I looked cover to cover in Sunday’s Philadelphia Inquirer for the article on Genuardi’s, but nothing. However this morning the article appears on the front page of today’s paper! An interesting article, the writer explains the dynamics of the supermarket world, in particular the downturn of Genuardi’s grocery chain and the threat that Wegmans poses to local supermarkets. I was so excited to see ‘Community Matters’ get a mention – it’s validating, especially because there are some who may question the value (or influence) of a blog.
With a root canal scheduled for later this morning, I will take this as a good omen for the day!
Genuardi’s is closing another supermarket
By Kathy Boccella
Inquirer Staff WriterHere we go again.The venerable Genuardi’s supermarket chain is closing another store. This time it’s the Towamencin Village Square market in Lansdale, which will shut down Saturday, nearly 20 years to the day after it opened. Lately, it seems as if every month brings a new Genuardi’s closing. Last spring, the Voorhees store went out of business, followed by one in the Edgemont Square Shopping Center in Newtown Square in July and two in August – in Tredyffrin’s Chesterbrook community and the Glen Eagle Shopping Center in Concord.
The problem for Genuardi’s is that Philadelphia is “overstored,” said Richard George, a professor of food marketing at St. Joseph’s University. From Walgreens to Wawa to Wegmans, a bounty of food retailers is making it hard for traditional stores to stay afloat.
“There are too many stores selling food in too concentrated an area,” said Jeff Metzger, publisher of Food Trade News, a food-industry publication.
Genuardi’s spokeswoman Maryanne Crager agreed that the competitive array was staggering. “At one time a drugstore might have one little aisle with chips. Now they sell yogurt, cheese. Everybody is trying to get a piece of the pie, and the pie is only so big,” she said, citing such nontraditional food sellers as Target and CVS.
With the latest closing, Genuardi’s now has 31 supermarkets in Pennsylvania and New Jersey, down from 39 when monster food company Safeway Inc. bought the chain from the family of founder Gaspare Genuardi and his wife, Josephine, in 2001. The Lansdale store, whose lease expires at the end of the month, was closed because it was not as profitable as expected, Crager said. The company will try to find openings at other Genuardi’s for the store’s 45 employees, as it has done at previously shuttered markets, but not everyone is able or willing to relocate, she said. She would not say how many workers had been laid off.
The job outlook, not surprisingly, is not great. Wendell W. Young IV, president of United Food and Commercial Workers Union Local 1776, said grocery stores had slowed or stopped hiring to offset lower profits.
Many of the new stores coming into the region are lower-end markets that pay minimum wage. And most supermarket employees are part time, working 25 to 30 hours a week, he said.
While Genuardi’s is downsizing, another chain is cementing its reputation as a local category killer. Wegmans, whose massive take-and-go prepared-food sections are magnets to busy suburbanites, opened a 130,000-square-foot megastore in Malvern in July, bringing to six the number of regional Wegmans, three of them in the greater King of Prussia area. Wegmans and other upscale niche retailers such as Trader Joe’s and Whole Foods are muscling out middle-of-the-road supermarkets such as Genuardi’s, say the experts.
“Pathmark is closing, Super Freshes are closing. It’s that big middle that are neither the low-price guy like Wal-Mart and Save-A-Lot, yet don’t have the cachet of Wegmans and Trader Joe’s,” George said. “So people say, ‘Why do I shop there?’ ”
At Genuardi’s in Lansdale, few were shopping on a recent afternoon, despite a 20 percent-off sale that had already cleaned out many aisles. Employees looked as grim as pallbearers.
“It’s very, very sad,” said customer Nancy Demetrius, a mother of four who lives around the corner from the supermarket and says she shops there once or twice a week. “They’re very nice people here, very helpful.” She was picking up milk and chili fixings with her 3-year-old daughter, Camryn. The family did most of its shopping at Genuardi’s, she said, even renting movies at the Red Box out front. “At parties, if we needed rolls, soda, we’d run to Genuardi’s,” she said. She said she would miss the quality of the meats and produce. “Excellent, excellent.” Her children will miss the free cookies from the bakery.
The Lansdale area is a microcosm of the “overstore” phenomenon. There is a Super Fresh less than a mile away, although that, too, is closing, and an Acme and Giant nearby. A new ShopRite is expected to rise not far from Genuardi’s. Demetrius said she would probably shop at Giant. “It’s cheaper, but the quality is not as good,” she said. “You do what you have to do.”
Though the Lansdale store seemed robust to shoppers, other locations languished before finally going dark. The Chesterbrook Genuardi’s in Tredyffrin was “dated” and not maintained, said Pattye Benson, a Malvern bed-and-breakfast owner, who raves on her Community Matters blog about the gelato kiosk, 800 kinds of beer and large take-out section at the new Wegmans.
“Safeway took absolutely no interest in maintaining that store. . . . It just went downhill,” she said.
For many people, Genuardi’s was never the same after the corporate giant bought it from Gaspare and Josephine’s children, who transformed their vegetable garden in Norristown into one of the area’s most beloved businesses.
The company replaced many favorite Genuardi’s brands with Safeway products and downgraded two benchmarks of the Genuardi’s stores – produce and deli items, Metzger said. The Genuardi family “ran that store with terrific products and tremendous customer service,” said George. Safeway “lost sight of the customer,” he said. “Genuardi’s,” he said, “used to stand for something.”
Still, some Genuardi’s stores are now busier than ever and offer more locally grown produce, as Gaspare and Josephine did in the old days. Smaller than many other market leaders, between April 2009 and March 2010 Genuardi’s was the fifth-highest-grossing supermarket company in the region, with 38 stores and $983 million in sales. The leader was ShopRite, whose 67 stores earned $2.6 billion, according to Food Trade News.
Wegmans’ six stores had $364 million in sales, making it the sixth-largest in the area. Companies showing the biggest decline were Acme, which lost its number-one post after 32 years, Genuardi’s, and Giant.
Crager said Genuardi’s had no plans to close more stores but acknowledged the challenges for the chain. Referring back to her pie analogy, she said: “Some of the slices for some operators are getting smaller and smaller. Obviously when you get smaller . . . it becomes more challenging to operate.”
On the bright side, “We’re part of a much larger corporation,” she said.
