DooDiligence Posted April 26, 2020 Share Posted April 26, 2020 Ive interestingly observed that Shop Rite brand products, particularly Bowl & Basket are making massive gains in terms of shelf space. This is not just one store, its across the board including a couple Village locations. Obviously demand is there, but also interesting is that they are keeping up with that demand, whereas most other brands go through long stretches of depletion. For instance, the potato chips and pretzels, back in February had about the same representation as Herrs. Now only Frito Lay has more space. But Frito Lay asp is about $3.99, Bowl & Basket, $1.29. Soup, Campell's is $1.89, SR is $0.88. Bread, Freihofer is $3.49, Pepperidge Farm $3.99, Bowl & Basket $0.99-$1.39, English Muffins, Thomas's $4.49, SR 2/$3. It's really quite remarkable and there is not much quality drop off. Thanks for the input. I've been buying WalMart's Great Value chips, peanut butter, canned goods, soft drinks, pizza's, frozen veggies, etc., for quite a while now & they are, for the most part, as good as popular name brands. Notable exceptions are Frito's (IMO definitely better than the store brand), Bon Mamaan' blueberry preserves (there are no substitutes), Community Dark Roast coffee beans (ditto, no substitutes) but TBF my preference here is probably because I spent so long drinking it at work. Store brand packaging has improved a lot since the plain white boxes & cans WalMart started with. Recently tried Winn Dixie's Southeastern Grocers brand pop-tarts & their chocolate covered graham cracker cookies. IMO these 2 brands were way better than the original Kellogg Pop Tarts & Keebler cookies. I was really surprised at how good these 2 items were. We're seeing a lot of gaps in shelf space resulting from tight inventories ATM. I remember starting to notice the plain white boxes & cans showing up post 2008. I don't believe that revamped packaging or enhanced marketing will help the old guard going into another economic downturn. Price will be the differentiator. I wouldn't be surprised to see store brands encroaching further into dusty old consumer brand territory as shelves start filling up again. --- I only have a drink or 2 once a month or so but I have to draw the line at generic beer, wine & liquor (for now). Link to comment Share on other sites More sharing options...
Cigarbutt Posted April 26, 2020 Share Posted April 26, 2020 ^The on-the-ground assessment fits with overall trends and Wakefern seems to be on top of the wave here. https://www.foodnavigator-usa.com/Article/2019/12/17/Bowl-Basket-private-label-range-will-help-to-redefine-how-customers-see-ShopRite An interesting aspect is that, on top of the obvious advantage for the price-conscious customers looking for value, private label brands have been able to catch on with another growing group of customers who are attracted to the words grocers include in their brands (Kroger’s "Simple Truth", "Nature’s Promise" and Albertsons "O Organics" etc). It gives a local feel that community dwellers may learn to appreciate. Also they've improved the presentation of the products and control the shelf space so... Link to comment Share on other sites More sharing options...
Gregmal Posted April 27, 2020 Share Posted April 27, 2020 Yea I know as early as December/January(before this whole shitshow started) they were bringing these brands out, but the shelf space was confined to that of a niche product. My suspicion, is, knowing from stupid small chat over the years with a few different managers at these places, how data driven they are, that they'll basically push until it's maxed. So effectively accrete towards being an Aldi or whatever to the greatest extent they can, without comprising other sales. Certain things it's just inevitable, even outside of a recessions. Who is paying $4.49 for 14 oz of Frosted Flakes when generic store brand is $1.79 for 24oz? Or $2.99 for hot dog buns vs .99c? Can of corn? $1.59 vs .67c? There are a few exceptions, for instance I'd never buy store brand shredded cheese. Some of them you can legit microwave for 10 minutes and see no difference in it. I think they key with store brands is to make it acceptable to buy as a consumer. The decision is rather obvious, but at the same time people dont want to feel like total cheapskates or losers not buying "Kraft Mac and Cheese" just to save 49c. The redesign, I agree is much better. Target also did a good job with this. This virus may have even been a perfect catalyst as with shortages everywhere, people are forced to buy the store brands, and see that they are actually quite good. The fear with a lot of supermarkets for years has been this Aldi threat and it seems at least as far as I can tell that the Shop Rite companies are stealthy transforming their company without missing a beat. Compared to another public company like Weis who just sits there holding price and banking on perpetual indifference. I am just amazed at how well they've stayed stocked and how the stores are always full. I have all but stopped going to the Stop N Shop by me as its been perpetually barren for weeks now. The employees there seem disgruntled as well, whereas the Shop Rites I see, its enthusiastic young kids working up front and then the lifers doing produce/dairy/meats/etc and interesting to note, within the various franchises, many actually work at multiple stores. IE Mon-Wed at location A, Fri-Sat location C; they are actively shifted based on demand, just another sign of a very well and actively managed establishment. Some of these are Village stores and some of them are Ronetco stores, but from what I can tell, they all kind of work together. Link to comment Share on other sites More sharing options...
DooDiligence Posted April 28, 2020 Share Posted April 28, 2020 It's funny that branded pet foods face virtually no generic competition while brands for humans are being overrun by store label products. www.grocerydive.com/news/feeding-fido-food-brands-sniff-out-opportunities-in-the-pet-market/533743/ --- I wonder if we'll start seeing more stores go to the dogs (and successfully attract pet parents)? www.veterinarypracticenews.com/walmart-launches-store-brand-premium-dog-food/ Link to comment Share on other sites More sharing options...
DooDiligence Posted May 12, 2020 Share Posted May 12, 2020 This is the only up to date info I can find on the progress of the new stores. Experiencing the normal bumps of a turnover but on track overall. www.westsiderag.com/2020/05/08/new-fairway-owners-say-technological-bumps-will-be-fixed www.westsiderag.com/2020/05/07/changes-at-fairway-raise-fears-that-new-ownership-is-shifting-policies The comments provide color. Link to comment Share on other sites More sharing options...
DooDiligence Posted June 7, 2020 Share Posted June 7, 2020 Good news from tight lipped management. www.winsightgrocerybusiness.com/retailers/village-comps-profits-soar-q3-chain-adjusts-covid-crisis --- Recent 10Q: www.sec.gov/Archives/edgar/data/103595/000010359520000019/vlgea2020042510-q.htm --- Easier to read format of managements D & A, https://www.marketscreener.com/VILLAGE-SUPER-MARKET-INC-11301/news/VILLAGE-SUPER-MARKET-MANAGEMENT-S-DISCUSSION-AND-ANALYSIS-OF-FINANCIAL-CONDITION-AND-RESULTS-OF-OP-30723219/ Link to comment Share on other sites More sharing options...
DooDiligence Posted July 24, 2020 Share Posted July 24, 2020 Fairway BK looks like it's winding down & Bogopa appears to get a bargain basement deal which may be what they wanted in the 1st place? www.winsightgrocerybusiness.com/amp/retailers/food-bazaar-buy-2-fairway-units-others-close "Bogopa, the upstart multiethnic grocer, is acquiring the units for little more than their equipment and inventory, documents show. The Red Hook store—which opened to great fanfare 15 years ago—became something of a white elephant for Fairway. Although its setting in a restored waterfront warehouse providing views of New York Harbor, lower Manhattan and the Statue of Liberty was spectacular, its status as a destination was kneecapped after extensive flood damage from Superstorm Sandy in 2012 forced a monthslong closure, and a subsequent opening of Brooklyn’s first Whole Foods unit in the easier-to-reach Gowanus neighborhood in 2013 picked off many of its regular shoppers. A pricey rent at the unit, and subsequent competitive openings from Whole Foods, Trader Joe's and finally Wegmans in Brooklyn, also weighed on the Red Hook unit, Fairway said. Bogopa has proposed taking over the unit, paying $5,000 for equipment and fixtures and an estimated $875,000 for inventory. It has also agreed with the store’s landlord on terms of a new lease for the store. Bogopa has also agreed to lease adjustments with the landlord of the Douglaston store—a former Waldbaum's unit in the northwestern part of New York’s Queens borough that opened as a Fairway in 2011. Bogopa has agreed to pay Fairway a $100,000 base price for that store, along with an estimated $800,000 for its inventory." "Fairway locations not yet sold include Westbury and Plainview, N.Y.; Harlem, N.Y.; and Stamford, Conn. — which have closed, or will close shortly, according to filed lease rejections, and state WARN (Worker Adjustment and Retraining Notification Act) notices." Link to comment Share on other sites More sharing options...
Cigarbutt Posted August 15, 2020 Share Posted August 15, 2020 Grocery stores are not exciting but have been doing well lately, a trend that may persist for a while. An interview with Kroger's Chairman and CEO, which has some relevance to VLGEA: https://www.goldmansachs.com/insights/talks-at-gs/rodney-mcmullen.html BRK's 13F-HR released yesterday reveals that Goldman Sachs is gone but Kroger is up. Topics of interest: the "hybrid" customer and the digital experience, moat related to vertical integration and risks of supply chain disruptions, inventory management, private labels, the potentially enduring forces that will encourage to eat at home, authentic desire to please the customer etc ----- Irrelevant addition The Columbia study (and related comments) Mr. McMullen refers to are interesting but many people have stretched the conclusions (correlation versus causation etc). Simply trying or advocating to increase the number of meals taken together is unlikely to work. The idea is to unite the criteria that lead people to eat together. Pandemics and other external shocks may contribute. ----- Link to comment Share on other sites More sharing options...
DooDiligence Posted August 16, 2020 Share Posted August 16, 2020 Grocery stores are not exciting but have been doing well lately, a trend that may persist for a while. An interview with Kroger's Chairman and CEO, which has some relevance to VLGEA: https://www.goldmansachs.com/insights/talks-at-gs/rodney-mcmullen.html BRK's 13F-HR released yesterday reveals that Goldman Sachs is gone but Kroger is up. Topics of interest: the "hybrid" customer and the digital experience, moat related to vertical integration and risks of supply chain disruptions, inventory management, private labels, the potentially enduring forces that will encourage to eat at home, authentic desire to please the customer etc ----- Irrelevant addition The Columbia study (and related comments) Mr. McMullen refers to are interesting but many people have stretched the conclusions (correlation versus causation etc). Simply trying or advocating to increase the number of meals taken together is unlikely to work. The idea is to unite the criteria that lead people to eat together. Pandemics and other external shocks may contribute. ----- Investment in home delivery & pickup is really paying off. Supply chain initiatives played a big role in keeping things moving. Home based meal trends post covid? People like restaurants. They also like quick grocery shopping & delivery. --- Plant based product sales are growing & McMullen believes this is a trend & not just a fad. People simply eating less meat. https://news.gallup.com/poll/282779/nearly-one-four-cut-back-eating-meat.aspx Hodling on to Village. Link to comment Share on other sites More sharing options...
DooDiligence Posted August 21, 2020 Share Posted August 21, 2020 Is it possible to get blood out of a turnip? or Will you simply make the turnip cease & desist? https://nypost.com/2020/08/05/fairways-new-owner-says-ex-owner-trying-to-steal-its-customers/ --- Not really relevant to the success of Village, but I find the saga interesting. On another note, I wonder if Bogopa will be able to do something interesting with the Redhook property? Link to comment Share on other sites More sharing options...
Cigarbutt Posted March 4, 2021 Share Posted March 4, 2021 Slow and steady may win the race (at least some of the races). "Same store sales increased due primarily to increased customer demand across most stores due to the impact of the COVID-19 pandemic. We continue to experience higher average basket sizes and decreased transaction counts as customers consolidate shopping trips. Digital sales growth accelerated through both ShopRite from Home and partnerships with online grocery picking and delivery services..." An interesting aspect is that some of the benefits from the pandemic may go back to a more secular trend but this will likely be compensated from the revelation of normal earning power in the new Manhattan-based acquisition. Link to comment Share on other sites More sharing options...
DooDiligence Posted March 4, 2021 Share Posted March 4, 2021 Slow and steady may win the race (at least some of the races). "Same store sales increased due primarily to increased customer demand across most stores due to the impact of the COVID-19 pandemic. We continue to experience higher average basket sizes and decreased transaction counts as customers consolidate shopping trips. Digital sales growth accelerated through both ShopRite from Home and partnerships with online grocery picking and delivery services..." An interesting aspect is that some of the benefits from the pandemic may go back to a more secular trend but this will likely be compensated from the revelation of normal earning power in the new Manhattan-based acquisition. Like watching paint dry. I'm OK with it though. Researching stonks eats too much into my practice time. Link to comment Share on other sites More sharing options...
DooDiligence Posted March 8, 2021 Share Posted March 8, 2021 Slow and steady may win the race (at least some of the races). "Same store sales increased due primarily to increased customer demand across most stores due to the impact of the COVID-19 pandemic. We continue to experience higher average basket sizes and decreased transaction counts as customers consolidate shopping trips. Digital sales growth accelerated through both ShopRite from Home and partnerships with online grocery picking and delivery services..." An interesting aspect is that some of the benefits from the pandemic may go back to a more secular trend but this will likely be compensated from the revelation of normal earning power in the new Manhattan-based acquisition. Thanks for the reminder. I'd been putting off looking at this. There's a lot to be said for reports that are easy to read. I do wish there were more pictures though :) --- Revenues up just short of 20% YoY with the addition of the Fairway stores, and net income increased 15% for the past 26 weeks. "Demand remains high in most stores, however sales at Fairway and Gourmet Garage locations in Manhattan have been significantly negatively impacted due primarily to residential population migration out of the city and less commuter and tourist traffic during the COVID-19 pandemic." "Net income was $7,916,000 in the 26 weeks ended January 23, 2021 compared to $4,572,000 in the 26 weeks ended January 25, 2020. The 26 weeks ended January 25, 2020 includes a non-cash pension charge related to the termination of a company-sponsored pension plan and other pension settlement charges of $871,000 (net of tax), pre-opening costs related to the Stroudsburg, Pennsylvania replacement store of $891,000 (net of tax) and store closure costs and charges to write off the lease asset and related obligations for the old Stroudsburg store of $557,000 (net of tax). Excluding these items, net income increased 15% in the 26 weeks ended January 23, 2021 compared to the prior year. Net income increased due to increased same store sales partially offset by lower sales volumes in Manhattan and higher costs as we transition and integrate commissary operations into our business." Gross & net margins don't appear to be changing much which bodes well for the integration of newly acquired stores. Historically, new builds & acquisitions within the industry experience a bumpy ride until operations get rolling. Will be watching to see if extra expenses appear in the upcoming quarters. For now it appears the new stores actually contributed a tiny bit to margin expansion & existing stores actually contracted for a tiny offset. SSS increase of around 6% & ShopRite from Home sales growth increased 170%+ Overall, a good result. I'll keep waiting for the paint to dry. Might sell a few shares if I see them approaching $30 & other opportunities are available. Link to comment Share on other sites More sharing options...
DooDiligence Posted April 9, 2021 Share Posted April 9, 2021 It takes a loooooong time to get approvals for projects in New Jersey. https://pressofatlanticcity.com/news/local/atlantic-city-supermarket-remains-in-predevelopment-stage/article_07e8560f-9de5-5358-bad8-0f423be59edb.html You'd think they might speed up the process in Atlantic City due to the high unemployment rate but... www.casino.org/news/atlantic-city-amid-housing-boom-as-regions-gaming-industry-struggles/ Link to comment Share on other sites More sharing options...
Cigarbutt Posted April 9, 2021 Share Posted April 9, 2021 1 hour ago, DooDiligence said: It takes a loooooong time to get approvals for projects in New Jersey. https://pressofatlanticcity.com/news/local/atlantic-city-supermarket-remains-in-predevelopment-stage/article_07e8560f-9de5-5358-bad8-0f423be59edb.html You'd think they might speed up the process in Atlantic City due to the high unemployment rate but... www.casino.org/news/atlantic-city-amid-housing-boom-as-regions-gaming-industry-struggles/ i've been to Atlantic City a few times (not for a while though) and it never seemed like an ideal place to develop new grocery retail space. However, it's a food desert and there may be a long term opportunity there. Specifically, there may be a market for locals and the potential for SNAP use is high. They also plan to include a job training center (i assume it's a staffing agency) in their new building and, from an on-the-ground perspective in my area, there is potential there too. Link to comment Share on other sites More sharing options...
DooDiligence Posted April 9, 2021 Share Posted April 9, 2021 (edited) 58 minutes ago, Cigarbutt said: i've been to Atlantic City a few times (not for a while though) and it never seemed like an ideal place to develop new grocery retail space. However, it's a food desert and there may be a long term opportunity there. Specifically, there may be a market for locals and the potential for SNAP use is high. They also plan to include a job training center (i assume it's a staffing agency) in their new building and, from an on-the-ground perspective in my area, there is potential there too. The last time I was there was in the late 90's to mobilize a vessel for a subsea cable lay in the Caribbean (the divers were based in New Jersey), and I was surprised at the squalor. I kind of questioned the location as well but the article mentions that a portion of the space would be used for "mico-fulfillment center that would use robotics to carry out online orders". https://medium.com/hngry/breaking-down-the-nations-first-robotic-grocery-fulfillment-center-387907b75ae9 "Overall, this is an incredibly laborious process that is just a toe into the rough waters of grocery delivery for Wakefern, the largest private employer in New Jersey. Today, the center fills an average of 400 orders per day across five stores, reaching a peak of 1,000 during Thanksgiving." --- www.wsj.com/articles/grocery-delivery-goes-small-with-micro-fulfillment-centers-11580121002 It's nice to see Wakefern is working as hard as the big guys on this. They must know that they have to or Amazon will eat their lunch. --- I tend to trust management. They know the market and seem to have made some good moves lately. Edited April 9, 2021 by DooDiligence Link to comment Share on other sites More sharing options...
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