Top Foods being phased out in favor of Haggen

[Super S]

Those pictures show the time warp well. That interior as well as the outside sign are EXACTLY what the Kelso store had when it opened around 1989-90. One change I noted from my visit though is that they have replaced the mercury vapor light fixtures with fluorescent fixtures. I gotta agree though it looks pretty bad in those pictures.

[marshd1000]

Here's an interesting article from today's Seattle Times about the Top to Haggen transformation: http://seattletimes.nwsource.com/html/b ... gen27.html

[Super S]

I find it interesting that a small chain plans on increasing private-label sales. I know Haggen carries some private labels, but it seems like they would not have much influence or control on the quality of some products unless they have ownership in at least some of the places they come from as the larger chains like Kroger do.

[Alpha8472]

Haggen is a member of TopCo. TopCo is a cooperative where all the members own the company.

TopCo products are made by various companies such as RalCorp/Ralston Foods. RalCorp makes the generic store products for Kroger, Safeway, and other stores. The products simply have a different brand name put on the box.

People rattle on and on about how wonderful Kroger and Safeway products are, when in fact RalCorp is the one making the food products and they use the same products for other supermarkets as well.

Generic food products can be quite good and sometimes are even better than the brand name products. Private label products cost less and are more profitable for supermarket chains.

[Super S]

I was not aware of TopCo. I knew that canned goods sometimes came from the same places as the name brands, but thought Kroger owned a facility where some canning took place. I agree that store brands are good, I myself actually prefer some of them over the name brands.

But still...Haggen is a pretty small influence when you have large chains such as Kroger and Safeway as your customers. One of the large chains could demand that a product be made differently or lose them as a customer, and the way the large chain wants it may not necessarily be what the customers of the small chain want. A large chain could also have a product made a certain way exclusively for sale by said chain and nobody else, which may not be feasible for a small chain due to a smaller overall sales volume.

[Brian Lutz]

Kroger has a whole subsidiary company (Inter-American Products) that produces Kroger store brand products, which is actually quite extensive (currently they run 36 manufacturing facilities all over the country) and is in charge of all their dairy and bakery facilities as well. As far as I can tell they aren't exclusive to Kroger though, and produce other store's house brand products as well.

I know Safeway also produces a lot of their own house brand products as well. There are fairly extensive Safeway manufacturing operations (bakery, bottling and dairy plants) right here in Bellevue.

[Alpha8472]

Cott Beverages is one of the biggest private label soda bottling companies. They make the private label sodas for places such as 7-Eleven, Save-A-Lot, HEB, and Food Lion. They also bottle sodas and drinks for supermarket chains all over the world including J. Sainsbury, the largest grocery chain in the United Kingdom. Cott started making Albertson's store brand soda in 1995.

Soda brands: Stars & Stripes, Vess, Vintage, So Clear, Shanstar, Harvest Classic, Chadwick Bay, and Golden Crown in the U.S. It primarily serves grocery, mass-merchandise, drugstore, wholesale, and convenience store chains.

They used to make the sodas for Walmart for years. They stopped making sodas for Walmart only about 2 years ago.

Walmart found out that Cott had been giving Safeway a cheaper price for their sodas, so Walmart terminated their contract with Cott. Cott's stock price tumbled. Cott became the world's biggest maker of store-brand soft drinks largely by supplying Wal-Mart Stores Inc. This included Sam's Club. Sam's American choice accounted for 40% of Cott's sales several years ago.

Losing Walmart as a customer almost destroyed the company, but Cott has managed to survive because they supply many other supermarket chains around the world.

Cott also bottles RC Cola. Cott used to bottle the Safeway Select brand sodas. However, the Safeway select brand was phased out a couple of years ago.

Cott Corporation was asked by Safeway Supermarkets for help in marketing its store-brand line of soda around 1994. Cott saw that Safeway needed to do more than simply revive sluggish cola sales. It needed
to improve the performance of all its private-label products.

Cott suggested alternative approaches to package design, merchandising, promotion, and production formulation. Cott also enlisted the help of the people who could be the most effective in selling the cola: Safeway employees. Cott reminded them that private-label soda helps preserve Safeway's profit margins - and their jobs.

In effect, Cott created 76,000 new sales people for Safeway Select Soda and achieved a stuffing 35 percent market share within four months of introduction.

[storewanderer]

Well, I was in Bellevue today and stopped by this store. I am quite a fan of Haggen, but...

I wasn't too impressed. It still didn't seem as good as the actual Haggen Stores. There was no salad bar and the prepared foods areas did not seem to have the variety or neat, nice presentation of the normal Haggens. The presentation was kind of messy and did not flow.

In fact, the entire place did not flow very well. For example the bulk foods, they had some random grains and such in the back of the store between meat and bakery, then had a bunch of bulk candy in the front of the store in what is a visible space and I don't think bulk candy in that space is the highest and best sales/profit potential use of that space... I'm sure they increased bulk candy sales giving it that space, but at what cost?

Then there was the bakery. I don't get it. Haggen has an excellent, excellent bread program with Bellterra or whatever they call it. Well, they eliminated that branding from this store and while they still have some of the bread items associated with it, not all of them were there. The breads were oddly presented; some in buckets, some in normal bins, just odd. Then there was a display in the front of the store with bread from some other source (not in-store baked).

The center store seemed good. It was well stocked and the pricing looked good (lower than QFC, Safeway, or Albertsons if only slightly).

The produce area looked nice, but was extremely high priced. The same goes for meat.

The new decorations just look kind of cheap and like they won't age well. The entire thing seemed very downscale compared to the actual Haggen Stores up north of Seattle or in Portland.

Haggen, specifically the Top Food operation, needs a shot of life. I don't think this type of remodel is the answer. Rebranding to Haggen is the right idea, but they need to make it more upscale and get something that flows better. Highlight what Haggen is best at: high quality perimeter products. A cheap looking store starts to call the quality of the products into question and that is what this store does in my mind. That is why the Top Stores are not doing well; they sell top quality items but the stores look tired and somewhat run down.


The Top in Olympia looks MUCH better than this store... if they are going to renovate stores, they should use that model.

[Super S]

So...here it is nearly a year later, and from what I can tell, no more TOP stores have been converted. One in Lacey has closed. Has Haggen abandoned the idea? Makes me wonder if more store closings are in the works. It doesn't help that WinCo is increasing its presence, and Walmart is rolling out its "Neighborhood Market" format. Haggen needs to figure out what they plan to do, and they need to figure it out quickly. I am beginning to think Haggen as a whole is going to slowly fade away as it seems they have lost their focus.

[storewanderer]

Haggen is busy with things. They are closing or maybe have already closed the Federal Way Top. This should be no surprise as there is a Wal Mart Supercenter basically adjacent. I thought I had photos of that Top, but it does not look like I do. I was in there quite a few times and customer count was very very low.

I think it is too late for Haggen. I predict they are going to end up a very, very small chain. But I give them credit for trying to run things like a legitimate chain despite their situation. Still running a warehouse, still trying to have their own private label program, still maintaining high quality fresh products.

I am also guessing the investment group is not wanting to throw more cash into this as the return on investment is not satisfactory.

I do not mean to be negative or critical. I really like Haggen; if I lived in their operating regions, I would do a significant portion of my shopping in their stores, especially for produce, prepared food, and bakery.