Grocery store finds popularity where for years no other tried

By Sam Skolnik

Monday, July 13, 2009 | 2 a.m.

It took years for Las Vegas officials to find a grocery store willing to do business in the downtrodden neighborhood that was once the thriving center of the area’s black community.

And by the time the Buy Low Market opened in September at the corner of Owens Avenue and H Street — replacing a Vons that closed in 2004 — the region was sliding into recession.

Yet by all accounts, the store appears to be integrating itself successfully into the neighborhood and making strides toward profitability. After operating in the red for its first nine months, the store broke even last month for the first time, according to company officials.

Strictly on word of mouth, the store is averaging 1,500 customers a day – 25 percent more than projected, according to the store’s management.

“Everything is going better than we had hoped,” said Buy Low’s executive vice president, Nader Vazin. “We are happy.”

That’s good news for city officials, led by Ward 5 Councilman Ricki Barlow and the city’s Redevelopment Agency, which committed up to $950,000 in grants for the store’s first seven years to help ensure the market remains viable. The funds include up to $200,000 for equipment purchases and up to $100,000 per year in store improvement and remodeling rebates.

Barlow said several constituents have told him how important it is that they no longer have to travel for miles to buy groceries. This is especially the case for seniors and others who rely on public transportation, he said.

“The community overall is very happy and pleased with the grocery store,” Barlow said. “Buy Low was able to come in and turn the lights back on, and really jump-start that entire area again.”

The Buy Low Market chain has five stores, including three in the Los Angeles area and one in Provo, Utah. Buy Low is one of the brands operated by K.V. Mart Co.

The stores specialize in serving inner-city residents. According to the company’s Web site , the markets “cater to the tastes of the ethnic communities surrounding each store.”

The wide variety of products at the Las Vegas store – from a large bin of uncooked pinto beans to roasted whole chickens to various dried peppers – seems to reflect the store’s broad customer base.

On a recent Thursday morning, the market was humming with a melting pot mix of Hispanic, black, white and Asian customers, some of whom said they were grateful that the store was lured to their community.

“I see a lot of people here, they have no transportation,” said Gloria Powell, who lives near the store. “This is a very good thing for everybody.”

Another shopper, Chuck Davis, said although he’s now glad he doesn’t have to drive five miles to buy groceries, that’s not the main reason he likes the Buy Low. It’s the selection and the prices that appeal to him.

Indeed, the food prices – especially for some produce and meat items — are so low that it seems doubtful the store is profiting from their sale. For example, Granny Smith apples were on special for four pounds for a dollar. A produce manager said the usual selling price is two pounds for $1.29.

At a grocery store a few miles away Granny Smiths were selling for $1.49 per pound.

The bargain-basement prices are intentional, said Vazin. The store’s strategy is to sell most items under or at cost for the first year to build a loyal customer base, he said.

The strategy resulted in significant early losses for the store – including a first-month loss of about $200,000. That figure doesn’t include the expense of getting the store up and running, including $200,000 for new refrigeration units.

Vazin and the store’s director, Alfredo Alvarado, said they plan further improvements to the store, some of which will be paid for, at least in part, by city redevelopment funding. Most immediately, they said, they plan a $400,000 upgrade to the meat department, which will create jobs, said Alvarado.

The store has 120 employees, about 95 of whom are full-time workers, he said. Many are from the neighborhood.

These kind of investments, Alvarado said, signal that the store’s owners are dedicated to Las Vegas for the long haul.

“I get a lot of positive vibes,” Alvarado said. “All I see is commitment to the store’s success.”