International News - Kroger to secure market share by opening dollar sections in stores

Supermarket giant Kroger has opened trial dollar sections in a small number of its Food 4 Less stores.

In a tactical switch that Kroger hopes will help claw back market share from discount rivals, the US$50 billion (£32.21 billion) grocer has opened aisles in approximately 15 shops where items will be priced at less than a dollar.

In stores where most space will be devoted to the dollar range, there will be up to 15,000 food, household and general merchandise products.

Wal-Mart has overtaken Kroger as the largest retailer of groceries in the US, and dollar stores and drug stores have tempted customers away with cheaper offers.

According to data from consultancy Retail Forward, sales at US dollar stores increased by 6.8 per cent in 2002, ahead of the rest of the US retail market.

Two market leaders - Dollar Tree and Dollar General - have increased store numbers by 21 per cent and 15 per cent to 2,300 and 6,300 respectively over the last five years.

According to Retail Forward’s Dollar Stores and Other Small Format Value Retailers: ‘(We) estimate that the domestic landscape can support an additional 15,000 units - or about twice as many stores as the top 10 players in the channel operate today.’

Some 36 per cent of US households visited a small-format value retailer on a monthly basis last year, up from 26 per cent in 1997.