Shopping The Stores -- Market Conditions -- Wide-Ranging Survey Takes A Look At Price, Quality And Selection At 18 Seattle-Area Stores
CUTLINE: CRAIG FUJII / SEATTLE TIMES: SHOPPERS LOOK OVER THE PRODUCE AT AN AREA GROCERY STORE. THE TIMES' SURVEY INCLUDED A PANEL OF JUDGES EXAMINING FRESH FOOD FROM VARIOUS AREA GROCERY STORES.
Shopping for groceries - just about all of us do it. But how informed are we about our supermarket choices? In a four-part series beginning today, The Seattle Times takes a consumer's look at the area's grocery industry by focusing on 18 selected stores.
We compared prices: Smucker's strawberry jam, 18 oz., as high as $2.79 at Roger's Thriftway and Larry's Market, Totem Lake; as low as $2.49 at four QFCs and Safeway, Kirkland.
We checked fresh-food quality: Highest-rated boneless chicken breasts: Safeway, Kirkland, and Albertson's, Renton Highlands (``good pink color, well trimmed''). Lowest: Albertson's, Kirkland (``smell very tainted'').
We checked overall supermarket appeal: Our consultant liked a lot he saw (``Queen Anne Thriftway offers the best self-service fish department I've seen anywhere'') and disliked a lot (``Safeway Holly Park is not being fair to the customers in this 1950s-style store'').
These price and quality surveys were part of a project undertaken by The Seattle Times with a simple - but not so simple to accomplish - goal:
To capture a ``snapshot'' that would give an idea of the range of prices and quality found in Seattle supermarkets on any given day.
The project involved detailed research to design a fair and meaningful survey format; the hiring of a supermarket consultant to evaluate overall supermarket quality and appeal; a one-day price-checking and shopping blitz of the stores by 18 staff members; and quality testing by experts of the fresh food our shoppers purchased.
Now, while we don't pretend to have the final word on supermarkets, we do believe we can deliver some useful consumer information to you.
We launched the project with these questions in mind:
-- What kinds of price and quality strategies do supermarket chains practice, and why?
-- Do individual stores within the same chain offer better prices or quality than others? What could explain any differences?
-- Is there any pattern to where the better supermarkets are located?
-- How competitive are Seattle-area supermarkets? How does the competitive picture affect price and quality?
The project focused on 18 stores (four Albertson's, Safeways and QFCs; two Stock Markets; two Thriftways; one Larry's Market; one Fred Meyer). Stores were chosen primarily for geographical diversity, with an eye toward including stores considered to be among a chain's best, average and less stellar (some of the chains, however, dispute whether the stores we selected made up a fair representation). We also looked for stores in areas of limited competition, as well as in competitive areas. And we selected several independents of different types.
A chart on K 9 details the survey results, including: each store's price for the sample market basket; its score on a fresh-food blind test by a panel of food experts; a grade on overall quality; comment from our consultant, a recently retired president of a respected Midwestern supermarket chain. The chart also explains how we carried out the surveys.
What follows is a summary of survey highlights.
Prices
Highs and lows
Our sample market basket, made up of 59 items, cost an average of $112.03. The most expensive, at $116.30, was Larry's Market in Totem Lake. Larry's was followed closely (less than a 15-cent spread) by the Safeways in Holly Park and Pine Lake. In fact, six of the most expensive stores were within $1 of Larry's.
The least expensive was Fred Meyer, Kirkland, which at $103.92 was more than $12 lower than Larry's.
Comparing chain prices
Of the three major chains, Albertson's was by far the lowest in average price, followed by QFC, then Safeway. An indication of how low Albertson's prices were: Its most expensive store of the four we checked, in Renton Highlands, was still $3.08 cheaper than the least expensive QFC surveyed, in Kirkland.
The two stores of the Stock Market discount chain (bag-your-own) both had three Albertson's stores beat; the fourth Albertson's, in Edmonds, was lower than the Stock Market stores.
Fred Meyer, Kirkland, the lowest of all 18 stores, was lower than Albertson's, Edmonds, by $1.07.
Competitive Kirkland
Does heightened competition drive prices down? We tried to measure this by selecting a cluster of stores in Kirkland, which had the highest number of major stores in a single ZIP code. The average market basket there, $111.68, was slightly lower than for stores outside the cluster, $112.16.
In-chain price differences
You might think all stores within a chain have the same prices, but that's not so. At Albertson's, only 19 of the 59 items had the same prices at all four stores. At Stock Market, that was the case with 37 items, at QFC 45 items and at Safeway 46 items.
Why the variation from store to store? Store executives say it's because:
-- Individual managers have leeway to run specials, depending on such factors as area competition or the need to move perishables quickly.
-- Larger stores sometimes obtain cheaper prices on certain items from distributors because they can buy larger volumes; they also can stock up on sale items. They can buy more because they can sell more, and because they have more storage room.
Note: Not reflected by the price survey is the impact of promotional coupons, which some stores, such as Safeway, often run in advertising inserts in some areas. The coupons enable shoppers to reduce their overall bills.
Suburban vs. city prices
Prices in the suburban stores as a whole were lower than in their in-city counterparts, $111.07 vs. $113.23, a 2 percent difference. For the average American family of four, who spends $4,732 a year, the difference would amount to nearly $100 annually.
Industry executives say it's because suburban stores tend to be larger, and larger stores can make bigger - and thus better - buys.
Indeed, there seems to be a relationship between size of store and prices. The average market basket among the nine largest stores was $109.82; among the nine smallest it was $114.23. For that same family of four, this 4 percent difference would be about $190 a year.
Seattle vs. national prices
Seattle-area grocery prices are about 10 percent higher than the national average, according to a national Chamber of Commerce cost-of-living index of 291 urban areas. A basket of items that would cost $110 in Seattle would cost $103 in Los Angeles County; $118 in New York City; and $93 in Greensboro, N.C.
Industry experts commonly cite several reasons:
-- Seattle-area shoppers traditionally have been more concerned with quality of food and service than with price.
-- Safeway has been so dominant here - it has the most stores by far and a market share of 30-plus percent - that for competitive reasons stores traditionally have not deviated too far from the prices Safeway sets.
-- Depending on the product, freight costs can be higher because of our relatively remote location.
-- Wages in stores here, which are almost all unionized, are high compared with, say, the mostly non-union South.
-- We don't have as many cut-rate, totally price-oriented chains as other parts of the country have.
-- There's a lack of large parcels of land, and what land is available is expensive. This discourages rival chains from entering the market and hinders the growth of high-volume discounters, such as Costco.
-- Because of limited, difficult terrain - lots of bridges, lakes, hills - competing stores rarely are at the same intersection. This makes it inconvenient for shoppers to comparison shop easily and switch.
Quality
Consultant's grades
Consultant Michael Knilans, recently retired president and chief executive officer of a major Ohio chain, Big Bear Inc., found that the 18 stores included some as good as any in the U.S. But as a group they could be better, said Knilans, who is a former member of a research group that critiqued supermarkets around the country and is a founding board member of the Food Marketing Institute.
His average grade of all stores: just above a B-minus, or 7.28 on a 12-point scale. (See chart.)
Knilans found that overall quality and appeal within chains varied among the 18 stores we surveyed. Safeway grades ranged from B to D; QFCs from A to D; Albertson's from B-plus to C; Stock Market had a B and C.
He suggested that the stores as a group would be better if competition were stiffer. Despite the large numbers of stores here, the lack of side-by-side stores lessens that competition, he believes.
Also, the lack of land means more of our stores - generally the in-city ones - are smaller than is true nationally. Bigger isn't necessarily better, but allows for such amenities as pharmacies.
Blind fresh-food test
In another measure of quality, we had a panel blind-test 11 fresh items, such as produce and seafood. The panel members were Greg Fazzini, executive chef of the Warwick Hotel's Liaison Restaurant; Jan Grant, King County Cooperative Extension food specialist; and Charlene Howson, food educator, stylist and caterer. Each represented a shopper more knowledgeable and discriminating than the average person.
Interestingly, some stores that did well by Knilans' measure of overall appeal didn't shine as brilliantly in this food test. On the other hand, some stores that Knilans graded lower - perhaps for dirt, old equipment, unfriendliness or a lackluster deli - were judged to have some good fresh foods.
As a group, the stores' scores on the blind test were not overly impressive: The average overall rating was 2.71 out of a possible 5.
Price vs. quality
Paying higher prices can sometimes mean getting better quality, but not in all cases.
Among the five most expensive stores, only one, Larry's, got at least an A (actually, Larry's got an A-plus) for overall appeal. The next highest grade among the five was a B (Safeway, Pine Lake). And none of the five most expensive were among the five best in the blind-testing of fresh foods.
And the lowest-priced store of all, Fred Meyer, Kirkland, got an A from Knilans, who liked its variety and presentation. On the fresh-food test, however, it received a below-average score.
But that doesn't rule out a relationship between price and quality. Among the five stores that got A's or better, four were above the average market basket price. Only Fred Meyer, Kirkland, was below.
Of the six stores that had the top scores in the fresh-food test, only two - Albertson's, White Center, and Stock Market, Federal Way - had a below-average market basket price.
Suburbs vs. in-city quality
Quality was a little better in suburban stores, on average, than in city stores. On the fresh-food test, suburban stores averaged a 2.75, while city stores averaged 2.67.
By Knilans' grade, suburban stores averaged above a B (8.2 on a 12-point scale), while city stores averaged above a C-plus (6.13).
Competitive Kirkland
Quality was not as clear-cut an issue here. In the fresh-food test, stores in the Kirkland cluster had a worse average score than stores outside the cluster. By Knilans' grades, however, in-cluster stores did better.
Stores respond
We spoke with the top local executives of all the 18 stores, showed them the survey results and asked for their comments.
Their more detailed responses (along with the store-by-store comments by Knilans) will be in tomorrow's Seattle Times. What follows is a summary of their major points.
Albertson's: The company's executives said the four stores we selected were ``not a good representation of the trend of Albertson's stores today.''
The Edmonds store is set for remodeling ``soon,'' and the company will remodel or replace White Center, said Curt Lerew, vice president, Western Washington division. The prototype of future Albertson's is its new Monroe store, Lerew said. The Kirkland store, included in the survey and now being remodeled, is a smaller version of the prototype.
Lerew also said that ``stores can vary from day to day. We do similar unannounced checks on our own stores.'' He added that the blind-test scores ``seem very low.''
QFC: Quality Food Centers Inc. would have preferred that we included one of its new stores, such as the one at Crossroads Shopping Center in Bellevue, said Dan Kourkoumelis, president and chief operating officer.
However, Kourkoumelis said he believed the selected stores were a representative cross-section.
Safeway: Tom Keller, senior vice president and division manager, said the four Safeways surveyed weren't ``a true representation of our stores now.'' Three (not including Pine Lake) were among Safeway's older stores, and those three are smaller than the average Safeway store in the Seattle area; Pine Lake is considerably larger.
Safeway's newest local store, in Woodinville, represents the company at its best and indicates what shoppers can expect in future stores, Keller said.
Keller said Safeway is performing a community service by remaining in the Rainier Valley - a lower-income area other major chains have left or never served. He said the Holly Park store is too marginally profitable to warrant a remodeling, though it was recently repainted. But Safeway has applied for a city permit to make a higher-traffic Rainier Valley store, in a somewhat higher-income area, into a superstore.
The Crown Hill store is due for remodeling in the next several years, he said.
Larry's Market: Larry McKinney, president of Larry's Markets, said he was disappointed in the store's score on the fresh-food test (2.70, just about average) and said he would have felt more comfortable had the test been done twice, on separate days. ``I feel confident that day in and day out our quality is unsurpassed,'' he said. ``While it may not be every day we certainly strive to make it so and will continue to do so.''
Store executives also believe the price information would have been fairer had the fresh foods - where higher price might represent a more expensive, better grade of item - been broken out from items that are uniform, such as Smucker's jam.
Stock Market: A. Keith Uddenberg, president of Keith Uddenberg Inc., parent company of Stock Market, said, ``We're always interested in constructive criticism,'' but said the two selected Stock Markets were among its older stores. The company's new stores, in Kent, Everett and Bonney Lake, he said, would be ``representative of the stores we're doing now.''
;
PRICE COMPARISONS;
;
STORE MARKET BASKET TOTAL;
;
Larry's Market Totem Lake $116.30;
Safeway Holly park $116.23;
Safeway Pine Lake $116.17;
Roger's Thriftway $115.75;
Safeway Kirkland $115.51;
Safeway Crown Hill $115.31;
QFC Gateway $114.43;
Queen Anne Thriftway $114.31;
QFC Bellevue Village $114.23;
QFC Northgate $114.17;
QFC Kirkland $113.64;
Albertsons;
Renton Highlands $110.56;
Albertson's Kirkland $109.04;
Albertson's White Center $108.76;
Stock Market Rainier Beach $106.89;
Stock Market Federal Way $106.31;
Albertson's Edmonds $104.99;
Fred Meyer Kirkland $103.92