Stores Magazine - December 2007 - (Page 27)

PRECIOS SIEMPRE BAJOS 7.7 annually between 1994 and 2004, more than 2.5 times that of the overall U.S. population, according to Hispanic Intelligence – is growing, too. Hispanic consumers also shop more frequently and spend more on groceries than the average U.S. resident, according to the Food Marketing Institute’s El Mercado: U.S. Hispanic Grocery Shopper Trends. Still, mainstream grocery retailers have largely ignored Hispanic consumers, forcing them to Americanize their tastes Whatever Wal-Mart is doing in the Dallas-Fort Worth market, it has been successful in winning over Hispanic residents, becoming their No. 1 grocery destination for the first time. In the DFW Latino Trendline survey conducted by Dallas research firm Rincon & Associates, Hispanic shoppers rated Wal-Mart as their favorite store; it ranked ninth as recently as 2001. Fiesta and Carnival were favored by new immigrants, while U.S.-born Hispanics much preferred Wal-Mart, said Edward T. Rincon, president of Rincon & Associates and an adjunct professor of Southern Methodist University’s Cox School of Business. What’s working for Wal-Mart in Dallas? The same as elsewhere – pricing strategy. “Native-born Latinos are more price-conscious: They’re willing to trade off some of the cultural dimensions of their shopping traditions in favor of good pricing,” Rincon says. In implementing its “store of the community” strategy, Wal-Mart’s U.S. division has worked closely with Wal-Mart de Mexico to provide a merchandise mix that offers products familiar to the “significant MexicanAmerican population” in this country. The company also touts the fact that it is the nation’s largest private employer of Hispanics (154,000). or retreat to neighborhood bodegas and mercados. One notable exception has been the H. E. Butt Grocery Co., which has ingratiated itself with a large swath of consumers by stocking produce and cuts of meat familiar from “home.” H.E.B., as the chain now refers to itself, has grown into a $13 billion retailer and still makes its own tortillas for sale in stores. Ten years ago, H.E.B. expanded across the border with a store in Monterrey, Mexico; it now has 25 stores in five Mexican states. Texas is a big state and, at 7.8 million, has the nation’s second-largest Hispanic population. Yet even with more than 300 stores, H.E.B. does not go unchallenged. Fiesta and Carnival are indigenous Hispanic chains with loyal followings. Fiesta has expanded into central and north Texas from its Houston base; Carnival is growing in its home territory of Dallas-Fort Worth. Carnival was launched by Minyard several years ago as the family-owned company tried to stay competitive by transforming some older locations into stores catering to Hispanic shoppers. Now owned by a private-equity company, Carnival is opening new stores amid talk that the company’s Minyard groWWW.STORES.ORG ceries and Sack ’n Save limited assortment markets face possible extinction. Though Carnival, Fiesta and H.E.B. are all represented in the Dallas-Fort Worth area, the No. 1 grocery seller among Hispanics in that market is Wal-Mart [see above]. It operates 110 supercenters, Neighborhood Markets and Sam’s Clubs in the area and captures roughly one of every three dollars Hispanics spend on groceries, according to Marketscope, published by ACNielsen’s Trade Dimensions. South Florida-Cuban connection The south Florida-Cuban connection is important to Sedano’s, which, with 30 stores and annual sales of $500 milSTORES / DECEMBER 2007 27 http://WWW.STORES.ORG

Table of Contents Feed for the Digital Edition of Stores Magazine - December 2007

STORES - December 2007 Contents Executive Editor's Page President's Page Holiday Shopping Extravagance What Shoppers Think 10 Things You May Have Missed Numbers Worth Counting Full Price/Markdown Retail People Niche Marketing Eight Predictions for 2008 Concept2Watch Merchandising Strategy Sourcing E-Commerce Supply Chain Warehouse Management Software Contactless Payments Marketing Marketing Online Loeb Retail Letter ARTS Update Point of View NRF News Retail Industry Calendar Last Laugh

Stores Magazine - December 2007

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