Bill's tests store-within-a grocery store - Bill's Dollar Stores Inc., Sack and Save supermarkets

Discount Store News, March 12, 1990 by Mary Ellen Kelly

Bill's Tests Store-Within-a Grocery Store

JACKSON, Miss. -- Bill's Dollar Stores has put its money where the customer's mouth is. The 550-unit dollar store chain now operates one store within a Sack and Save grocery store, and other units are expected to follow.

Bill's expects the new location in Meridian, Miss., to deliver sales volume three to four times greater than a typical Bill's store. If the new Bill's store hits this target, Fulton Stokes, Bill's president, said he will aggressively pursue similar opportunities both in cooperation with Sack and Save as well as other regional grocery chains in Bill's central U.S. trading area.

Bill's had been looking for a grocery chain that would be willing to explore the potential of housing a Bill's store. The rapport between Bill's Charles Ackland, executive vice president, and Roger Friou, executive vp with Jackson-based McCarty Holden, parent of discount-oriented Sack and Save and moderately priced Jitney Jungle food stores, made the proposed marriage of the two retail concepts a reality.

"Sack and Save needs the perimeter of the store for refrigeration equipment so they put us right in the center of the store!" Ackland said, "This is very clearly a win-win situation for both companies."

The give and take agreement resulted in changes for both retailers. Sack and Save agreed to alter its front-end software to make scanning of both Bill's general merchandise and the grocery store's food items possible through a single register.

Bill's is paying about three times the lease cost at Sack and Save that it would at a typical store. Bill's also pays Sack and Save a set percentage of Bill's sales, but is exposed to store traffic averaging more than 21,000 customers per week. Most Bill's stores attract between 1,000 and 2,000 customers weekly.

Advantages for Sack and Save include easy entry into the combination store business and selecting what merchandise categories the food store operator would rather not handle, according to James Lander, senior vp, administration at Bill's.

"The trend is toward superstores. Bill's gives Sack and Save the opportunity to be in that business," Lander said. "We had to sit down with them and ask, `What are you going to carry and what are we going to carry,' until we were both satisfied."

The upshot of these talks were fewer merchandise categories for Bill's than would be carried in a typical store. Examples include pegged toys, stationery, automotives, health and beauty aids and household chemicals, all of which are now handled by the Sack and Save portion of the store. Bill's filled in the void with high margin merchandise, especially apparel and domestics. While a typical Bill's is 50 percent soft lines, the Sack and Save location is 65 percent soft lines. Total sku's were lowered to 3,000 sku's instead of an average of 6,500 sku's per store.

This newest Bill's store is also the first to incorporate a number of new fixtures, decor and signage enhancements. The color scheme is now bright blue, white and orange. The white in the trio of colors had been beige. The switch to white has brought a very clean look to the store; gondolas are now white. Speed tables are predominantly white with two bold blue and orange horizontal stripes.

The Meridian Sack and Save store also differs from most Bill's in the number of times merchandise will need to be delivered from the 300,000-square-foot distribution center. A typical Bill's receives goods once per week; the Meridian store is expected to require deliveries three to four times per week.

The new store presents a situation Bill's has not previously addressed--24 hour operation. Sack and Save stores are open around-the-clock; Bill's immediate plans are to staff its portion of the store as it would at other locations, from 9 a.m. until 9 p.m.

While higher shrink levels could result, Paul Barrett, senior vice president, finance, calculated that even if shrink levels were far above the chain's 1.2 percent average, as long as sales projections were on target, the Sack and Save location would still be a highly profitable venture.

PHOTO : At Bill's new unit located in a Sack and Save grocery store, Meridian, Miss.: Paul Long,

PHOTO : vp, real estate, Bill's; Ronnie Starns, regional manager, Sack and Save; James Lander, sr

PHOTO : vp, administration, Bill's; Paul Barrett, sr vp, finance.

PHOTO : The first Bill's store in a grocery was met with shoppers anxious for pre-opening barriers

PHOTO : to be taken down.