The present and future of Randalls

[architect]

A tale of four Austin Randalls stores:

Over this weekend, I was able to visit four Randalls locations in Austin, all with widely varying experiences. I will summarize my thoughts below (I apologize for the lack of photos):

Store 1: On Saturday afternoon, I visited the location at 183 (Research Blvd) and Braker Ln. in North Austin (a Randalls "New Generation" store). Having visited this location previously prior to the Albertsons buyout, the first thing I noticed was revamped lighting around the store's perimeter. Like the DFW Tom Thumbs with warehouse ceilings, this store received hanging fluorescent fixtures which really helped to lighten up the store (although the fixtures themselves were slightly different). The bakery was extremely well stocked, and I even saw the store's pizza oven being actively used. Produce looked fresh and clean. Honestly, I can say that this is one of the best former Safeway-operated stores I have seen in Texas. The store seemed to have a good amount of traffic, and seemed to be staffed adequately (which seems to be a common shortfall present-day Albertsons).

Store 2: On both Saturday night and Sunday morning, I visited the location in West Lake Hills (a former Safeway turned Appletree turned Randalls). On both visits, traffic was noticeably slow, especially on Sunday morning (at the nearby HEB, both the parking lot and store were packed, while this Randalls maybe had 10 shoppers total). The store seemed clean and well-stocked, but was definitely in need of an upgrade (the store features the original version of the Lifestyle decor and is extremely dark in the bakery/deli/produce areas). The aisles also seemed tightly spaced, likely due to the fact that the store is smaller by todays standards, especially in Texas. I was expecting this store to much more trafficked simply due its location alone (an extremely wealthy area of Austin), but it seems like the combination of HEB and a nearby Trader Joe's are killing this one.

Store 3: On Sunday morning, I visited the store at MoPac and William Cannon (a Randalls-built location from the early-mid 90's). Like the Braker Lane store, this location featured a warehouse ceiling throughout with recently replaced lighting. However, the store's traffic seemed significantly lower (especially compared to a nearby HEB less than a mile to the east) and the facilities were in clear need of maintenance (a decorative trellis at the store's entrance was badly peeling paint, trash was strewn around the exterior, and numerous aisle markers were falling apart on the interior (dating from the early Lifestyle era, despite the store being 2nd generation Lifestyle). This is another store which I was underwhelmed by, especially considering its prime location.

Store 4: My last stop was the store at 5311 Balcones (another former Safeway turned Appletree turned Randalls). Unlike the West Lake Hills store, this location was significantly smaller (like most of the former Appletree/now Randalls locations around Austin) and was honestly in dire condition. When I first entered the store, the first thing I noticed was a dreaded "fishy" smell that became progressively worse towards the back of the store. In addition, no lighting "upgrades" had taken place yet, and at least 30-40% of the recessed cans around the perimeter departments were burned out, making the store significantly darker than even your typical Lifestyle store (to the point of being borderline unsafe). The floral department was especially dark, with both the Lifestyle signage ("Poetry in Bloom") and several overhead lights being burned out, making it nearly impossible to see the floral arrangements on display. The store's product selection was also simply too small to be effective, even for convenience runs. Overall, these small stores pose a unique challenge for Albertsons, as many of them are in dire need of investment, while also forming the majority of Randalls inner-city store base in Austin.

Overall, I feel that Albertsons could turn around the Austin-area Randalls operations. However, in order to do so, they really need to look at ways to upgrade the older Appletree locations, and in some cases, consolidate these stores into larger facilities where possible. These smaller stores are simply holding back the chain's image, especially with HEB gradually upgrading/expanding the majority of their Austin stores. It will be interesting to see how this whole scenario plays out.

[pseudo3d]

To Randalls credit in Austin, they actually did build a few *new* stores in the last five years (one is currently under construction). However, these tend to be smaller than H-E-B. I wonder if Albertsons LLC held onto a few store sites that could still be viable. They did hold onto the one in Waco and are leasing it to Harmony Science Academy, but I bet the ones that could be used as grocery were sold to H-E-B.

As for your four Randalls in Austin, I'm not sure which store the "West Lake Hills" store is. The one at Bee Caves and Walsh Carlton looks like it may have been a Tom Thumb (at the same time they bought AppleTree, they rebranded the Tom Thumb stores there). Exposition and Lake Austin was a former Safeway though. MoPac/William Cannon opened in 1995...you can see under construction in the 1/95 Google Earth shot. 5311 Balcones received an expansion at one point, though I can't tell from the aerial if it was a from-the-ground-up expansion or an expansion into another storefront (at least three Safeway stores in the Houston division were built with Eckerd stores right next to them). Either way, it's still pretty small.

Also note that there are no Randalls stores at all east of I-35. Yeah, I know it's a poorer area, but it does really highlight how their market is a pretty distant number two as far as traditional grocers are concerned.

[storewanderer]

For some reason I thought they had a good store base in Austin. I think it was because Safeway was developing new stores there and also because I assumed since they were the last chain standing against HEB they must be doing something right. I also thought their marketing strategies and California type attitude may play well in Austin.

How would their quality compare to HEB? I am trying to determine why anyone would shop them over HEB? Obviously their prices are higher... but if quality or atmosphere are better? Faster to get in and out of the store?

[architect]

To Randalls credit in Austin, they actually did build a few *new* stores in the last five years (one is currently under construction). However, these tend to be smaller than H-E-B. I wonder if Albertsons LLC held onto a few store sites that could still be viable. They did hold onto the one in Waco and are leasing it to Harmony Science Academy, but I bet the ones that could be used as grocery were sold to H-E-B.

As for your four Randalls in Austin, I'm not sure which store the "West Lake Hills" store is. The one at Bee Caves and Walsh Carlton looks like it may have been a Tom Thumb (at the same time they bought AppleTree, they rebranded the Tom Thumb stores there). Exposition and Lake Austin was a former Safeway though. MoPac/William Cannon opened in 1995...you can see under construction in the 1/95 Google Earth shot. 5311 Balcones received an expansion at one point, though I can't tell from the aerial if it was a from-the-ground-up expansion or an expansion into another storefront (at least three Safeway stores in the Houston division were built with Eckerd stores right next to them). Either way, it's still pretty small.

Also note that there are no Randalls stores at all east of I-35. Yeah, I know it's a poorer area, but it does really highlight how their market is a pretty distant number two as far as traditional grocers are concerned.

For some reason I thought they had a good store base in Austin. I think it was because Safeway was developing new stores there and also because I assumed since they were the last chain standing against HEB they must be doing something right. I also thought their marketing strategies and California type attitude may play well in Austin.

How would their quality compare to HEB? I am trying to determine why anyone would shop them over HEB? Obviously their prices are higher... but if quality or atmosphere are better? Faster to get in and out of the store?

Under Safeway's leadership, the former Appletree locations in Austin were actually maintained relatively well, and became known as great stores for "milk and eggs" runs when residents did not want to have to battle the traffic and crowds typical of most HEB's. However, since Albertsons took over, these stores have not been managed well, and are really beginning to show a lack of investment, both in decor and basic maintenance. Surprisingly, on my recent visit, pricing was much more competitive than I remember under Safeway, and not too much higher than HEB. Overall, there are several strong Randalls locations in the Austin area (mainly built under Randalls or Safeway's leadership, plus a few others), but their inner-city store base is simply undersized and outdated. Dense locations like the Houston Midtown Randalls may be the answer to this quandry.

From the front, I cannot tell if the Bee Caves store (this is the West Lake Hills store btw) is a former Appletree or a former Tom Thumb. The store's layout seems more reminiscent of an 80's-early 90's Tom Thumb, but the store features green awnings similar to those seen on the former Safeway/turned Appletree/turned Village Foods in Bryan or the former Safeway/turned Appletree/turned Kroger at the Villages in Houston.

Also, technically there is one store east of I-35, but up in Round Rock (if that counts).

Just as an idea, could Austin be a potential candidate for a Safeway rebranding, especially if the Florida experiment goes well? Austin has a huge amount of West Coast transplants, and by rebranding the stores, Albertsons could rebuild their image and hopefully rebuild market share against HEB.

[wnetmacman]

Just as an idea, could Austin be a potential candidate for a Safeway rebranding, especially if the Florida experiment goes well?

Based largely off the year 1987, there is still too much bad blood for the Safeway name in Texas. I don't think it would do well, even though most folks know that Randalls is a Safeway-owned store.

[pseudo3d]

To Randalls credit in Austin, they actually did build a few *new* stores in the last five years (one is currently under construction). However, these tend to be smaller than H-E-B. I wonder if Albertsons LLC held onto a few store sites that could still be viable. They did hold onto the one in Waco and are leasing it to Harmony Science Academy, but I bet the ones that could be used as grocery were sold to H-E-B.

As for your four Randalls in Austin, I'm not sure which store the "West Lake Hills" store is. The one at Bee Caves and Walsh Carlton looks like it may have been a Tom Thumb (at the same time they bought AppleTree, they rebranded the Tom Thumb stores there). Exposition and Lake Austin was a former Safeway though. MoPac/William Cannon opened in 1995...you can see under construction in the 1/95 Google Earth shot. 5311 Balcones received an expansion at one point, though I can't tell from the aerial if it was a from-the-ground-up expansion or an expansion into another storefront (at least three Safeway stores in the Houston division were built with Eckerd stores right next to them). Either way, it's still pretty small.

Also note that there are no Randalls stores at all east of I-35. Yeah, I know it's a poorer area, but it does really highlight how their market is a pretty distant number two as far as traditional grocers are concerned.

For some reason I thought they had a good store base in Austin. I think it was because Safeway was developing new stores there and also because I assumed since they were the last chain standing against HEB they must be doing something right. I also thought their marketing strategies and California type attitude may play well in Austin.

How would their quality compare to HEB? I am trying to determine why anyone would shop them over HEB? Obviously their prices are higher... but if quality or atmosphere are better? Faster to get in and out of the store?

Under Safeway's leadership, the former Appletree locations in Austin were actually maintained relatively well, and became known as great stores for "milk and eggs" runs when residents did not want to have to battle the traffic and crowds typical of most HEB's. However, since Albertsons took over, these stores have not been managed well, and are really beginning to show a lack of investment, both in decor and basic maintenance. Surprisingly, on my recent visit, pricing was much more competitive than I remember under Safeway, and not too much higher than HEB. Overall, there are several strong Randalls locations in the Austin area (mainly built under Randalls or Safeway's leadership, plus a few others), but their inner-city store base is simply undersized and outdated. Dense locations like the Houston Midtown Randalls may be the answer to this quandry.

From the front, I cannot tell if the Bee Caves store (this is the West Lake Hills store btw) is a former Appletree or a former Tom Thumb. The store's layout seems more reminiscent of an 80's-early 90's Tom Thumb, but the store features green awnings similar to those seen on the former Safeway/turned Appletree/turned Village Foods in Bryan or the former Safeway/turned Appletree/turned Kroger at the Villages in Houston.

Also, technically there is one store east of I-35, but up in Round Rock (if that counts).

Just as an idea, could Austin be a potential candidate for a Safeway rebranding, especially if the Florida experiment goes well? Austin has a huge amount of West Coast transplants, and by rebranding the stores, Albertsons could rebuild their image and hopefully rebuild market share against HEB.

In Texas, the Safeway name is completely burned, probably just as much as Albertsons in NorCal if not moreso. The Bee Cave store I'm not sure what it was...yeah it has the green awnings but nothing's written on it, and it seems to match the existing strip mall more than anything else. I'd be willing to bet the Braker/183 store opened in 1996 to functionally replace the Simon David that closed that year half a mile away (it later became a boutique-sized Saks Fifth Avenue, and is now a Trader Joe's).

EDIT: I vote Tom Thumb because it existed in 1995 and had two entrances at the time.

[architect]

These posts are long delayed, but a couple of months ago, I was in Houston and was able to visit 6 different Randalls locations to get a general grasp on the chain as a whole. I took quite a few photos, so I will be posting a location or two a day.

General observations:

1. The Randalls locations which I visited clearly had more of a Safeway influence than most DFW Tom Thumb locations at this point. Aside from lighting changes and promotional signs hanging everywhere, they felt far less "Albertsons-ized" which in many ways was refreshing.
2. Experiences varied widely across the board, but my overall impression was that even though the chain has some successful locations, they are struggling to rebuild momentum against Kroger and HEB. Customer counts during prime shopping times made this very apparent.

Now for the visits:

The first three stores I visited were the San Felipe/Sage, Westheimer/Shepherd, and Holcombe/Buffalo Speedway locations. I will be combining these stores into one post, as my experiences were somewhat similar between these three locations, and all had similar designs.

All three stores are Randalls Flagship locations dating from the mid-1980's-1990's, with all three featuring Randalls' "tiered ceiling" design which was common across the Flagship-designated stores in this era (a couple of Tom Thumb flagships also feature a similar design). As is becoming the norm with Albertsons, all of the perimeter lighting had been replaced, but with 2x4 flourescent fixtures which were either hanging or in some cases attached directly to the ceiling in the lower tiered areas. Although these fixtures look significantly better than the strip lighting used in other stores, the fixtures in the lower tiered areas could have been easily inserted into the existing drop ceilings for a more cohesive look. Overall though, I was pleased with Albertsons attempt to brighten up these previously dark stores (particularly San Felipe/Sage, which was nearly impossible to see in previously). All three stores did seem somewhat cluttered with promotional signage hanging throughout. However, this signage was at least much less "gimmicky" than the signage used throughout the DFW stores, which feels even more cluttered due to all of the Dallas Cowboys tie-ins.

San Felipe/Sage and Westheimer/Shepherd were both visited late at night, around 9-10 PM. As a result, I was not expecting heavy shopper traffic. While I was one of maybe 4 customers in the San Felipe store, it was clear that this store received at least decent traffic during the day due to the fact that the perishable areas were fairly picked over when I visited. On the other hand, Westheimer/Shepherd was still being heavily shopped, and there were probably at least 20 shoppers I saw during my time there. I know that this store is the golden egg of the Houston division, so this would make sense. Holcombe/Buffalo Speedway was visited on a Sunday morning, and was also well-trafficked. I doubt any of these stores are pulling high-volume HEB sales numbers, but they are definitely still successful and can be profitable if properly managed.

Now here comes the bad part: pricing. Prices were generally set the same as the DFW Tom Thumb stores, which is noticeably high overall compared to both HEB and Kroger throughout the Houston area. On the flipside, there was also little promotional activity compared to DFW, which made the prices seems like even more of a ripoff. The stores also seemed to be understaffed at checkout, particularly at Westheimer/Shepherd where the was only one cashier working. Albertsons just doesn't get it, especially when working with a chain clearly in a rebuilding mode.

Looking for things to get a little more interesting over the next couple of posts. I have a couple of surprises ahead.

Photos:

San Felipe/Sage




Westheimer/Shepherd

[pseudo3d]

1. The Randalls locations which I visited clearly had more of a Safeway influence than most DFW Tom Thumb locations at this point. Aside from lighting changes and promotional signs hanging everywhere, they felt far less "Albertsons-ized" which in many ways was refreshing.

[..]
Now here comes the bad part: pricing. Prices were generally set the same as the DFW Tom Thumb stores, which is noticeably high overall compared to both HEB and Kroger throughout the Houston area. On the flipside, there was also little promotional activity compared to DFW, which made the prices seems like even more of a ripoff. The stores also seemed to be understaffed at checkout, particularly at Westheimer/Shepherd where the was only one cashier working. Albertsons just doesn't get it, especially when working with a chain clearly in a rebuilding mode.

To me, the lack of Albertsons guidance makes Randalls MORE problematic, and from what I've heard has been really hurting the Louisiana Albertsons too, which previously seemed decent and are now part of the division.

[architect]

1. The Randalls locations which I visited clearly had more of a Safeway influence than most DFW Tom Thumb locations at this point. Aside from lighting changes and promotional signs hanging everywhere, they felt far less "Albertsons-ized" which in many ways was refreshing.

[..]
Now here comes the bad part: pricing. Prices were generally set the same as the DFW Tom Thumb stores, which is noticeably high overall compared to both HEB and Kroger throughout the Houston area. On the flipside, there was also little promotional activity compared to DFW, which made the prices seems like even more of a ripoff. The stores also seemed to be understaffed at checkout, particularly at Westheimer/Shepherd where the was only one cashier working. Albertsons just doesn't get it, especially when working with a chain clearly in a rebuilding mode.

To me, the lack of Albertsons guidance makes Randalls MORE problematic, and from what I've heard has been really hurting the Louisiana Albertsons too, which previously seemed decent and are now part of the division.

In many ways, I'm a bit concerned too. Although it has been good to see that Albertsons hasn't completely ruined Randalls image yet by cheapening the stores to an extreme, it also convinces me that they are still unsure on whether to retain, sell or close their Houston stores, considering how eroded their market share is. If Albertsons was to leave Houston, it would be interesting to see what would happen with both the Austin and Louisiana stores. I could see Albertsons retaining Austin simply due to the fact that the stores could be easily integrated into the DFW division and marketed as an HEB alternative. Louisiana would be a bit more questionable for the company to retain, but they have obviously operated stores remotely in the past so it would not surprise me to see them do it again. Both of these areas could also potentially be sold to Kroger.

[pseudo3d]

1. The Randalls locations which I visited clearly had more of a Safeway influence than most DFW Tom Thumb locations at this point. Aside from lighting changes and promotional signs hanging everywhere, they felt far less "Albertsons-ized" which in many ways was refreshing.

[..]
Now here comes the bad part: pricing. Prices were generally set the same as the DFW Tom Thumb stores, which is noticeably high overall compared to both HEB and Kroger throughout the Houston area. On the flipside, there was also little promotional activity compared to DFW, which made the prices seems like even more of a ripoff. The stores also seemed to be understaffed at checkout, particularly at Westheimer/Shepherd where the was only one cashier working. Albertsons just doesn't get it, especially when working with a chain clearly in a rebuilding mode.

To me, the lack of Albertsons guidance makes Randalls MORE problematic, and from what I've heard has been really hurting the Louisiana Albertsons too, which previously seemed decent and are now part of the division.

In many ways, I'm a bit concerned too. Although it has been good to see that Albertsons hasn't completely ruined Randalls image yet by cheapening the stores to an extreme, it also convinces me that they are still unsure on whether to retain, sell or close their Houston stores, considering how eroded their market share is. If Albertsons was to leave Houston, it would be interesting to see what would happen with both the Austin and Louisiana stores. I could see Albertsons retaining Austin simply due to the fact that the stores could be easily integrated into the DFW division and marketed as an HEB alternative. Louisiana would be a bit more questionable for the company to retain, but they have obviously operated stores remotely in the past so it would not surprise me to see them do it again. Both of these areas could also potentially be sold to Kroger.

Louisiana has done well enough that most of it survived LLC (and was renovated). Austin also seems to be on track (a Randalls opened in Leander a few months ago and Georgetown will be groundbreaking this month). The fact that they DID renovate the Midtown store (though it's a rather small store) proves that they may want to hold on. But they also haven't made any motions to build new stores in the suburbs, something Kroger and H-E-B both do. With Boar's Head going into some California stores, it would've been nice to see that in Leander (it was one of the things Old Randalls did) but they didn't. When the got the guy from United to lead the Houston division, I was expecting to see more, but that has yet to come.