Food Lion a Bloom

The chain has turned a Scaggsville supermarket into a high-end store

August 20, 2006|BY A SUN REPORTER

It always seemed incongruous: Virtually in eyesight of Maple Lawn, Maryland, where homes go for high six figures and escalate quickly, stood a Food Lion, known mainly for limited selections and low costs.

No more.

The supermarket in Scaggsville is now a Bloom.

The store represents far more than a change in name. To be sure, Bloom symbolizes a corporate transformation for Food Lion LLC driven by increased and relentless competition.

"We did two years of market research ... looking for consumer input into what they wanted in a grocery store," said Karen Peterson, communications manager of Bloom.

What the company found, among other things, was that consumers are not homogeneous, and one store does not fit all.

As a result, the company is being carved into three divisions: Bloom, its new high-end unit; the traditional Food Lion stores; and Bottom Dollar Food stores, a new, lower-end operation.

About 40 Food Lions will be converted to Blooms this year, the company says. They are unlike anything it has offered before.

For starters, Bloom does not have customers, but "guests." The stores are designed to provide a "distinctly convenient and novel shopping experience," said Robin Johnson, director of Bloom's marketing and brand development.

Perishables are in one section of the store and nonperishables in another. Featured are wider aisles, lower shelves and kiosks to help customers find products, check prices and print out recipes. Children can play games at the kiosks.

Customers won't find the traditional aisle arrangements. Instead, Peterson said, food products are grouped by "family." Breakfast items, for instance, are together, meaning shoppers will find such products as cereals, batter mixes, bagels, milk and bacon in the same aisle at most Bloom stores. In some stores that were converted, including the one in Scaggsville, that approach is only partially implemented because of the existing refrigeration systems.

Some stores will include hand-held scanners to allow customers to scan and bag their groceries as they shop.

The selection has been upgraded, and Bloom offers far more specialty products than the traditional Food Lion stores. Near the front of each store is a section offering quick, homemade meals. The stores also offer pizzas, sandwiches, salads, sushi, fresh pasta - imported from Italy - refrigerated entrees and a variety of desserts, all made in-house.

The Scaggsville store, which is open 24 hours, has a pharmacy, and in a few weeks, it will be expanded to include a drive-through service. From one counter, customers can fax documents, ship packages, rent videos, purchase mail orders, withdraw money from an automated teller machine and purchase a fishing license.

"We're trying to serve customers better," said Terry Walton, customer service manager. "It's been designed to be very convenient and to offer something for everyone."

Jeffrey W. Metzger, publisher of Food World, said Food Lion had to make a bold move or risk becoming little more than an afterthought, especially in more affluent areas such as Howard County.

"It had an image problem - a perception that was somewhat in the middle," he said.

Being in the middle, or "gray area," as Metzger put it, is fraught with danger as the supermarket landscape shifts significantly.

Food Lion is not the only company seeking equilibrium in the face of unprecedented competition. Giant Food, the dominant supermarket in the region, is expected to announce this fall a price-reduction strategy in hopes of retaining customers and winning back those who fled to competitors.

That competition ranges from stores that rely on low prices, such as Shoppers Food & Pharmacy, to large-volume membership operations, including BJ's Warehouse Club, to huge retailers, such as Wal-Mart Stores Inc., to high-end operations such as Wegmans Food Markets.

In the face of such competition, a change in strategy was necessary for Food Lion, a unit of Belgium-based Delhaize Group, Metzger said.

For almost a half-century, Food Lion succeeded, for much of that time by building smaller-than-usual markets and providing low prices. But that single-minded approach will not work today in all markets, Metzger said.

"They were regarded as the low-price leader," he said. "But they lost that to some degree. They certainly have a declining identity price-wise."

The Bloom division is perhaps the most significant departure for the company.

The company opened five stores in North Carolina in 2004 to test the concept. And last month, it converted its Food Lion in Scaggsville to a Bloom and opened two in the Gaithersburg area and one in Frederick.

Metzger said the Bloom concept is sound. "They have basically changed pretty radically," he said. "The strategy is good."

Food Lion, Metzger said, had to differentiate itself from its competitors. "There are absolutely too many supermarkets - too many other types of retailers who want to expand their offerings in food."

He said there will be an industry "shaking out" in the next couple of years, and "the guys in gray areas will be vulnerable."

The ultimate test for Bloom, he said, "is not just in the format, but in the execution."

Thus far, Metzger said, "the early results have been pretty good."

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