Terry S. Brown offers his perspective on the transformation of supermarkets as an executive at one of the nation's largest developers and owners of grocery-anchored shopping centers.
Retail Traffic: What's responsible for the surge in renovations of grocery stores?
Brown: Consumers are driving the changes — what they want and when they want it. The focus is on merchandise, quality and convenience. So you'll see a continual evolution of grocery stores. And the pace of change is accelerating because there are more consumer choices.
RT: What has changed most about the business?
Brown: I think the grocery business is more customer focused. Customer service, employee training and loyalty programs are key indicators. For today's busy shopper, who visits the grocery store 2.7 times per week, being able to choose from a selection of fresh items, organic and specialty products as well as prepared foods is imperative. To remain competitive you must offer choice and convenience.
RT: Are choice and convenience addressed by adding more products and services resulting in stores with bigger footprints?
Brown: The focus on convenience is more than just the size of the store. In fact, the average store size, between 45,000 square feet and 75,000 square feet, has not changed over the past several years. Whole Foods Market, Fresh Market and Trader Joe's are examples of grocery stores operating smaller prototypes. Plum Market is a new entry into the organic/specialty grocer category. It has three stores opening around Detroit by the end of next year ranging between 20,000 and 35,000 square feet.
RT: How often does a store need to be made over to keep its competitive edge?
Brown: The building really does not become obsolete. The dynamics inside the store are more relevant to the consumer. The interior shelving, fixtures and signage may need updating every seven years. In markets where the grocer has market share, grocers do not like to shut down a store and wait nine to twelve months for you to build a new one.
RT: What is the biggest shopper convenience Edens & Avant can facilitate?
Brown: Parking. It is a big issue that revolves around convenience. The desired number of spaces per 1,000 square feet is five for suburban locations. In urban areas it is less than that.
RT: Was the reason Edens & Avant opened an office in South Florida last year because the market is underdeveloped?
Brown: No. It was related to our overall strategy. We were already in the major markets along the East Coast from Atlanta to Boston. Miami, as a gateway city, was clearly the next logical market. It was the last of the markets on the East Coast that we weren't already in.
RT: In Charlotte, N.C., and Washington, D.C., the company is developing mixed-use projects. What are the challenges of incorporating grocery stores into such projects?
Brown: There are a lot of issues. Loading, stocking and parking are among them. In the case of parking, it's whether it is in front of, behind, above or below the store. There is also the configuration and allocation of space for the heating, ventilation and air conditioning. There are a lot of factors that can complicate those developments.