As Fairway Markets announced yesterday that its 2015 Q4 sales, same-store sales, and same-store customer transactions were down, it looked to distract attention from the company's continuing decline with news about a new and smaller store format.
Jack Murphy, CEO at Fairway, said in a prepared statement, "We are excited about the announcement of the new Fairway Market located in a densely populated submarket with ample parking in a dynamic section of Brooklyn. This location will be the prototype for our new store model. It will have a smaller footprint and lower cost structure than our existing stores with the same broad offering of fresh, specialty, organic and conventional products.
"We expect to further improve the profitability of the store by optimizing space allocations between departments based on learnings from recently conducted productivity studies. We have also spent a lot of time designing a more capital efficient store and believe that we can build this store with a lower cost per square foot than our existing locations. We will continue to remain focused on searching for high quality locations which we believe will be accretive to our long term growth strategy."
Jack Murphy, CEO at Fairway, said in a prepared statement, "We are excited about the announcement of the new Fairway Market located in a densely populated submarket with ample parking in a dynamic section of Brooklyn. This location will be the prototype for our new store model. It will have a smaller footprint and lower cost structure than our existing stores with the same broad offering of fresh, specialty, organic and conventional products.
"We expect to further improve the profitability of the store by optimizing space allocations between departments based on learnings from recently conducted productivity studies. We have also spent a lot of time designing a more capital efficient store and believe that we can build this store with a lower cost per square foot than our existing locations. We will continue to remain focused on searching for high quality locations which we believe will be accretive to our long term growth strategy."
- KC's View:
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It's funny. I swear, yesterday morning I was jogging by a now-closed automobile dealership on the Boston Post Road in my town, and I thought to myself that if another car company does not go in there, it'd make a great site for a food store ... and I actually thought to myself that it'd be an interesting place for a smaller format Price Chopper or Fairway.
There's no question, it seems to me, that regardless of the size of its stores, fairway has lost some of the magic that seemed to infuse the company when it was being run by the founding Glickberg family. It's gone through an investment by a private equity group and an IPO, and somehow seems to have lost the momentum that made it such a hot format for so long.
I'm not sure a small format is the solution ... at least not if it represents a financial calculation as opposed to a consumer-driven marketing move.
