday. The store, which replaces a Safeway and emphasizes locally sourced and organic fresh meat, seafood, cheese and produce, is continuing evidence of the growing consumer shift toward healthy eating and a foodie culture.
It is located at 17th and Marine Drive.
“We feel there is a change in how people are buying food,” said Mark McCurdy, H.Y. Louie’s director of marketing. Shoppers are now more likely to buy fresh, healthy food several times a week rather than shop weekly. They are seeking a pleasant, more social shopping experience, he said.
“You either go low-end, no frills, or you give customers great experience,” McCurdy said. “We wanted to create a grocery store that creates its own niche through a high-service culture that offers top of the line products in an atmosphere of discovery and exploration where new, authentic, organic and exclusively sourced becomes everyday shopping at affordable prices.”
The store is a pilot project for a new supermarket chain, McCurdy said.
The H.Y. Louie group is B.C.’s second largest private company after Jim Pattison’s holdings and includes London Drugs, the IGA grocery franchise in B.C., and a wholesale division that supplies independent B.C. grocery stores. Family patriarch H.Y. Louie opened his first, small, general store in Chinatown in 1903 — when Chinese Canadians were 44 years away from getting the vote. Grandson Brandt Louie now runs the family empire.
As a concept, the 28,000-sq.-ft. Fresh St. Market is sounding all the right notes.
“There’s no secret to the trends. It’s all about health,” said food industry expert David Lam, a Deloitte partner in mid-market corporate finance.
Across North America, the food business is getting tougher. Food retailers must now compete with stores such as Walmart, Costco, Canadian Tire, Shoppers Drug Mart, 7-Eleven and London Drugs, Lam said. The divide is increasing between low-end stores such as Buy-Low and PriceSmart and the higher-end stores such as Overwaitea’s Urban Fare and Whole Foods, which sell freshness and service.
Grocery stores need to reassess their priority customer targets, analyst John Chan wrote in October’s Canadian Grocer. Families with children are declining in importance. In the 2011 census, for the first time, one-person households outnumbered couple households with children under 24. At the same time, male-led single-parent families are outpacing female-led single-parent families and men are emerging as the principal grocery shopper, Chan said.
Aging consumers entering new life stages are also likely to reappraise their brand choices, Chan said. Higher inventory levels and price competition is no longer going to be profitable or drive growth. A distinct point of difference will work better in today’s crowded marketplace, he said.
Large retailers such as Loblaw, which bought T & T in 2009, and the Pattison group are increasingly running several store formats. “The food business is all about looking at slivers or fragmentation of the marketplace,” Lam said. “So you really have to define your point of differentiation and get really narrow, which means you can’t play scale. Fresh St. can’t be a massive store.”
While traditional supermarkets stock 70 per cent of the store with groceries (including detergent, paper towels, canned goods, frozen foods) and 30 per cent with fresh food, Fresh St. Market has a 60/40 mix, McCurdy said.
Instead of a traditional “centre of store” grocery section surrounded by fresh food around the store perimeter, Fresh St. Market is set up almost as two stores side by side, with the grocery section playing second fiddle to large, splashy fresh food sections.
Devoting such a high percentage of product to fresh food is risky, but McCurdy points to the company’s extensive grocery and retail background.
“Fresh food is risky,” McCurdy acknowledged. “You’ve got to get it right. We have the right price point.”
The store stocks only Ocean Wise seafood, one third of the cheese section is B.C. product, 20 per cent of groceries are B.C. sourced and produce will range from 20 per cent to more than 50 per cent in the summer. Some of the cheese is made exclusively for the store, which also has a large organic offering.
“I think the strategy is actually a good one,” Lam said. H.Y. Louie is a Deloitte customer.
“Also in the context of practical opportunity, the space became available and they wanted to fill it. They know the food, they have retail experience, they have buying experience. It’s just a different concept.”
The choice of West Vancouver was partly chance. H.Y. Louie had owned the property and leased it to Safeway for 15 years. The company’s plans for a retail and tower development fell through a couple of years ago.
The store expects to use social media to tell shoppers when the salmon runs come in or when the fresh corn has just arrived from Chilliwack, McCurdy said.
IGA is a traditional grocery store format, with most stores coming in under 20,000 square feet. The larger stores such as Save-On-Foods may run to 50,000 square feet.
jennylee@vancouversun.com
Blog: vancouversun.com/smallbusiness
Read more: http://www.vancouversun.com/business/agriculture/concept+supermarket+Fresh+Market+takes+Whole+Foods/7792291/story.html#ixzz2HSoVYjGG
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