Natural Foods Merchandiser

Supervalu closes Sunflower Markets

Supermarket giant Supervalu Inc. is closing its five Sunflower Market organic and natural food stores.

Eden Prairie, Minn.-based Supervalu said Sunflower Market was an "innovative approach" but that it didn't meet sales goals. "Sunflower Market provided us with a tremendous laboratory for learning about the growing natural and organics market," the company said.

Supervalu plans to close the stores — three in Columbus, Ohio, one in Chicago and one in Indianapolis — Feb. 18.

The company owns the Albertsons, Cub Foods, Lucky, Jewel-Osco, Shaw's/Star Market and Save-A-Lot chains.

When Supervalu opened Sunflower Market in 2006, it announced plans to open 50 more stores in five years. At less than 15,000 square feet per store, the markets were designed to offer what Supervalu called an "efficient convenient shopping experience without compromising on selection." The stores aimed to offer natural and organic produce, meat, fish, dairy and other products at lower prices than their larger natural competitors.

Jim Hertel, managing partner at Barrington, Ill.-based grocery consulting firm Willard Bishop, speculated that the store closings likely were a result of "insufficient sales, a realization that many of the Sunflower concepts could be executed within competitors' traditional supermarkets or an experiment to further their own learning about small format stores and the natural and organic shopper and how they could leverage (that) into their own stores."

Hertel said that experimentation is key today. "Visits to traditional large-format supermarkets are down significantly — from eight times a month to six times a month — over the last few years, and new and emerging formats are serving different trip types."

Other natural products stores are experimenting with formats based on smaller stores and lower prices. A similarly named, but separate chain, Boulder, Colo.-based Sunflower Farmers Markets, founded and led by Wild Oats founder Mike Gilliland, offers natural and organic products in no-frills stores at what it touts as "the lowest possible prices." The chain, which launched in 2002, has 13 stores in Colorado, Arizona, New Mexico and Nevada, and plans to open seven more this year.

When Austin-based Whole Foods Market bought Wild Oats Markets last year, it said it planned to use one Wild Oats in Boulder to experiment with a convenience store.

And Hertel pointed to U.K.-based Tesco's launch of several Fresh & Easy express format stores in Southern California and Arizona.

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