Raleys converting Reno Store to ONE Market Format

[ClownLoach]

Sounds like it's going to be watered down just like the meaningless Fresh Fare moniker at Ralphs. About a net 5% SKU mix difference, maybe a few specialty produce/meat/seafood items, and different wall decor. They changed the sign to green, right? My guess is they'll change the sign back to red, and then at some point later the "One" letters will be unceremoniously removed overnight just like we are seeing Ralphs remove Fresh Fare letters now.

At this point it is worse than a normal Raleys. They took away the nutritionist kiosk/ "Education" part of O-N-E. Sure they have Organics but Raleys has always had a heavy assortment of Organic products, they were the first major chain to start slotting in Organic produce out west back in the mid 90's and had Nutrition departments in their stores going back to the late 70's era "Superstore" format which none of the competitors in NorCal had.

Where this store lacks is since it still does not have the full assortment of typical products like a normal Raleys, they also don't put as much meat, bakery, deli, or produce out as the store did before so it is lacking in those areas too. Multiple bakery/deli items I have asked them for and get told "we don't carry that in this store anymore" or "we don't carry that in the ONE Stores" or similar. A few instances, the items I ask about seem to show up a couple weeks after I have a talk with store management about the missing items which I find interesting; they make no promise they will bring the item back but it seems to show back up, maybe just a coincidence.

At least as of last summer the 4 "ONE" Stores were in a separate district with a separate district manager from the other stores. Not sure if that changed.

At some point the cost of maintaining a separate prototype for only 4 stores will torpedo it. A time will come where they need to cut costs and all the excess overhead will finish off "ONE". Especially if they can take a fat write-off for all the money they sank into the dud format. I'm not sure how long before you can take such a loss (in the form of a "goodwill write-off" etc.) but it would benefit them in either a bad year or a really good year as either way they'd net a big savings on their corporate taxes.

[storewanderer]

At some point the cost of maintaining a separate prototype for only 4 stores will torpedo it. A time will come where they need to cut costs and all the excess overhead will finish off "ONE". Especially if they can take a fat write-off for all the money they sank into the dud format. I'm not sure how long before you can take such a loss (in the form of a "goodwill write-off" etc.) but it would benefit them in either a bad year or a really good year as either way they'd net a big savings on their corporate taxes.

I think the format may sort of work in Truckee. The problem is they blew so much money building Truckee (the ceiling alone cost millions) that I am not sure how it can ever be very profitable of a store. Since it is only 35k-39k square feet they had to abbreviate the product mix there and ONE was their solution.

Truckee is the only one currently operating under the banned ingredients list/no Coke etc.

I am kind of afraid they may keep the format going longer than they should. There is a real pride thing going on with them when it comes to Raleys ONE. What bugs me is I think they could have made the format work if they had approached it differently. But their approach to take all the shortcuts of a typical chain grocer (wanting long shelf life on bakery/deli stuff industry standard type of mentality instead of preparing stuff in store with simple ingredients that would have a short shelf life, for example; just flat cutting items out that needed to be stocked and if they couldn't find a suitable brand they needed to develop the item on their own for private label like Trader Joe's does) and try to squeeze them into a banned ingredients list format and it did not fit.

[ClownLoach]

At some point the cost of maintaining a separate prototype for only 4 stores will torpedo it. A time will come where they need to cut costs and all the excess overhead will finish off "ONE". Especially if they can take a fat write-off for all the money they sank into the dud format. I'm not sure how long before you can take such a loss (in the form of a "goodwill write-off" etc.) but it would benefit them in either a bad year or a really good year as either way they'd net a big savings on their corporate taxes.

I think the format may sort of work in Truckee. The problem is they blew so much money building Truckee (the ceiling alone cost millions) that I am not sure how it can ever be very profitable of a store. Since it is only 35k-39k square feet they had to abbreviate the product mix there and ONE was their solution.

Truckee is the only one currently operating under the banned ingredients list/no Coke etc.

I am kind of afraid they may keep the format going longer than they should. There is a real pride thing going on with them when it comes to Raleys ONE. What bugs me is I think they could have made the format work if they had approached it differently. But their approach to take all the shortcuts of a typical chain grocer (wanting long shelf life on bakery/deli stuff industry standard type of mentality instead of preparing stuff in store with simple ingredients that would have a short shelf life, for example; just flat cutting items out that needed to be stocked and if they couldn't find a suitable brand they needed to develop the item on their own for private label like Trader Joe's does) and try to squeeze them into a banned ingredients list format and it did not fit.

Problem is they're basically operating a larger, higher overhead Sprouts at that point without additional merchandise to support it. I don't think there is a single conventional SKU left at Sprouts after shopping in detail yesterday, maybe some absolute staples like butter, Tillamook ice cream, and some Taylor Farms salads. Another entire island of produce has moved to organic, which meant a thinned out presentation as they don't have the inventory to support the space (and this was in the "good" location I like). Pretty much everything else is only specialized brands and nearly every price tag has some kind of flap on it calling out the item as vegan, keto, non-dairy, vegetarian, and so on till you can't even see the items themselves on the shelf. Also switching to a lot of store brand... Saw most of the expensive Alexia frozen natural French fries and such were just replaced with a Sprouts brand with very similar looking packaging. With the sky high prices these specialty items command, like a small salt shaker priced at $6.99 instead of a $1 Morton Salt canister, you can see why they create the illusion of improving sales and profits to Wall Street despite the fact they've probably lost over 75% of their transactions. They have spread out new Sprouts brand "all natural" deli meats and cheeses, and piled up all the Boars Head in an unattractive manner. The second they pull Boars Head will be the last time I walk through their doors

I know that seemed off topic, but it shows the same problem ONE faces... When you choose to limit the assortment, the removal of even one item can result in lost business.

[storewanderer]

Problem is they're basically operating a larger, higher overhead Sprouts at that point without additional merchandise to support it. I don't think there is a single conventional SKU left at Sprouts after shopping in detail yesterday, maybe some absolute staples like butter, Tillamook ice cream, and some Taylor Farms salads. Another entire island of produce has moved to organic, which meant a thinned out presentation as they don't have the inventory to support the space (and this was in the "good" location I like). Pretty much everything else is only specialized brands and nearly every price tag has some kind of flap on it calling out the item as vegan, keto, non-dairy, vegetarian, and so on till you can't even see the items themselves on the shelf. Also switching to a lot of store brand... Saw most of the expensive Alexia frozen natural French fries and such were just replaced with a Sprouts brand with very similar looking packaging. With the sky high prices these specialty items command, like a small salt shaker priced at $6.99 instead of a $1 Morton Salt canister, you can see why they create the illusion of improving sales and profits to Wall Street despite the fact they've probably lost over 75% of their transactions. They have spread out new Sprouts brand "all natural" deli meats and cheeses, and piled up all the Boars Head in an unattractive manner. The second they pull Boars Head will be the last time I walk through their doors

I know that seemed off topic, but it shows the same problem ONE faces... When you choose to limit the assortment, the removal of even one item can result in lost business.

They have done multiple phases adding back in certain conventional SKUs in the Reno ONE. It started by adding items back but putting them on the bottom shelves. Then they did another phase where it was the bottom two shelves. Reduced flavors/varieties from a typical Raleys but still an improvement from not having these items at all and having "where's my yogurt?" or "where's my frozen meal" signs up suggesting you ask an employee to help you find an "alternate" product that will fit your needs.

Now in the current reset the bottom shelf thing is done and they are moving conventional products back to eye level, top, bottom, etc. looking more like a standard set again.

But your experience with Sprouts is the exact experience people had with the Reno ONE in May 2021 when it converted from a normal Raleys. Normal branded items were gone. The items there were unfamiliar and very high priced. They kept a good number of Raleys brand canned items around but this store catered to high income customers. It was previously merchandised as a "Premium" Raleys. They seem to have confusion over the high income customer who wanted "premium" merchandise but wasn't necessarily interested in weird "Organic" items they had never seen or heard of before. In the case of Sprouts I am not really sure what the picky eater customer Sprouts seems to be trying to cater to wants. I think the picky eater customer may feel special and feel good about paying 6.99 for a thing of salt with some fancy label and they may be thinking those Sprouts fries are just as good as Alexia since the package looks the same and feel great paying that price and maybe that is what Sprouts is going for. I think the Sprouts customer may be more flexible/open to trying odd/vague products. Raleys ONE didn't make anyone feel good about anything, it just pissed everyone off; the high income customer many of which 50-60+ age group knew what they wanted and didn't want Raleys ONE to tell them otherwise.

[veteran+]

At some point the cost of maintaining a separate prototype for only 4 stores will torpedo it. A time will come where they need to cut costs and all the excess overhead will finish off "ONE". Especially if they can take a fat write-off for all the money they sank into the dud format. I'm not sure how long before you can take such a loss (in the form of a "goodwill write-off" etc.) but it would benefit them in either a bad year or a really good year as either way they'd net a big savings on their corporate taxes.

I think the format may sort of work in Truckee. The problem is they blew so much money building Truckee (the ceiling alone cost millions) that I am not sure how it can ever be very profitable of a store. Since it is only 35k-39k square feet they had to abbreviate the product mix there and ONE was their solution.

Truckee is the only one currently operating under the banned ingredients list/no Coke etc.

I am kind of afraid they may keep the format going longer than they should. There is a real pride thing going on with them when it comes to Raleys ONE. What bugs me is I think they could have made the format work if they had approached it differently. But their approach to take all the shortcuts of a typical chain grocer (wanting long shelf life on bakery/deli stuff industry standard type of mentality instead of preparing stuff in store with simple ingredients that would have a short shelf life, for example; just flat cutting items out that needed to be stocked and if they couldn't find a suitable brand they needed to develop the item on their own for private label like Trader Joe's does) and try to squeeze them into a banned ingredients list format and it did not fit.

Problem is they're basically operating a larger, higher overhead Sprouts at that point without additional merchandise to support it. I don't think there is a single conventional SKU left at Sprouts after shopping in detail yesterday, maybe some absolute staples like butter, Tillamook ice cream, and some Taylor Farms salads. Another entire island of produce has moved to organic, which meant a thinned out presentation as they don't have the inventory to support the space (and this was in the "good" location I like). Pretty much everything else is only specialized brands and nearly every price tag has some kind of flap on it calling out the item as vegan, keto, non-dairy, vegetarian, and so on till you can't even see the items themselves on the shelf. Also switching to a lot of store brand... Saw most of the expensive Alexia frozen natural French fries and such were just replaced with a Sprouts brand with very similar looking packaging. With the sky high prices these specialty items command, like a small salt shaker priced at $6.99 instead of a $1 Morton Salt canister, you can see why they create the illusion of improving sales and profits to Wall Street despite the fact they've probably lost over 75% of their transactions. They have spread out new Sprouts brand "all natural" deli meats and cheeses, and piled up all the Boars Head in an unattractive manner. The second they pull Boars Head will be the last time I walk through their doors

I know that seemed off topic, but it shows the same problem ONE faces... When you choose to limit the assortment, the removal of even one item can result in lost business.

My experiences with Sprouts have been the same.

I am a picky shopper and when available I purchase only Organic. Many times I will not buy something because there is no Organic version of it.

Premimum prices within reason are tolerable for me BUT Sprouts is way over priced and variety sucks (more shopping trips at other stores) and their quality is not great and their customer service is a joke.

And...........................I'm not gonna bag my groceries with those PRICES............nope nope nope!