Again, the Waco stores are going to be different than the Dallas stores, and legacy stores/markets are different animals than newer ones. In Waco, Albertsons never gained much ground, Kroger was never an issue, and Winn-Dixie operated about three or four stores in the area before disappearing when the Texas division was closed. They can get away with planting blue-collar H-E-B stores in Waco. They probably won't be able to do the same in Dallas.SoleOwnerOfMyName wrote: ↑January 19th, 2023, 9:34 pmBut does HEB build anything but large stores in urban areas these days? The only smaller HEB stores I have seen in urban areas have been older locations which, I understand, typically get expanded or relocated whenever it is feasible for them to do so.pseudo3d wrote: ↑January 19th, 2023, 7:42 pm The real challenge will be if H-E-B has a less-than-high-end store that is closer to WinCo's consumer and product mix. As for Walmart, H-E-B definitely stifled the growth of Wal-Mart Neighborhood Market in Houston (only a handful of stores opened and even less are open today) with their Pantry stores but things aren't what they were in the early 1990s, and part of the problem is that H-E-B's reputation is now a liability, where they've got such a good reputation in some parts that anything less than a large, high-end store like what they're doing in Frisco (or their single Lubbock) will end up damaging their reputation and hurting enthusiasm for future stores.
I was recently in one of the Waco HEB stores - a city where all of the HEBs are large. Waco is hardly a high-end city and the part of town this particular HEB was located in is hardly high-end.
The Federal Reserve website, of all places, recently had an interview with HEB's president.
https://www.dallasfed.org/research/swe/ ... 4/swe2204d
It has a passage that I think provides important context about HEB's approach:
"The average grocery company usually chooses to serve a [particular] customer segment. So, we know where Whole Foods is going to be, and which customers and which neighborhoods they’re going to serve. We know where the Dollar stores are going to be, where Trader Joe’s is going to be.
We’ve chosen to serve a state rather than a segment of customers; we are trying to serve everybody in areas of Texas (and Mexico). In our markets, that means being successful by reaching every different income level and demographic.
We do that by tailoring our stores, trying to have each store be the best store for a neighborhood with the items that the neighborhood will like most. We also believe we should be multiformat, meaning that in Dallas we have Central Market—and now H-E-B—or in Houston we have Mi Tienda and Joe V’s.
Many strategists will say you’re either low price or you’re differentiated. Whole Foods has high service and quality, but they’re also high priced. That’s the trade-off people often think of—cost or quality. The Dollar stores are theoretically lower price—although they’re not that low—and the quality is not quite as good. Many people think that’s the normal trade-off."
There are two different issues at play here, the main topic: Will Tom Thumb being able to survive in Waxahachie, and the off-topic, will H-E-B dominate Dallas? The first issue seems more on the management of Albertsons than anything (not confident with that) but the second issue is an entirely different beast. Plus, Albertsons and H-E-B co-exist in Cleburne, how would you explain that?