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KANSAS CITY, Mo. _ Associated Wholesale Grocers is launching a store concept called ALPS, which stands for always low-price store. The stores are much smaller than most supermarkets and have streamlined selections of top-selling items to speed grocery shopping.
"Today's chain grocery stores have become glitter, glitz and neon," said Len Purvis, president of Associated Wholesale Grocers' new division, LAS Brands Inc. "But people don't eat neon. They want quality food at low prices. Consumers just don't have the time to wander a 100,000-square-foot warehouse to buy groceries."
LAS, which stands for limited assortment stores, is a wholly owned subsidiary of Associated Wholesale Grocers of Kansas City, Kan., and will supply ALPS. The stores will be individually owned but have the same consistent pricing and operations as a chain store.
ALPS opened Thursday in Atchison, Kan.; Fredericktown, Mo.; and El Dorado Springs, Mo.
A store in Omaha, Neb., will open Wednesday. About 30 stores are to open by year's end in 10 states. Some of the stores will be in the Kansas City area. Most will be new store locations, but some will be conversions.
"It costs a lot of money to open a regular supermarket _ $3 million to $4 million, and $10 million for a supercenter. Not a lot of independent operators are able to do that," said Walt Heller, director of research for Progressive Grocer, a New York-based trade publication. "And wholesalers are under pressure. There's a lot of consolidation and continued pressure from Wal-Mart supercenters. The limited-assortment stores are a reasonable way to expand and to fight the chain competition."
Wal-Mart is opening Neighborhood Markets. The 40,000-square-foot stores are smaller than supercenters, enabling customers to get in quickly, select what they need and go. Neighborhood Markets offer more variety than limited-assortment stores, such as ALPS and Aldi stores.
Source: HighBeam Research, Associated Wholesale Grocers launches string of small, streamlined...