« October 2007 Table of Contents
Case Study: Retail revamp for A&P fish
Perishables-focused formats expanding seafood, adding service
By Lisa Duchene
October 01, 2007
When Joe D'Alessandro went to work for The Great Atlantic
& Pacific Tea Co. about 15 months ago, he got right down to
business overhauling the chain's seafood departments. Since
then, the company has audited every seafood product it sells,
changed many suppliers and product specifications, revamped its
shrimp program and upgraded the seafood departments in about 80
of its more than 300 grocery stores.
"We want to re-establish ourselves as the place to buy
seafood in our market areas," says D'Alessandro. "Upscale
grocers, as they move into the trading area, make you better.
You want to be as good as them or better."
D'Alessandro came to A&P from Pathmark Stores, which
operates 141 stores in four Mid-Atlantic states. He is a former
seafood director for Kings, an upscale chain of 26 supermarkets
primarily in New Jersey.
A&P has been busy shedding divisions in order to
concentrate its grocery business in the Northeast. The company
closed its Farmer Jack division in the Midwest, which involved
selling 43 of 66 stores and is negotiating to sell the
remaining 23. A&P's merger with Pathmark is awaiting
Federal Trade Commission approval. A&P also announced it
will exit the Louisiana market and is negotiating the sale of
its Sav-A-Center division there.
In the Northeast, A&P operates about 300 grocery stores
under five banners: Food Emporium (16 gourmet stores in
Manhattan), Food Basics (11 discount stores), A&P (121),
Waldbaum's (70) and Super Fresh (80).
Like many traditional grocers in the last few years,
A&P, headquartered in Montvale, N.J., found itself squeezed
by competition from Wal-Mart and club stores on the low end of
the price scale and by specialty stores like Whole Foods Market
on the high end.
To improve its business, A&P has been working on
upgrading its perishables. In late 2005, A&P began
renovating and upgrading its conventional grocery stores to a
perishables-focused, "Fresh" format, in which it adds the word
"fresh" behind every banner except Super Fresh. There are now
80 fresh-format stores across all the banners.
D'Alessandro initiated product-quality changes throughout
the chain. The 80 fresh-format stores have expanded with more
upscale seafood-product assortments and larger, renovated
seafood departments. In many stores, a four-foot self-serve
seafood section became a 16- or 20-foot service section after
renovation. As a result, seafood sales and profits are
consistently increasing, he says.
The company has done a nice job with its fresh-format
stores, says Neil Stern, a consultant with McMillan Doolittle,
a retail-consulting firm in Chicago. "The issue for A&P is
that while they're in the process of doing that, so is everyone
else in the market," Stern says. "Shop Rite's perishables have
improved and new players like Wegmans and Whole Foods have come
into the Northeast and raised the bar."
Shrimp and fresh fish were the first to receive
D'Alessandro's attention. When A&P's shrimp performed
dismally on quality-assurance tests, D'Alessandro immediately
changed suppliers and shrimp specifications. The new specs for
shrimp sold as A&P's Master's Choice private label calls
for no black spots, no throat meat and a light soak only,
meaning no more than 30 minutes in tri-polyphosphate. Shrimp
sales are trending upward, says D'Alessandro.
The company also changed the vendor and method of supplying
its store with refreshed fillets. A New Bedford, Mass.,
supplier receives whole, frozen fish and slowly thaws them
overnight in a defrosting chamber, then the next day processes
the whole fish into fillets and ships them to the stores, says
D'Alessandro. Every store carries salmon, flounder, tilapia,
cod and catfish. Stores with higher volumes sell a greater
In the fresh-format stores and some of the conventional
supermarkets, D'Alessandro has added upscale items like
all-natural, organically fed Scottish salmon, dry sea scallops,
Arctic char, wild Alaska salmon, sushi-grade yellowfin tuna,
sushi-grade swordfish and cooked and raw organic shrimp.
Auditing and keeping a close watch on suppliers has been a
challenge, says D'Alessandro. But giving seafood that level of
attention is important to the final quality of the product.
"We knew we wanted our customers to see a distinct
difference in what A&P was evolving into and we wanted them
to go into the store and see good, high-quality seafood because
we know that good, high-quality seafood is the way to build a
business," he says.
D'Alessandro is careful to remember value. He tries never to
break a $20 per-pound price point and to deliver the best
possible quality for the price, even at lower price points. He
intends for the prices on even upscale items to be less
expensive than competitors'.
"We want the customer to see a value in what they buy," he
In the value-added arena, A&P has added seasonal
value-added items like ready-to-cook kebobs, salads and stuffed
items. This winter, it will sell stuffed salmon and halibut
roasts that can be sold whole or cut into pinwheels. The
company is adding smoked king, sockeye and coho salmon to its
Master's Choice private label.
"We've sat down with every one of our sushi suppliers, asked
them to come to the table and upgrade their programs," says
D'Alessandro of the in-store sushi shops. "Our sushi sales are
really flying because we introduced bento boxes, and also offer
organic brown rice and vegetarian rolls and vegetarian
D'Alessandro has even become the company's seafood
spokesman, appearing in flyers and recipe cards as "Seafood
Joe." Eager to get consumers' attention and show off the new
seafood assortment, the company has promoted seafood with Road
Shows and truckload sales for most of the year. The road show
is a storewide event promoting a single seafood item like
"colossal king crab" from a Friday to Sunday with banners,
announcements and newspaper advertising. For a truckload sale,
the store sets up a tractor-trailer container in the parking
lot and sells frozen seafood, like 4-pound bags of tilapia, out
of the truck.
"We're using these right now to create excitement, have some
fun and tell people that we're the authority in seafood," says
Contributing Editor Lisa Duchene lives in Bellefonte,