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SUPERMARKETS OF THE 1990S: 1-STOP SHOPPING IS REACHING NEW HEIGHTS

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As Salt Lake grocery stores move into the 1990s, they are refining one-stop shopping into a corporate art.

Buy your groceries, mail your letters, drop off your dry cleaning, pay your utility bills, deposit your paycheck, rent a video, buy a hunting license, fill your prescriptions, pick up tickets for the concert this weekend, and grab hot dinner for the family at a take-out window - all in one stop.Stores in Utah's intensely competitive market are scrambling for their niche in the one-stop shopping game. Dan's Food is trying to grab the upscale deli market with the expanded deli in its new Foothill Village store.

"It's the first example locally where you have a true, full kitchen and kitchen staff in-store," said Mark Peterson, director of marketing for Dan's Foods. "You don't go past any other deli where you look into a room in the back full of ovens and stoves and guys in chef hats running around cooking as fast as they can."

In most grocery stores, 95 percent of the deli product "is purchased in bags, brought into the store, put into bowls and resold," Peterson said. "We have a staff of chefs using their own recipes to create completely unique salads and entrees."

If the concept flies, the chain may introduce similar delis in other Dan's stores along the east bench.

Smith's Food and Drug Centers have led out in the hot pursuit of one-stop shopping. "We're putting in Chinese take-out food, dry-cleaning stores, sausage shops and smokehouses," said Richie Smith, president of the chain. He reeled off other Smith's innovations: "We'll be experimenting with Mexican food take-out. We put in tortilla-erias a year ago where tortillas are made fresh on the premise. We have put in fruit and juice bars. We are putting in one-hour photo services."

And of course the banks, recognizing the profitability of high-volume traffic when they see it, have begun opening their own outlets in local grocery stores.

In addition to the bewildering array of added services, modern grocery stores are expanding their inventories.

Harmon's grocery stores led the way in varied inventory. "No one in this state really has our entire variety," said Bob Harmon, store liaison for Harmon's. "That's one niche we feel has been an advantage to us. Everyone sells a can of beans, milk and eggs."

Even Dan's, traditionally an all-grocery chain, is expanding its inventory to include household goods and electronics, Peterson said. One-stop shopping is only one reason for the expanded inventory. Profit is another.

Grocery stores in Utah slip by on a slim .5 to 2 percent profit margin, Peterson said. Smith put it at 1 percent.

But the margin on hard goods is much higher. "You can certainly be more profitable selling some of these," Peterson said.

Dan's scramble for its niche has led it to form creative liaisons with local restaurants. The chain's stores offer coffee beans from the Salt Lake Roasting Company and fish from Gastronomy Inc.

Now San Francisco Sourdough Pizza - the 18-month-old fast-food outlet that has become the talk of downtown Salt Lake City - has opened an outlet in Dan's Foothill Village store.

There is a national trend toward renting out grocery store space to outside businesses like banks and restaurants, Peterson said. Those businesses realize that grocery stores give them access to a volume of traffic even malls can't offer.

"If you want to reach a lot of people, go where they have to go, and they have to buy food," Peterson said.

While Utah grocery stores brainstorm to find distinctive specialties that build a loyal customer base, they also share a strong consensus on what all shoppers will demand from them in the future.

Freshness. Representatives from Dan's, Harmon's and Smith's concurred that shoppers demand increasingly fresh produce, delis and bakeries.

The demand for freshness is up sharply over what it was even a few years ago, Smith said.

Shoppers also wants food that is easy to prepare. The delis, take-out outlets, bakeries and frozen food sections struggle to meet the demand for easy-to-prepare meals.

"The demand for frozen food has just exploded in the last five years," said Doreen Harmon, secretary of Harmon's. Particularly the demand for single-serving packages.

"I think the retailer that focuses on freshness plus meals that are easy to prepare at home will be the retailer that succeeds in the '90s," Smith said.

Customers are also demanding more service from grocery stores. Dan's Food - recognized nationally for its outstanding service - plays to that demand.

"Only five or six years ago, people were saying the service orientation would disappear," Peterson said. But the demand has only intensified.

Smith's is meeting that demand by increasing its number of store employees. Delis that had five employees five years ago now have 30, Smith said.

Then, of course, there is speed. That's what one-stop shopping is all about: meeting as many of the busy shopper's needs as quickly as possible.

Express check-out stands are increasing at the rate of rabbit populations.

"In the old days, we may have had one or two express check stands in stores. Today we have up to six to help customers get in and out quickly."

Shoppers used to do a week's worth of shopping in one trip, Doreen Harmon said. But now shoppers are stopping by grocery stores three and four times a week to pick up the items they need at the moment.

"It keeps us on a toes to make sure those customers with a few items get out quickly," she said.

Store size becomes an issue for the hasty shopper. Larger inventory and more speciality shops within a store require space. But stores that are too large alienate the busier shopper who wants to scoop up everything on a shopping list in a quick race down a few aisles.

Utah grocery stores are slowly getting bigger. Smith's hasn't built a store under 60,000 square feet for three years, Smith said. But the '90s won't bring the onslaught of massive superstores some might expect.

New stores opened recently by Dan's Foods and Albertson's Food Centers are medium-sized superstores at best. Harmon's hasn't forgotten the lesson of Vegas Village, a mammoth shopping complex in Las Vegas once owned by Ralph Harmon. The store was so big it even sold cars, Doreen Harmon.

But its size eventually drove customers away.

The '90s are more likely to bring innovative steps like the covered parking at the Dan's in Foothill Village. While covered parking is a standard concept for urban malls, Dan's is one of the first grocery stores in the nation to offer it.

"You can have a cool car in the summer and a dry car in the winter," Peterson said. Over-size elevators make it easy for customers and bag boys to get grocery carts to the underground parking. The elevators come up into the lobby of the grocery store, making the trip between car and store a surprisingly short one.

The coming years will also bring more stores into an area that already has more grocery stores per capita than almost any other part of the nation.

When one chain sees another chain succeeding in a particular location, it puts up a store next door. Witness the Albertson's shopping center that just opened a block east of the highly successful Harmon's shopping center on Fort Union Boulevard.

The competition may give corporate presidents a few ulcers, but it will benefit Utah shoppers.

"Any time competition moves into the area, you've got to become more aggressive in the way you compete. It generally makes you better," Doreen Harmon said.

The new Albertson's shopping center "made our management team a little sharper," she said.

As seen by the pullout of Farmer Jack and Safeway, Utah's grocery store climate allows only the fittest to survive.

"Better not make many mistakes," cautioned Smith.

"If you don't make the right decisions, it's very easy to lose your profit margin quickly," Peterson said.