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The Sacramento Business Journal reports on the new Raley’s store opening this week in Sacramento, noting that it will “introduce some new departments and services, and continue the roll-out of other relatively new offerings.”

Among other things, the store will feature a stand-alone sub sandwich shop in front of the unit; a service-driven gourmet cheese island; a self-serve counter with hot Chinese food; self-checkout lanes; and a gas station. According to a company spokesman, Raley's hopes to cater to the lunch and dinner crowd looking to get in and out quickly.

Meanwhile, Raley’s CEO Bill Coyne is the subject of a profile in the Sacramento Bee that looks at how the company, “recognized by many as one of the better chains in the industry…is struggling to increase its market share and faces competition from discounters, club outlets and others that use the grocery aisle as a loss-leader to pull in customers.”

Coyne tells the Bee that while Wal-Mart’s impact on the marketplace cannot be exaggerated, in many ways the company’s bottom line is more vulnerable to attacks by the likes of Costco, Trader Joe’s and Whole Foods. “If you look at Costco, for example, their customer actually lines up very well with the profile of a Raley's-Bel Air customer: higher education, higher income, larger families,” Coyne says. “Trader Joe's is a factor, certainly, because those are also our customers. But I have a little bit of a contrarian view. I actually think companies like Trader Joe's and Whole Foods are good for us in a sense that they challenge us to be better, but, more importantly, they educate our consumers about what's available, what's new, what's best.”

As for future grow potential, Coyne says, “Our focus now is to build from our base. Time will determine whether we venture beyond that because right now, frankly, there aren't many good acquisition opportunities available. So we're not spending a lot of time looking to go into Washington or Oregon, because those opportunities are just not there. In three to five years, will there be? Perhaps. I like to think that we'll be agile enough and ready to do something like that.”
KC's View:
We think that it is good to have a contrarian view, and expect that Raley’s will continue to perform well as long as the company is focused on what he calls “compelling connections” to shoppers, employees and their communities. We’ve always thought that that phrase, as used by Coyne (at the FMI Midwinter Executive Conference), is a good one – because to be anything less than compelling is to simply not be good enough.