The Associated Press reported that last Tuesday that the New York City based Rite Aid Corporation will add discount groceries to some of it’s South Carolina locations.
The decision was based on the company’s recent partnership with Supervalu Inc.
Supervalu’s unit, Save-A-Lot, has over 1200 locations in 31 states selling grocery products and household goods. Rite Aid will remodel and rebrand 10 of its locations under the Save-A-Lot name while removing many of its health and beauty products.
Rite Aid’s decision to rebrand some of its locations, by adding more grocery products in South Carolina is obviously a pilot program. Since the rebranding will only take place in a specific retail market, South Carolina. South Carolina, which has quite a low socioeconomic, standing in the United States. This is a great location for Rite Aid to attempt increasing it’s sales by switching from costly health and beauty products, which have a low mark-up value to cheap grocery products.
Despite mentioning the hardships of the recession I can’t help but mentioning that such a move by Rite Aid is clearly the company’s attempt to overcome the struggles of increasing sales at times where the consumer is on a bargain hunt.
I truly believe that this pilot will prove to be successful, and is a good example of a corporation’s ability and necessity to evolve along with the evolving retail industry.
By Michael Milner
Article source: http://online.wsj.com/article/SB10001424052748704358904575477832907868388.html?mg=com-wsj
This makes total sense. Food is one of the key things people need to live so it will always be purchased. Beauty products, however, we can forgo when the spending gets tight. When the market turns around, I am sure some of these stores are going to wish they had the beauty products again because they are more expensive which bring sin more sales.
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