pseudo3d wrote: ↑December 3rd, 2020, 9:20 am
Yeah, they tried that, it was called Walmart Express. It was a big failure, and before all of them got killed, they became Neighborhood Markets (though the Express name stayed on the stores if I recall).
The more likely future is converting some of them to dark stores/merchandise pickup stores and closing/selling the rest.
Don't forget the other small 14k square foot "Marketside" format from Arizona 20 years ago which was basically a grocery and fresh food focused version of this...
I went into two of these Express Stores, one of the initial ones then later one of the ones that was part of the larger roll out they did.
First, structurally, they were basically a Fresh & Easy Store in terms of size and layout of most of the departments. However, they squeezed in a pharmacy. They also squeezed in an aisle or two of non food with a very abbreviated mix of basic items like towels, pillows, some very basic hardware, etc. They had a large SKU mix in the store, they seemed to try to pack as many SKUs as they could into a small space. I don't know how they got full cases of various grocery items onto the shelves as most items did not have enough shelf space allocated to stock a full case. One or both of them had gas pumps out front.
Both stores I went into, had at least 5-10 employees on duty when I was there. Employees almost outnumbered customers. Pricing was the same as a large format Wal Mart on everything.
Where I am going here is I don't think these stores were a failure in the sense that they were bad for the customer. The stores were actually very good for the customer. The problem, both with Express and with Marketside, was Wal Mart was trying to do too many things, with a format that required too much labor to work profitably without running significantly higher sales volume than they were running in the stores. Wal Mart, like Fresh & Easy, developed volume expectations that were flat out unrealistic for these small boxes. Yes small box Trader Joe's is very effective in sales per square feet but a lot of the other small boxes (like the drugstores) are quite low volume operations.
Dollar General has this format tuned in and how to do it profitably. Cheap pre-fab buildings. Rarely more than 2 employees on duty. Minimal to no maintenance. No fancy things like in-store music networks (maybe they pipe in a local radio station if you're lucky). Good SKU mix and aggressive pricing. Easy to use coupon app. Despite messy stores that seem poorly stocked, they were a store that had things like hand sanitizer and paper products available (at low prices) when others did not during the pandemic. They can survive on low volumes because they cut their expenses to the bone (past the bone, as I see it) but they are there to serve the customer with basic products at fair prices and they do that well.