Supermarket chains blind to walkable urban business opportunities
Many of DC's supermarkets turn long, blank walls toward the sidewalk. This space represents an enormous missed opportunity for retailing. Supermarkets like Manhattan's Fairway line their sidewalk frontage with produce stands. This draws customers into the store who see an appealing mango as they walk by, go inside, and end up buying a few items. Clearly, they've determined that any loss to theft pales in comparison to the profit in drawing more customers. Yet DC's supermarkets leave these spaces dead and unused.
Left: Fairway on Manhattan's Upper West Side. Right: Safeway on 17th Street in Dupont.
Photos by swruler9284 and M.V. Jantzen on Flickr.
It seems puzzling that stores ignore this obvious opportunity literally right in front of them. According to a developer who's tried to attract supermarkets to DC, our chains, like Safeway and Giant, cling to very suburban business models despite having many successful stores in the city. They primarily measure stores by their "average receipts", the average amount of money a customer spends on a single visit.
Adding small-ticket items like produce outside the store would bring in more customers and even more total profit, but decrease the average receipts. Despite raising the store's profits, the national headquarters would very likely see the change as diminishing the store's performance.
Most of New York's supermarket chains focus entirely or almost on that market. Fairway, Food Emporium, D'Agostino, Gristede's, C-Town, and others don't answer to suburban managers who measure their stores by the standards of the typical auto-dependent strip mall store. Many of these stores can operate successfully in small spaces, and are happy to locate half or more of their stores below ground or on the second floor. They know they don't need an enormous 20-foot-high sign. And even in buildings with no parking, they can thrive.
Meanwhile, Safeway largely neglects its Dupont Circle store. Safeway, Giant, and other regional chains, when negotiating to become anchor tenants of new developments, still insist on large facades facing the sidewalk, suburban-sized signs, and vast quantities of parking, often including parking reserved exclusively for the store's patrons.
It's not all bad. Even these same chains are thinking more creatively on some of their new stores. The new Georgetown Safeway will engage the sidewalk much more than existing Safeways. My developer source says that some chains are open to adding sidewalk vending. If those outside-the-DC-box examples succeed, then our supermarket chains will learn to incorporate these elements in other stores in less-rich areas. As with many large businesses, however, these chains move and change slowly. We may well have to wait a long time for them to wake up to profit opportunities in urban areas.
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