K mart's redesign creates a more American-ized Fare - redesign of American Fare hypermarkets

Kmart's Redesign Creates A More American-ized Fare

CHARLOTTE, N.C. -- With its second American Fare hypermarket, K mart has decided to give shoppers what they want: a better selection in a less intimidating store.

In doing so, the nation's No. 1 discount chain has kept pace with Wal-Mart, the second-largest discounter, in developing a distinctively American concept of a combined food and general merchandise store.

K mart's store designers moved away from the gigantic, Euro-style hypermarche concept, illustrated by such foreign-owned superstores as Carrefour in Philadelphia, Biggs in Cincinnati and Denver, and Auchan in Houston. Indeed, the new American Fare hypermarket, which opened April 1, moves away from the design concept of the first American Fare in Stone Mountain, outside Atlanta, squeezing out many of the elements that made Stone Mountain unit one of the most visually exciting discount stores in America.

Gone are such glitzy touches as a florist shop, upfront Reader's Marketplace and a card shop with the catchy name of, A Fare of the Heart.

Instead, the Charlotte store offers a more utilitarian look, offering 40 percent less selling floor space, 130,000 square feet, compared with 217,000 square feet.

Moreover, the Charlotte version crams 110,000 sku's into that smaller space, compared with the original 45,000 sku's in Stone Mountain.

Rather than competing with a narrow and deep selection of goods, American Fare now offers the variety of merchandise found in a fullsize K mart store, as well as the offerings of a complete supermarket.

But the second American Fare retains the upscale apparel brands shoppers won't find at their local K mart, such as Reebok athletic shoes and Pacific Trail, Bugle Boy, Le Tigre and Cherokee labels.

Wal-Mart Remerchandised

Wal-Mart also has remerchandised its three hypermarkets, increasing their offerings to include the products of a full-sized Wal-Mart discount store, plus those of a supermarket (DSN, April 9, 1990). Among American retailers, only Meijer, Grand Rapids, Mich., has been clearly successful with the huge, 200,000-square-foot hypermarket concept.

American Fare is remerchandising its Stone Mountain, Ga., store to match the offerings at Charlotte, said American Fare general manager Jim Glime, who expects the conversion to be completed in June.

Main Aisles Cut

To better utilize space, American Fare cut main shopping aisles in Charlotte to 16 feet from 20 feet in Stone Mountain and reduced side aisles to six feet from eight.

Other space savings came from eliminating separate shops in front of checkouts, such as pharmacy, greeting cards and books and absorbing those categories into the main part of the store.

K mart is planning to open its third American Fare in Jackson, Miss., in late summer and is considering the fourth of four planned units in Birmingham, Ala., home of its supermarket partner, Bruno's. The Alabama site, though, is far from definite, and K mart refused to confirm its interest in Birmingham.

American Fare hopes for a sales mix of 40 percent food, 60 percent general merchandise. However, a sampling of shopping carts seen on the second and third days of the soft opening showed shoppers were leaning heavily toward food and buying comparatively little general merchandise.

For the 40 front-end checkouts in Charlotte, American Fare switched to ICL's combined weighing and vertical scanning unit from Metrologic Instruments slot scanners used in Stone Mountain. In lawn and garden, it uses Metrologic hand-held scanners.

Reduces Spacious Feeling

In apparel, American Fare retained the distinctive, black fixtures on wheels that allow easy re-layout of the department.

Given the space reduction, American Fare wheeled those fixtures closer together, reducing the spacious feeling at Stone Mountain.

American Fare uses the same type of wheeled promotional platforms and fixtures for the power aisles and impulse racks at checkout.

Warehouse racking in food, lawn and garden shop and on the perimeter walls of the hard lines portions of the store remains, but within departments such as hardware and automotives, American Fare has dropped warehouse racking in favor of standard gondolas.

In the food portion, the produce and fish departments stood out in terms of quality presentation. The fish counter, for example, featured whole baby sand sharks and other whole fish gracefully laid out amid fish steaks and fillets.

The American Fare in Charlotte is located southeast of the city in an area of affluent developments of condos, apartments and single family homes. It sits about eight miles away from Wal-Mart's second "vendor store" and already has prompted Wal-Mart to trim some prices.

Wal-Mart's vendor store is an experimental 110,000-square-foot unit in which the discounter tries new ideas on merchandise display and fixturing suggested by its vendors.

In the most notable example of the pricing competition between the two newest discounters in Charlotte, American Fare was featuring 12 horsepower Murray, 38-inch riding mowers by massing about 30 of them outside its front door.

Wal-Mart's price on the same mower was $848, but in response to American Fare's price of $799, Wal-Mart reduced the price to $797 to undercut American Fare by $2 and retain its claim to having the lowest prices in town.

A sampling of other hard lines prices, however, produced mixed results.

American Fare, for instance, priced a 22-inch Murray high-wheeled mower with 5 hp engine at $224.88, compared to $179.94 at Wal-Mart.

American Fare priced an AT&T model 210 Trimline phone at $28.35, against $29.44 at Wal-Mart.

Reebok high-top basketball shoes, model BB4600, were priced $47.96 everyday at Wal-Mart, compared with $49.87 everyday at American Fare, $44.87 on ad.

Nu-Finish auto polish, 16 oz., was $4.34 at Wal-Mart, compared with $4.98, everyday, at American Fare, $3.97 on ad.

But American Fare beat Wal-Mart on Prestone anti-freeze at $5.95 a gallon, compared to $6.98, and Pennzoil motor oil was 97 cents a quart at American Fare, against $1.01 at Wal-Mart.

And American Fare prices the DP Airgometer air bike at $269.96, compared with $279.96 at Wal-Mart.

PHOTO : K mart's new Charlotte American Fare crams twice as many sku's into 40 percent less

PHOTO : selling space than its original unit in Atlanta, but retains its upscale apparel mix.

PHOTO : The new American Fare retains the innovative fixturing of the first prototype but the

PHOTO : width of shopping aisles has been reduced.

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