Las Vegas Sun

July 21, 2019

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Looking to get Lucky

Inside and out, it looks just like 21 other Lucky supermarkets in Southern Nevada.

But there's something different about the store at 3120 N. Rancho Drive, the one at the corner of Cheyenne Avenue that serves the fastest growing section of Las Vegas.

It's going to close.

"This store's going to close?" asked one incredulous shopper when asked if she would follow Lucky to one of its new locations in the northwest. "They look like they're gearing up for more business, signing people up for their new card," she said as she walked to her car.

The shopper was right. It turned out to be a Lucky coincidence that the Buena Park, Calif.-based supermarket chain unleashed a full-court press marketing its new Lucky Rewards Card discount promotion on the eve of opening three new stores in the Las Vegas Valley.

Shoppers who sign up for the free card get special discounts at the checkout counter at Lucky stores and at Sav-on Drug, a sister company that operates under the umbrella of publicly traded American Stores Co. of Salt Lake City.

At the end of 1995, American Stores had 1,650 properties (682 of them drug stores) in 26 states, employing about 121,000 people. It had about 44.1 million square feet of floor space and was either No. 1 or No. 2 in market share in nearly every locale.

The marketing blitz and the three strategically placed grocery stores opening in the next three weeks could give Lucky a big enough boost to vault past No. 1 market share leader Smith's in Las Vegas.

Smith's, which operates 18 supermarkets in Las Vegas and 21 in a Southern Nevada designated market area defined by the A.C. Nielsen Co. as Clark, Nye and Lincoln counties, is the leader, according to a survey by the Stamford, Conn.-based Progressive Grocer Associates.

Four of the 18 stores are the company's Price Rite warehouse operations in Las Vegas. Smith's draws 29.4 percent of Las Vegas' market and 30.1 percent in Southern Nevada.

Lucky, with 22 stores in Southern Nevada, all in Las Vegas, draws 24.6 percent and 21.5 percent, respectively.

But with three new stores opening their doors -- the first one Wednesday at Cheyenne Avenue and Soaring Gulls Drive -- Lucky has the potential to scramble the market share numbers.

Priscilla Donegan, managing editor of Progressive Grocer magazine, a trade publication for the industry, said there are a number of variables behind the impact a store opening has on market share.

"If you're taking on a broader market, it's bound to have an impact," said Donegan. "That's just common sense."

But pricing strategies and services provided by stores also have an impact in the ability to draw customers. That's where the Lucky push could affect all local consumers -- competitors will improve their stores or could lower their prices to build the volume they need for growth.

Although many shoppers are passionate about their loyalty to their favorite grocery stores, researchers say many shoppers choose locations closest to their homes.

Donegan said in a 1995 survey of shoppers, convenience of location ranked eighth among 45 categories of how shoppers select stores. The seven categories ranking ahead of location -- cleanliness, low prices, pricing clearly labeled, accurate price scanning, accurate pleasant checkout clerks, freshness dates marked on products and good produce -- are far more subjective.

Considering that Las Vegas' competitive market forces grocers to stay on the cutting edge in cleanliness, freshness and price scanning policies, location is the battleground where companies try to gain an edge. Strategies are a well-kept secret.

For example, the four major grocery chains acknowledge that the new Summerlin South neighborhoods will be important to their companies. But none would reveal specifics on their strategies for serving the area.

Assuming that location is the key to success, Lucky is looking at big potential in the northwest:

* On Wednesday, the company will open at Cheyenne and Soaring Gulls. It will be the first supermarket outside of Summerlin to locate west of U.S. 95. It should draw from Desert Shores communities and numerous neighborhoods along west Cheyenne Avenue and Craig Road, and could steal customers from an Albertson's store at Cheyenne and Rainbow Boulevard, a Vons at Cheyenne and Jones Boulevard and a Smith's at Craig and Rancho Drive.

* On March 5, a store at Craig and Camino al Norte will open. It's right on the driveway to Rancho del Norte and the Eldorado neighborhoods in the center of North Las Vegas' Golden Triangle. The new store has the potential to steal customers from Vons at Lone Mountain Road and Decatur Boulevard, an Albertson's at Craig and Decatur and the Smith's on Rancho -- until Vons enters the market with a new store at Craig and Martin Luther King Boulevard, cater-cornered from Lucky.

* On March 12, Lucky will open a third store at Jones Boulevard and Tropicana Avenue, serving neighborhoods in southwest Las Vegas. The new store should stimulate direct competition with Smith's, which has a store just across the street.

Although Lucky spokesmen say they had no intention of having a three-week parade of grand openings in Las Vegas -- the deals and construction schedules came together coincidentally -- the impact on the city will be similar to the opening of a large new industry.

Between the three new Lucky stores and the three adjacent Sav-on stores opening their doors, more than 500 new jobs are being provided, even with the closure of the Rancho store.

"It's a little bit of a strain on staffing, but we're up to the challenge," said Bob Miller, district manager of Lucky in Las Vegas.

Miller said between 150 and 175 employees are being hired per 60,000-square-foot superstore -- the largest category the company operates in Las Vegas. Employees of the Cheyenne store opening this week have been trained on site, while others have attended a training facility the company operates at Tropicana and Eastern avenues.

Miller said about 30 percent of the hires are from within the company, including transfers and about 55 working at the store that's closing. The rest are new employees, some lured from competitors, others coming from a pool of new Las Vegas residents with supermarket experience.

The new stores will offer a variety of services common in the city's largest markets -- delis, bakeries, fish cases and floral departments. Lucky also offers a centralized location for pet products and each of the new stores will have full-service Wells Fargo Bank branches.

The U.S. Postal Service has contracted with Lucky to develop full-service satellite post offices in some of its stores. The Cheyenne store will have a post office, replacing the satellite branch on Rancho. There are no plans for post offices in either of the other two stores.

"Each post office negotiates individually with our stores depending on their needs," Miller explained. "We like having them in our stores, but it's really up to the post office as to whether one is needed."

With the new stores comes a greater emphasis on perishable goods. Miller said 33 percent of the stock is now perishable, reflecting the company's research of what customers are looking for and their changes in lifestyle and eating habits.

The Craig store will be open daily from 6 a.m. to midnight while the other two stores will be open 24 hours. The new managers for the stores are Tom Pelle at the Cheyenne store, Cindy Long at the Craig operation and Randy DeCarlo at Tropicana.

Although Lucky is taking a business-as-usual approach to the openings -- the company has had multiple-store kickoffs in other markets -- it will do a little extra with the unveilings.

Judy Decker, director of public relations for the company, said each store will open at 5 p.m. with spotlights and other high-visibility attention-grabbers. The late afternoon openings are designed to attract potential customers on their way home from work, a high-volume time for most stores.

"It's going to be like a premiere, per se, with searchlights and a real gala event," said Decker.

The opening of three new Sav-on drug stores adjacent to the new Luckys didn't get the same pomp, but they're already drawing customers.

Between 30 and 40 jobs were filled at each Sav-on, which all opened Jan. 29. Bob Monroe, who oversees the Sav-on operation in Las Vegas, said the 17,275-square-foot stores are not the largest within the company but represent the new slimmed-down prototype that includes over-the-counter medications, vitamins, homeopathic products, cosmetics, liquor and a one-hour photo finishing department.

In addition, the new Sav-on stores have drive-through windows for prescription pickups, a feature the company successfully tested in the Midwest. The feature already has been adopted by Walgreens in its five Southern Nevada stores. Walgreens and PayLess are Sav-on's primary competitors in the Las Vegas market, although each supermarket chain as well as discount department stores Wal-Mart and Kmart operate pharmacies in their stores.

Although the future looks bright for Lucky, not everyone is as excited about the three openings as the company representatives and residents near the new stores who won't have as far to drive to shop.

The biggest fallout could occur for businesses located in the shopping center at the soon-to-close Lucky anchors at Cheyenne and Rancho.

Sam Chen and Sean Seifried operate small restaurants near the Lucky market.

Chen said he will miss the convenience of having a supply of produce nearby when Lucky leaves. He runs Sam's Taco, a small shop that offers an unusual menu offering Chinese, Japanese and Mexican food.

Seifried, the manager of New York Pizza & Pasta, expects a downturn in business when Lucky closes its doors.

"We get a lot of traffic because of the Lucky store," said Seifried. "We'll still get some with the mattress store (next door), but Lucky brings in the most for us."

As for the regular customers of the old store, they'll express their viewpoint with their wallets.