Grocers prepare for Wal-Mart
By Don Shilling
Grocery store owners say they can compete with the new Wal-Mart Supercenter.
AUSTINTOWN — It’s hard to miss the Wal-Mart expansion. The Mahoning Avenue store is now a Supercenter, with 61,000 additional square feet for a full line of groceries. It’s so big that the store has hired nearly 200 more employees.
You can bet that other grocery store owners have noticed.
“It’s going to be fun,” said Michael Rulli with a laugh.
Rulli, whose family owns Rulli Bros. stores in Austintown and Boardman, said he is welcoming the challenge of competing with Wal-Mart on groceries but quickly added that he has no choice. Wal-Mart has grown to be the nation’s largest retailer with a focus on driving down costs by tightly controlling inventory.
“Hopefully, they’ll make me a better operator,” Rulli said. “I’ll have to be sharper on price and sharper on buying.”
He’s confident, however, that his store’s prices are low enough to compete with Wal-Mart. He pointed to a 2003 survey done by The Vindicator that compared prices of nine household staples at six area stores. Rulli Bros. finished second, with its total cost being just 39 cents behind the Wal-Mart Supercenter in New Castle, Pa.
“I really don’t think Wal-Mart will have a huge impact on us,” Rulli said.
He said the family’s stores will continue to focus on customer service and keeping costs down by maintaining low overhead. Six family members pitch in when extra work needs to be done. Inventories are kept low, and perishable items are priced so that they sell quickly and don’t go bad, he said.
Rulli, a Columbiana resident, said he watched closely when Wal-Mart opened a Supercenter in Salem. Some people in the local grocery industry thought the existing stores would have trouble competing, but now all of the stores appear to be thriving, Rulli said. He thinks the Supercenter is drawing in more customers from outlying areas, so all the stores are benefiting.
The Austintown Supercenter may bring in more shoppers from North Jackson and Ellsworth, who might also stop at Rulli Bros., he said.
The store can attract such customers because it has a niche of offering specialty Italian products, including meats, pasta and oil, he said.
Henry Nemenz, a local grocer who owns an IGA store in Canfield and a Save-A-Lot store in Austintown, said he thinks his stores are positioned well to survive in the face of increased competition.
The Save-A-Lot chain bills itself as a low-cost option, featuring store brands that are sold in smaller stores. Nemenz said he’s exploring ways of improving service at the store but didn’t want to be specific.
Nemenz said he has been upgrading his Canfield store to stay competitive. The store has expanded its hot food and meat sections and is installing new freezers this month.
Though Nemenz is optimistic about the new competition, he added that all local retailers know the power that Wal-Mart has because of its size.