With consumer spending trends pointing downward, it is a wonder that independent retailers can survive at all. But California’s Gene’s Fine Foods has served generations by connecting with customers in a way most chain stores would envy.
Gene’s was started in 1928 in San Francisco and has remained family run ever since. Known as an upscale grocery store offering top quality products at the best prices available, there are two Gene’s locations: one in Saratoga and one in Pleasanton. The stores survive in an environment dominated by chain stores because its independence allows it to create an internal team-based culture and also allows it to react to new trends in the market and take care of consumers on a personal, day-to-day basis.
“We carry quality products. We have the brand names and staples so we can compete with the chains, but we have the gourmet, organic, and natural items throughout the store you won’t find at the chain stores to make us unique,” said Don Smejdir, VP and GM of the Pleasanton store.
For an entity like Gene’s, creating personal relationships with consumers is a must.
Boutique-ish, foodie items like international foods, herbs, and spices and regular weekend wine tastings give the locals an experience they just won’t get at a super chain store. Although there are some subtle differences between the consumer groups each store serves, Gene’s keeps a close eye on the categories that move in both locations to get a better idea of who the customer is in both markets.
Smejdir said his customers also appreciate the quality of items available, knowing they can put together a gourmet meal at half the price of going out to a restaurant. Highly trained personnel, from managers to floor staff, can help the customers with questions that generally won’t get the same responsiveness from the average chain store clerk.
“We have sent people out to food shows and seminars in the past, but most training is inhouse. When new items come in from suppliers, they will send us a rep to tell us about the nuances of the new items,” said Smejdir. “Employees get samples so they can tell customers what it is like, and it empowers them when they know about what they are selling.”
Staying on top of the market requires being on top of consumer trends. Smejdir himself will spend time on the floor, pouring at wine tastings and bagging groceries so he can hear directly from the people Gene’s serves. That way, when new items come in, the stores can see what moves and what doesn’t and get the flavor for the trends in the area and sort out the palette for particular customers to appease a wide variety of tastes.
Gene’s produce departments are large, have a wide variety for the size of the stores, and regularly conduct samplings and tastings. The meat departments have open counters so customers can see what goes on behind the scenes when staff breaks down lamb or filets fish right in front of them. Gene’s deli counters make macaroni and potato salads from scratch, conduct tastings, carry top of the line products like Boar’s Head meats, and make big sandwiches with a quarter-pound of meat. The stores also have sushi, salad, and olive bars, which may be typical amenities but at Gene’s feature higher quality products.
“Sushi is made from scratch all day long, not just dropped off and left there,” Smejdir said.
While customers are watching their pennies, Gene’s tries to offer the best deals and values for a complete meal. The stores run ads on meals on sale for the whole family, which helps customers realize Gene’s is trying to support them through trying economic times.
In fact, Gene’s grocery prices are often less than the Safeway’s of the world. The company’s wholesaler, Unified Grocers, is heavily involved with Gene’s and gives it opportunities for special volume purchases. Vendor-supplied product demo’s are also important for Gene’s and the vendor, as it helps both entities introduce items to the customer and move more merchandise.
To help spread the word, Gene’s puts out print ads and flyers, does radio advertising on multiple stations, and puts supplemental flyers in newspapers for specials. One recent supplemental showcased a 10-turkey giveaway and highlighted the fact that Gene’s only sells fresh turkeys.
The stores are also trying to find ways to save money through internal improvements. The company recently upgraded the lighting in the Saratoga store and is always making sure its compressors and freezers are running efficiently. Gene’s also recently upgraded the computer systems in both stores to be on par with the latest technology and began offering gift cards. But as for self-checkout aisles, Smejdir said that just isn’t Gene’s.
“We have that option, but we want to keep our personal, local grocer touch,” he said. “There is always a niche for the hands-on approach, so we can change to meet consumer needs, whereas chain stores have to to through longer processes.”
Moving forward, Gene’s is in the midst of building a brand new Web site through its certified ad group. It will be primarily an informational piece, talking about the stores and departments, available products, and providing phone numbers for orders. For now, the company has no plans to expand to new locations and is concentrating on its current markets.
“We do have good locations in upper scale areas, but everyone is watching dollars, and we are mindful of that,” said Smejdir. “We are watching our labor percentages and making sure we are bringing in items that are the best sellers the customers want while continuing to carry the variety that makes us stand out.”
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