
The big yellow sign at the entrance to the new Valu King grocery store in Johnstown's Westwood Plaza seemed to be an instruction manual on what to expect when shoppers get inside.
"We only offer products that are great deals." "We keep advertising to a minimum." "We encourage you to bring bags. We have bags available for a small fee." Oh, and the store does not take checks.
Everything new takes getting used to, but this low-price, limited-selection experiment by O'Hara grocery chain Giant Eagle hasn't confused shoppers as much as officials feared when they opened their first Valu King in late 2008 outside of Cleveland.
"This is a real departure from what you would get in a traditional retail store," said John Tedesco, senior vice president for Valu King. It took the customers all of about five minutes to figure it out, he said.
The Valu King concept represents Giant Eagle's take on a trend that might be called a semilimited assortment store. That's what label consultant Jim Hertel came up with to describe a format that borrows ideas that have worked for low-price grocers Aldi and Save-A-Lot but adds more space and services without tilting too far into more expensive traditional supermarket practices.
Giant Eagle has been tinkering with the format since opening that first Valu King, followed by a few more in Ohio. This, its fifth store, is the first in Pennsylvania. Another is slated for the Erie market within the next several months.
"It's kind of exploring maybe some white space between a 55,000-square-foot -- or, in Giant Eagle's case, a 75,000-square-foot -- store and the rock bottom prices of a limited assortment store," said Mr. Hertel, senior vice president of consulting firm Willard Bishop, Barrington, Ill.
In the competitive grocery industry, there's no end of efforts to find formats that work. Nontraditional players such as Wal-Mart, Target, Whole Foods Markets, warehouse clubs, dollar stores and limited assortment chains have taken market share from conventional supermarkets.
Giant Eagle has come up with a number of ways to get its wares into different spaces from its GetGo convenience stores to its foodie-oriented Market District locations. Those models are expanding while the company has not opened a lot of its Express stores, a smaller format that's a few steps up from a convenience store.
The Valu King concept is growing in part by taking advantage of locations abandoned by traditional grocers. The Johnstown site had housed a BiLo store, making the conversion costs lower. "The premise is all about low cost of operations," said Mr. Tedesco.
At the 43,000-square-foot, 50-employee store, shoppers find lots of produce but not all the lettuce or mushroom varieties that might be seen in a Giant Eagle. Some lettuce varieties require too much handling by staff, he said, which raises costs.
Bananas run 39 cents a pound. "That's not a sale," he said proudly.
Further along, the bread selection was limited to basic varieties from private label brand Valu Time and from the Schwebel's brand.
Private label goods dominate the store but there are also brand name items, some of which change based on what the company's buyers find. A deal on 14.75-ounce cans of Libby's vegetables, from cream style sweet corn to French style green beans, produced a display stacked several layers high and more than 100 cans wide.
The sign above the stash said the price per can was 57 cents "while supplies last!"
"You can't do all of your shopping here, but this is where you should come first," said Mr. Tedesco.
Unlike some limited assortment competitors, Valu King has butchers grinding ground beef and cutting meats. At a small deli counter, there was a selection of meats and cheeses from names such as Eckrich and Smithfield in addition to Valu Time. Rotisserie chickens cost $4.49.
"We listened to what customers requested," said Mr. Tedesco, explaining why the store offers fresh meats but doesn't have a bakery or a big health and beauty selection.
More things could change before the next store opens. He doesn't know how many stores the format might be able to support or even when one might open closer to the Pittsburgh area. "We're still early on in the development."
Customers at the store last week found things they liked but also had suggestions for improvements. They liked that it was bigger and had more selection than some discount grocers. One shopper praised the meat selection, which had lean cuts available.
"The prices are pretty good," said Westmont resident Joe Torchia, whose cart had a number of items including a rotisserie chicken and a bag of Valu Time tortilla chips. He thought meat prices could have been a bit lower and he'd seen a bag of Hershey's Kisses cheaper that morning at a Rite Aid.
He wasn't confused by the connection to Giant Eagle, which has one of its namesake stores not far away, a place that he described as "rather expensive."
Mr. Torchia may have been most pleased that the Valu King had moved into a neighborhood that needed a grocery. "All in all, I think it's a good thing."
Company managers said they hadn't had too many customers asking about whether they can earn fuelperks! gas discounts. The new format is not a part of Giant Eagle's loyalty card programs.
One of the new store's most popular features wasn't anything fancy. The place was, as Kathy Barczak of Westmont pointed out, neat and clean. Not all the low-price grocery stores that she's been in have met that standard. "Let's hope it stays that way."
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