Kroger

[JDSooners]

Anyone know why a Krogers affiliated store isn't in our market?

[SOONER8693]

Anyone know why a Krogers affiliated store isn't in our market?

I graduated from high school with David Dillon, who was the CEO of Dillons/Krogers. I believe he is retired now. I last save Dave at our 40yr class reunion. At that time he was CEO and living in Cincinnati, hdqrs of Krogers. He has since back back to Hutchinson, I think. His grandfather started the Dillons stores in Sterling, Ks, many years ago. They, Dillons were hdqrd in Hutchinson. They were then bought out by Krogers and much of the operation went to Cinci. Anyway, I asked him at our last class reunion if they would ever be coming into Oklahoma, and, he said at that time just didn't seem to be a good fit for them. Whatever that means. IDK?

[Bowser214]

Growing in Western Oklahoma I remember every Thanksgiving going to visit Grandparents in Hutchison KS and we would stop by Dillions and get a sack of their all purpose flour. It was seasoned and made the best fried chicken!

[chuck5815]

Whether we like it or not, Kroger is decidedly middle-market. It's not trying to be a deep discounter nor is it trying to compete with Whole Foods on wagyu beef, kale chips, and quinoa. The average Kroger reminds me of a slightly upscale Homeland, and we've seen that Homeland has been reeling a bit in OKC. Kroger is also similar to Homeland in that it allows certain stores to age rather disgracefully. Although it seems like that is a choice driven by the level of competition faced in each market.

In any event, It's just tough sledding for any grocer trying to thread the needle between discounting and selling rare granolas. When you add in OKC's commodity risk, it's easy to appreciate the CEO's concerns about fit.

[stile99]

And yet Crest seems to be doing quite well, and Winco, though it may settle down in time, is off the charts. I think the 'risk' in OKC is if you half-ass it like Homeland, so if that's what Kroger would do, then yeah, I can see why they're afraid.

[chuck5815]

And yet Crest seems to be doing quite well, and Winco, though it may settle down in time, is off the charts. I think the 'risk' in OKC is if you half-ass it like Homeland, so if that's what Kroger would do, then yeah, I can see why they're afraid.

Of course, but Crest ("rock bottom prices") and Winco (no bagging, no credit cards, etc.) fall firmly within the discounter classification.

I'm sure Kroger would do fine here, but most of the players recently entering the OKC market have skewed to the high end or to discounting.

[Questor]

Yeah, it's been pointed out many times... in general the only stuff that does well here is deep discount. You have your one Whole Foods in the most expensive metro zip code and so on, but in general this does ring true. If you think about the organic options we have even those are sort of at the discount end of the spectrum and their company mottos pretty much confirm this.

[stile99]

If you categorize Crest and Winco with Aldi, then you are most surely free to your opinion, but you're woefully incorrect. If you're going by corporate slogans, Walmart ("beware of falling prices", "everyday low prices", "save money, live better") is also in the same category, as is Target ("get more, pay less"). Isn't the motto of EVERY store (with the exception of Whole Foods, who wears their "Whole Paycheck" label proudly) some variation of "shop here and save"? Including the much-worshipped Trader Joe's, who in a recent radio spot said "Instead of wondering how to make shirt racks fit in the grocery aisle, we’re providing our customers incredible values on interesting products, every day."

https://www.traderjoes.com/digin/post/food-beverages

If you look at the "our story" section of the website, they talk about value and everyday low prices and keeping costs low and saving money. No, I'm sorry, but if we go by corporate buzzwords, everything is a "discounter". My point stands, Kroger would do very well here if they put in some effort, as others have shown. If they half-assed it, they would share Homeland's fate.

[Questor]

If you categorize Crest and Winco with Aldi, then you are most surely free to your opinion, but you're woefully incorrect. If you're going by corporate slogans, Walmart ("beware of falling prices", "everyday low prices", "save money, live better") is also in the same category, as is Target ("get more, pay less"). Isn't the motto of EVERY store (with the exception of Whole Foods, who wears their "Whole Paycheck" label proudly) some variation of "shop here and save"? Including the much-worshipped Trader Joe's, who in a recent radio spot said "Instead of wondering how to make shirt racks fit in the grocery aisle, we’re providing our customers incredible values on interesting products, every day."

https://www.traderjoes.com/digin/post/food-beverages

If you look at the "our story" section of the website, they talk about value and everyday low prices and keeping costs low and saving money. No, I'm sorry, but if we go by corporate buzzwords, everything is a "discounter". My point stands, Kroger would do very well here if they put in some effort, as others have shown. If they half-assed it, they would share Homeland's fate.

I don't know man, I travel a lot and what I see out there in the big wide world is nothing like what you are talking about here. There are tons of chains that focus on, and have buzz words, swirling around quality. You'll never convince me that we're a Denver or a Los Angeles or a take your pick. Considering of every chain I can think of that are the ones that focus on quality over cost, and we have exactly one maybe two of them here and they are both the smallest footprint stores they have in the costliest zip code we have, with exactly one store, I don't see how I'm not right if you take an honest look at the market.

[bchris02]

Considering of every chain I can think of that are the ones that focus on quality over cost, and we have exactly one maybe two of them here and they are both the smallest footprint stores they have in the costliest zip code we have, with exactly one store, I don't see how I'm not right if you take an honest look at the market.

Yet better retailers who do take a chance on OKC almost always far outperform expectations.

The OKC market in terms of retail is plagued by two big problems; sprawl and perception.

[SoonerDave]

Yet better retailers who do take a chance on OKC almost always far outperform expectations.

The OKC market in terms of retail is plagued by two big problems; sprawl and perception.

Agree that merchants always seem to underestimate the OKC market; disagree that sprawl is a problem. It's an *asset*, and it's part of why we're chronically underestimated. We have tremendous population and cost demographics around the west, southwest and south parts of OKC that are seemingly *perpetually* undervalued/underestimated, whether its for retail sales, restaurants, what-have-you. I think that misperception extends all the way down to the Norman area - there's a new LaMadeleine's going in that I think is too small and will *easily* outperform expectations when it opens - but it's taken that chain *years* to get into the central OK market for almost certainly those very same reasons.

Sprawl is something WalMart has recognized as an OKC asset and one they also recognize other retailers have overlooked and miscalculated, hence their decision to plop down grocery stores seemingly every 2,500 feet (sarcasm intended). They get it. They see all that money just waiting to be spent, and they're glad to take it where other retailers don't believe it exists. WalMart is laughing all the way to the bank.

People in the OKC area will pay for quality - to a point - and I think Crest is a model for precisely the kind of balance between low-end, no-name places like Aldi's and higher-margin places like Whole Foods. Crest has, *generally*, very good prices, but they're not some cheapskate operation; they have a meat counter, deli, sushi station, cheese market, and bakery. Homeland tried variations on that for *years* with their model and couldn't make it work without the worst prices in town, and guess what - they're all but dead here. Crest has figured out something that other retailers would be smart to emulate.

[bchris02]

Agree that merchants always seem to underestimate the OKC market; disagree that sprawl is a problem. It's an *asset*, and it's part of why we're chronically underestimated. We have tremendous population and cost demographics around the west, southwest and south parts of OKC that are seemingly *perpetually* undervalued/underestimated, whether its for retail sales, restaurants, what-have-you. I think that misperception extends all the way down to the Norman area - there's a new LaMadeleine's going in that I think is too small and will *easily* outperform expectations when it opens - but it's taken that chain *years* to get into the central OK market for almost certainly those very same reasons.

I think where sprawl becomes an issue is because, as has been discussed on this board before, most retailers when deciding a location will figure up how much money is concentrated within a 1, 5, and 15 mile radius of a specific location. OKC's sprawl results in these numbers coming in much lower than most comparable markets. As a result, retailers tend to pass over OKC while entering similar sized and even smaller markets. What retailers don't figure in is that people in OKC will typically drive farther to a destination than in most comparable markets.

[chuck5815]

If you categorize Crest and Winco with Aldi, then you are most surely free to your opinion, but you're woefully incorrect. If you're going by corporate slogans, Walmart ("beware of falling prices", "everyday low prices", "save money, live better") is also in the same category, as is Target ("get more, pay less"). Isn't the motto of EVERY store (with the exception of Whole Foods, who wears their "Whole Paycheck" label proudly) some variation of "shop here and save"? Including the much-worshipped Trader Joe's, who in a recent radio spot said "Instead of wondering how to make shirt racks fit in the grocery aisle, we’re providing our customers incredible values on interesting products, every day."

https://www.traderjoes.com/digin/post/food-beverages

If you look at the "our story" section of the website, they talk about value and everyday low prices and keeping costs low and saving money. No, I'm sorry, but if we go by corporate buzzwords, everything is a "discounter". My point stands, Kroger would do very well here if they put in some effort, as others have shown. If they half-assed it, they would share Homeland's fate.

It's certainly not wrong to say that Winco and Crest are closer to Aldi than they are to Kroger.

From Winco's website:

• Bulk Bins – less packaging, big savings, more than 800 items by the pound…need we say more?
• No gimmicks – prices are low and you don’t have to jump through hoops to get them. But if you’re looking for even more savings, you find printable coupons here.
• We’re Open for 24 hour Savings, 7 days a week – except certain holidays.
• You bag your own groceries – this means you can arrange them how you like (find tips here), and know you’re helping keep prices low.
• We accept debit cards but do not take credit cards – another way we keep prices so low.

From Crest's website:

• We buy direct from 150 manufacturers and the largest supplier in the state.
• We do not spend large sums of money on advertising.
• Low overhead. Pay no rent. Own our own facilities.
• No games, no gimmicks or expensive frills.

[SoonerDave]

It's certainly not wrong to say that Winco and Crest are closer to Aldi than they are to Kroger.

So? No offense, but drawing a comparison and a subsequent conclusion in that manner is like saying the Earth is closer to the sun than Neptune, therefore the Earth is more like the sun.

To put Crest and Aldi's in even remotely the same basket is absurd on its face - Aldi's retail model is *entirely* different, with the no-name knockoffs being their raison d'etre for existing and offering the lower prices, on top of their barely-more-than-shelves-and-walls stores. Their interior feel is more like a bad 7-11 than a grocery store, to say nothing of the absence of such things like bakeries and meat counters. Not even an apples-to-oranges comparison; more like an apples to pancakes comparison. Yup, they're both grocery stores, but beyond that...

[chuck5815]

So? No offense, but drawing a comparison and a subsequent conclusion in that manner is like saying the Earth is closer to the sun than Neptune, therefore the Earth is more like the sun.

To put Crest and Aldi's in even remotely the same basket is absurd on its face - Aldi's retail model is *entirely* different, with the no-name knockoffs being their raison d'etre for existing and offering the lower prices, on top of their barely-more-than-shelves-and-walls stores. Their interior feel is more like a bad 7-11 than a grocery store, to say nothing of the absence of such things like bakeries and meat counters. Not even an apples-to-oranges comparison; more like an apples to pancakes comparison. Yup, they're both grocery stores, but beyond that...

Perhaps you are right insofar as store experience is concerned. However, I just don't consider Crest to be middle market. It's prices for most items are similar to or even better than Walmart, and it's fair to think of Walmart as a discounter.

http://www.huffingtonpost.com/max-le...b_5039301.html

[bchris02]

Perhaps you are right insofar as store experience is concerned. However, I just don't consider Crest to be middle market. It's prices for most items are similar to or even better than Walmart, and it's fair to think of Walmart as a discounter.

http://www.huffingtonpost.com/max-le...b_5039301.html

Crest's locations in SW OKC and in Norman both present themselves as solid, middle-tier grocery stores. Those stores remind me very much of a Kroger or Harris Teeter. Their older stores are a notch below that but I would still consider them to be above an Aldi.

[SoonerDave]

Perhaps you are right insofar as store experience is concerned. However, I just don't consider Crest to be middle market. It's prices for most items are similar to or even better than Walmart, and it's fair to think of Walmart as a discounter.

http://www.huffingtonpost.com/max-le...b_5039301.html

Once again, no offense, but we have the fatal logical fallacy in the argument - Crest is cheaper than WalMart, WalMart is a discounter, therefore Crest is a discounter. The argument is just fundamentally flawed. That's like saying my kid is using a crayon, some crayons are red, therefore my kid is using a red crayon. It's as flawed as the previous argument.

How are Crest and WalMart different? Entirely different marketing strategies and business models; Crest doesn't advertise at all. WalMart essentially never owns its own buildings; they develop, rent, then abandon-in-place; Crest owns everything. Yet Crest's in-store experience is miles ahead of WalMart; Crest actively keeps their stores neat and clean, reserves restocking to late hours. Where are they similar? They both leverage bulk purchases, which is obviously an area where WM will always have an advantage.

Crest has undoubtedly stepped up their own store experience with their Norman and SW OKC stores as examples; their older Moore store, converted from a Homeland, is indicative of this. Aldi's hasn't changed theirs arguably since their inception; unbox it and shelve it has been their modus operandi essentially from day one. Crest is miles beyond that model.

[bchris02]

There are two big problems with the grocery market in OKC. One is how deeply entrenched Wal-Mart is. While Wal-Mart is stiff competition with mid-tier grocers everywhere, nowhere do they have the kind of market dominance that they do in OKC. The second is the alcohol laws here. Mid-tier grocers are being squeezed from the high end and the low end across the country. Many of them have focused on providing an extensive selection of beer and wine, wine tastings, etc in order to increase their profit because that's a very profitable market. The downtown Harris Teeter in Charlotte, during its early days, focused heavily on its beer/wine section. Problem is in Oklahoma they can't sell wine and they are stuck with 3.2 beer.

I am hoping that within a few years after the new liquor laws go into effect that the grocery market here corrects itself.

[Questor]

There are two big problems with the grocery market in OKC. One is how deeply entrenched Wal-Mart is. While Wal-Mart is stiff competition with mid-tier grocers everywhere, nowhere do they have the kind of market dominance that they do in OKC. The second is the alcohol laws here. Mid-tier grocers are being squeezed from the high end and the low end across the country. Many of them have focused on providing an extensive selection of beer and wine, wine tastings, etc in order to increase their profit because that's a very profitable market. The downtown Harris Teeter in Charlotte, during its early days, focused heavily on its beer/wine section. Problem is in Oklahoma they can't sell wine and they are stuck with 3.2 beer.

I am hoping that within a few years after the new liquor laws go into effect that the grocery market here corrects itself.

The overriding mindset here is it has to be cheap; I think that hurts the grocery market more than the liquor sales issue. You can see it in the shopping options whether we are talking food or cars or clothing, or if we're talking about our governmental services, or even if we are talking about our historic structures and museums (e.g. the discussion always gets into money... there is never a "for the sake of art/beauty" argument). It's at the same time both this state's strongest point as well as its weakest.

We have a lot of poor people, and so of course value-focused chains are going to be more successful here than in the statistically average city. I think we need to be realistic and come to terms with certain realities here. That does not mean that we cannot have nice things. But I think it does mean we are not going to see a wave of Quality Company X populating every street corner for a long, long time if ever.

[JDSooners]

When I see Krogers, King Shoopers, Frys, Dillion's, in a lot of the markets I been to, I really think they could invade the okc market with success.

We've been lulled to sleep with Wal mart pricing, sure it may always stay good in some areas but I think you can drive the price of milk, fruits and vegetables and meat down with more competition.

[kukblue1]

I lived 2 minutes from a Kroger for several years and all grocery stores to me all the same. Some things are going to be cheaper, some things are going to be more expensive, some things price the same. I think Crest has really good prices but I wish they did an ad. I know it saves them money but even online ad would be great. I think Wal-mart grocery are higher price and I never shop there. Braum's produce is better and cheaper than walmart. What I wish we really had was a Meijer. I'm afraid we are too far south for that though.

[foodiefan]

not to dereail, but the "new" Reasor's in Brookside (41st and Peoria) is unbelievable!! A "mini-Wegman's". Sure wish there was something equivalent in OKC. . . .

[rlewis]

Kroger long ago stopped trying to start from scratch in new markets. The M.O. has been to buy up regional chains and leave them with their original nameplates. With Walmart having grocery stores in pretty much every market, this is actually a smart business move on Kroger's part. They don't drain their financial resources trying to get established in a new market in a business that has razor thin profits. I really think the only way they get involved in this market is if they can get a good deal on one of the higher quality local chains.

[riflesforwatie]

I have to be honest, I don't get the hubbub over Kroger. I've only been in a couple of them, I guess, but they just seem like regular grocery stores to me.

[zefferoni]

I have to be honest, I don't get the hubbub over Kroger. I've only been in a couple of them, I guess, but they just seem like regular grocery stores to me.

The one I used to frequent in Conway AR was like a slightly larger version of the 18th and Classen Homeland, so I'm as baffled as you are.