Giant fish, flowers going self-serve

No. 1 grocery chain in region to reduce full-service departments at 62 stores

March 23, 2007|By Meredith Cohn | Meredith Cohn,Sun reporter

The fresh trout, $6.99 a pound, lay glistening on ice in a case at the Reisterstown Road Giant Food in Owings Mills earlier this week. There also was tilapia and cod and shrimp nestled in the frosty chips.

But during the next few months, the familiar case of seafood dinner choices at this store and more than 50 Giant outlets in the region will be removed.

In their place will be refrigerators and freezers filled with pre-packaged fish as the grocery chain moves to a self-service system in a little over a quarter of its 190 stores in the region.

The Baltimore area's largest grocery chain also will turn floral departments at 62 stores into self-service, noting slower sales in these stores.

Giant, which has lost market share in recent years, is not alone in its move to more self-service. Other chains are facing similar cost pressures in the increasingly crowded and competitive grocery industry, according to analysts.

And as consumer habits have changed with more people heading to stores later in the evenings, grocery consultants said some shoppers are more receptive to such setups.

But the news has left some workers, and Giant customers, a little disappointed.

And some consultants said the moves could hurt Giant since many competing stores offer full-service seafood and floral departments.

"Sometimes I want help," said shopper Evelyn Blake, as she looked over the day's fresh-fish offerings earlier this week in Owings Mills. "Sometimes I want to see fish on ice and pick the piece and have it wrapped. When it's packaged in a case, I don't know how long it's been sitting there."

Barry Scher, a Giant spokesman, said that the changes began last month and will continue for several more.

He emphasized that the fish still would be delivered almost daily to the stores where the seafood counters are being eliminated. Seafood will be wrapped in the meat department and put out in cases. Help will be available from that department, where some of the seafood workers will be allowed to relocate under the union contract.

"The product will be just as fresh," Scher said.

He added that no workers would be laid off as changes are made in stores in Maryland, Virginia, Delaware and Washington. The union that represents all Giant workers estimates that between seafood and floral departments, an estimated 170 employees will be moved to another department or another store, possibly farther from home. Some will be given part-time work, the union said.

Giant has no plans to make changes in other stores, Scher said. And other service departments - such as the bakeries and delis where stronger demand and sales remain - will not be affected.

"Many other [chains] have moved to the self-service approach," Scher said. "It's something happening in the competitive world."

Grocers began adding service workers in the 1980s, but since then many have cut back because of costs and changing demands from shoppers, according to Bob Goldin, executive vice president of Technomics Inc., a Chicago food-market research company.

Most supermarkets still typically offer some service in seafood, floral, meat, deli and bakery departments. But some stores provide limited hours or have reduced workers to save money.

However, Goldin said as traditional groceries seek ways to compete with behemoth discounters such as Wal-Mart and others, some chains are adding people and offerings to differentiate themselves.

For example, a spokesman for Safeway, a chief competitor of Giant with 179 stores in the region, said the chain has adopted that philosophy and plans to add workers to its seafood, floral, deli and bakery departments.

"It's going both ways," Goldin said. "Giant has typically been a little more focused along the lines of service versus strictly price, so it's an interesting move. ... It may backfire with customers."

The grocery chain has struggled recently with sagging sales due to pressure from the low-price stores and also from high-end markets such as Wegmans Gourmet Foods Inc. and Whole Foods Markets Inc. Giant said earlier this month it would close five of its oldest stores.

Giant's Dutch parent, Royal Ahold NV, is struggling to regain its footing after being rocked by an accounting scandal more than three years ago at its U.S. Foodservice wholesale unit in Columbia. Ahold has moved recently to reinvigorate its U.S. supermarkets by adding what it calls more convenience and an "everyday low price" strategy.

A spokesman for the Arlington, Va.-based Food Marketing Institute, an association representing food retailers and wholesalers, agreed that there is no clear trend on service. The number of stores with deli and bakery service, for example, has gone up from 1995 to 2005. So has the number of stores with a butcher in the meat department.

At the same time, surveys by the group show that 70 percent of meat is sold on a self-service basis. And more seafood is sold the same way: 88 percent in 2004 up from 75 percent in 2002.

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