THE VIRGINIAN-PILOT
Copyright (c) 1995, Landmark Communications, Inc.
DATE: Friday, June 9, 1995 TAG: 9506090573
SECTION: BUSINESS PAGE: D1 EDITION: FINAL
SOURCE: BY STEPHANIE STOUGHTON, STAFF WRITER
LENGTH: Medium: 82 lines
Food wars continue to heat up as several supermarket chains new to the area jockey for a larger slice of the Hampton Roads' grocery bill.
Farm Fresh Inc. continues to be No. 1 and has even gained slightly on its competitors.
Farm Fresh has widened its lead over Food Lion in the Hampton Roads market, but lost a small piece of the Richmond pie, according to an industry publication.
``With a new Winn-Dixie, two new Food Lions and a new Farmer Jack - I am pleased with us being able to grow market share,'' said Michael E. Julian, Farm Fresh president, chairman and chief executive.
Farm Fresh debuted two grocery stores in this area while rivals introduced four.
While Farm Fresh's market share rose slightly to 39.31 percent in Hampton Roads, No. 2 Food Lion inched backward to 35.78 percent, according to the June issue of Food World, a Columbia, Md.-based publication.
A Food Lion spokeswoman said the small decline was largely insignificant, merely a normal fluctuation in a competitive market.
Food World's ratings, which cover mid-Atlantic markets, are based on sales from April 1, 1994, to March 31.
In Hampton Roads, third-ranked Super Fresh, a subsidiary of A&P, jumped 1.2 percentage points with its new Farmer Jack in Virginia Beach.
The Great Atlantic & Pacific Tea Co. of Montvale, N.J., is looking for sites for more Farmer Jacks. But so far, no plans have been announced.
``Expansion plans at the tea company do not move rapidly,'' said Jeffrey W. Metzger, Food World's publisher. ``Now that Harris Teeter, Hannaford and Winn-Dixie are in the hunt, they've driven the cost of real estate up. A&P will not slug it out.''
In the Richmond area, Farm Fresh's declines in sales and market share - almost two percentage points - are slightly deceptive, Food World said. The 1994 figures were artificially inflated by the chain's purchase of nine Safeway Inc. stores.
Also, Farm Fresh closed two of those stores last year, leaving it with 14 The Grocery Stores and a Rack & Sack discount store in Richmond. With its competitors falling back, regional leader Ukrop's Super Markets Inc. posted a surprising gain of almost 4 percentage points. The family-owned chain of 23 stores opened just one store but had large growth in same-store sales, Food World said.
Over the next two years the rankings could look a lot different. Several chains plan to open several stores in the Hampton Roads and Richmond markets. Matthews, N.C.-based Harris Teeter plans to open stores in Chesapeake, Virginia Beach and Newport News, while Scarborough, Maine-based Hannaford Bros. Co. will open several supermarkets in both markets.
Newcomers may include nontraditional supermarket chains.
Kmart is looking to debut several of its SuperKmarts, a discount-grocery combination, in Hampton Roads. Wal-Mart, meantime, plans to convert four of its Richmond stores into a similar format.
The influx of supermarket chains could be good news for consumers, but tough on stores.
``I think the market is already saturated,'' said Farm Fresh's Julian. ``Harris Teeter, Hannaford, SuperKmart, Wal-Mart superstores . . . I'm waiting for Kramer Tires to start selling groceries.'' ILLUSTRATION: Graphic
STAFF
SUPERMARKET LEADERS IN HAMPTON ROADS
SOURCE: Food World, June 1995
[For complete graphic, please see microfilm]
by CNB