Wal-Mart brings more food into its discount stores; Florida test of frozen items just the beginning - Wal-Mart Stores Inc. allows Loggins Meat Co. to sell food on premises

Discount Store News, Sept 16, 1996 by Pete Hisey

BRANDON, FLA. -- Wal-Mart, like most discounters, is experimenting with ways of bringing more fresh and frozen food into its traditional department stores, and a cluster of stores near Tampa has been serving as a laboratory of sorts for those strategies.

The Brandon location, a newer, larger store, now sports: a leased produce stand in its parking lot; a window freezer stocked with frozen seafood, steaks, chicken and pork at the front of the store; a new Good Humor single-serve freezer at checkout; and roadblock selections of snacks and chips in the power aisle at the front of the store.

Other stores nationwide have experimented with expanded food offerings: Some small HomeTown USA stores stock fresh meat and produce; a store in New Jersey is endcapping bread products at checkout, including Thomas English Muffins, Lerner's Bagels and Wonder Bread; stores in Hispanic markets stock tortillas; and most stores now stock fresh dairy, breakfast meat and citrus juices near checkout.

But the Brandon store hints at things to come. The 4-ft., two-door window freezer stocks 13 skus of frozen, single-portion entrees, including New York strip steaks, Sante Fe chicken, stuffed flounder, peel-and-eat shrimp, stuffed pork loin, salmon steaks and teriyaki chicken and steak. The poly-bagged packages, ranging from 2 lbs. to 4 lbs. in weight, cost between $14.48 for chicken breasts to $18.96 for strip steaks.

The program, from Loggins Meat Co. of Tyler, Texas, is still in an experimental stage, but could be rolled out nationally this fall, a Loggins spokesman said. Stores will run the program only on a periodic basis, with promotions planned every five weeks or so.

That's because regular Wal-Mart stores have no freezer facilities for backup stock, requiring the vendor to leave a refrigerated truck parked in front of the store for restocking.

Loggins has run similar but more limited barbecue season promotions with season promotions with regional discounters like Caldor, Venture, Pamida, Rose's and others. The main problem in most of these programs, Loggins said, has been the sheer velocity of a promotion. "You only have, at most, 300 sales in two freezers," the spokesman said. "But during a promotion, someone like Caldor can go through a lot more than that in a day." That kind of volume, coupled with lack of storage for backup stock, makes the business "very labor-intensive."

Nevertheless, Wal-Mart and Loggins, under the AmeriPride private label, may turn a strictly local operation (only a handful of western Florida region stores have the program in place) national in the near future.

The program--trucks, freezers, meat, signage and all--would circulate among groups of stores, with each store allowed to promote the program once every five weeks or so.

Loggins is responsible for the entire program, including working with individual managers, restocking and in-store merchandising.

Wal-Mart will promote the offering in circulars, and Loggins will conduct tastings, which also promote stove-top grills from various suppliers, during the week of the promotion. Stores will have another week to sell down any leftovers, and then the truck will move on to the next store on its list.

The logistics problems such as getting trucks and workers to the right stores at the right time and making sure adequate stocks are available have slowed the launch of the program somewhat, but Loggins expects to have most of the logistics in place by October.

To date, the program has been a major success, the Loggins spokesman said, and most Wal-Mart store managers are very open to food strategies.

"With their traffic, all you have to do is put food under shoppers' noses and they buy," he said. Wal-Mart gets a cut of all sales, with little or no investment.

Wal-Mart has tested literally dozens of approaches to food selling, including, of course, its supercenters. In the past year, a Harry's in a Hurry fresh food concept floundered after supplier Harry's Markets decided to focus on its core farmers market concept, while Radio Grill, a 1950s style burger joint is still in test mode in the upper Midwest.

Many of its snack bars have been taken over by McDonalds, and fresh bread strategies, with bagels in the Northeast and tortillas in the West and Southwest, are now universal. The company has also added wholesale-clubsized bags of rice and other staples.