Food Courts, Restaurant Circles . . . Why not Discount Grocery Malls?

[joeekaitis]

And by "Malls", I mean to include outdoor "strip" malls.

Both the fast food industry and full-service restaurants reap the benefits of being neighbors with the competition instead of trying to divide and conquer the affections of a hungry populace. Thus the prevalence of food courts inside shopping malls where McDonald's is cheek-by-jowl with Jack in the Box and restaurant circles around the parking lots where you can wave to someone at Olive Garden from your table at P.F. Chang's. Entire streets, like Hospitality Lane in San Bernardino, California are zoned for restaurants and hotels.

I might be late to the dance but do similar grocery-centric shopping centers exist where ALDI, Save-A-Lot and Grocery Outlet (as well as regional discount grocer variants) share a common parking lot because they're wooing similar clientele? Or are they so radically different (ALDI with their rented carts, Save-A-Lot with their carts that lock the wheels at the yellow boundary) that real estate developers never even entertained the possibility?

Oh, the thoughts that run through one's mind while writing up one's shopping list.

 

[vacerator]

Its all been

tried before.
A food store in a mall has dumpsters with thrown out meat and produce that stinks.
Aldi has a big part of the discount market share.
Walmart has hardline and food, as do Kroger now, etc., etc.

 

[petek]

I've never seen it for grocery stores sharing the same parking lot...   They're often across the street from each other..  Auto Malls or subdivision I've seen where the winding streets are purpose built for all the different dealerships

 

[fan-of-fans]

No, never seen two or more grocery chains in the same strip mall. I did used to see Walmart or Kmart together in strip malls with grocery chains, but this was usually the older ones that didn't have grocery departments. It's common to see dollar stores like Family Dollar or Dollar General share strip malls with grocery chains. But it is usually the older stores, newer Dollars are built alone now. And some grocery chains had lease agreements that wouldn't let the dollar stores sell certain foods such as milk, frozen food, etc.

Have also seen "lifestyle centers" that basically look like a street but are all stores. Basically an outdoor mall that looks like a main street.

 

[retro-man]

We have 2 Supermarkets in the same plaza. We have a Buy Rite in front of a Market Basket. There is parking between the 2. Market Basket is the larger of the 2 and newer. Both have been open for awhile and both seem to be busy.

Jon

 

[daveamkrayoguy]

Two or more food stores in the same plaza are like gas stations competing...  I see a gas station charging a few pennies more for its gas get more customers if it's easier & more convenient to get to...

 

One supermarket we had you had to make a right then a left around a traffic island to get to; it was on a divided highway...  So there I can see why it went out of business as those who could get to it via a right turn or make an illegal left were the lucky & few...

 

There is a Planet Fitness there now, so I can imagine how many people are going to get pulled over for a "No Turns" in their exercise gear...

 

Back to food stores & shopping malls, the former really is in small volumes for a reason--you don't want to lug around groceries, especially perishables, just because afterwards you want to look at & try on dresses--and they wouldn't be safer in a hot car, which is sadly what goes on at my store , although there, most customers are wiser, buying the dry goods first, then groceries second, w/ anything frozen bought last... I doubt there exists that mentality in mall clientele, as shopping center situations seem to be an unavoidable, but typical touch and go...

 

 

-- Dave

 

[vacerator]

K Mart food;

Back in the 1960's, and 70's, some K Mart stores had an adjoining supermarket.
The sign said K Mart food outside, but a local food chain operated them.
They leased the buildings from K Mart, and the signage was part of the agreement.
Eventually, the signs changed to the name of the food chain, probably with a lease renewal with higher rents.

 

[alr2903]

Maybe it is not a multi task most people like.  After a meal  most people spend less in a grocery store.  Other than cold weather it would not be wise to leave perishables in the car while in a restaurant.

 

[davey7]

I thought that most grocery stores had "do not compete" or "no compete" clauses in their leases (which also prevents, sometimes, competitors from taking over vacated premises, for instance when a store moves). I also have heard that landlords/developers like one store since it attracts other tenants to the strip centers - maybe grocers are loss leader tenants in them? Wonder if it's different abroad or even up in Canada?

 

[petek]

It's pretty much the same in Canada. In fact if I dropped you off blindfolded not knowing where you were you probably couldn't tell any difference without looking at the jumbo flag flying in the parking lots. Same stores, Walmart Supercenter sharing a lot with a dollar store,  PetSmart, Michaels and/or Best Buy etc and a McD's or BK, then a Lowes or HD etc across the road or in the next lot.  They all look the same pretty much anywhere in N.America now with slight regional differences in some of the store names. 

[this post was last edited: 10/7/2016-14:27]

 

[vacerator]

Davey7,

Oh, stores do have competition clauses under the uniform commercial code, but they have time limits.
Another store may not open within a certain distance for a time, but after that, it's fair game for all.
That's why we see so many different stores within short distances from each other.
Grocers do not keep loss leader stores anymore. Rents are too costly.
Competition is fierce.
A shopping center landlord may need to sublet a vacant space in order to pay the mortgage on the property. Empty store fronts are not attracting shoppers to the other stores in the center.

 

[davey7]

Interesting tale here on the south side. One of the only Dominick's (if not the only one) that wasn't snapped up by either Jewel, Mariano's or a smaller grocer was in South Shore. There was talk of a no compete, but mostly the LL had a really bad reputation. The Alderman (who also is my Alderman) called Bob Mariano out on the carpet and gave him a tour of the neighborhood and pressured him on the site. He told her the neighborhood had interest for them, but not that location. The city then threatened eminent domain on the LL who finally got a discount grocer in - not what the community wanted, but better than an empty store.

Petek - yeah, you have Zeller's (or used to) and Blah blahs.... My cousin used to be a manager at Canadian Tire out west.

 

[petek]

yeah.. Zellers shut down 2 or 3 years ago. Target didn't take an option on it not that they lasted long in Canada anyways, about 13 months.  Zellers couldn't compete really against Walmart and their store here was a dump. Much like a decrepit Kmart, which also shut down here years ago.   Walmart moved into town about 15 years ago give or take,, took over the old Woolco store at the mall, then they built a new Walmart on the backside of the same mall but much bigger almost supercenter sized.. They only stayed in that store for about 6 years and then built the bigger supercenter shown in the picture above about 6 years ago.. across the road almost. Interestingly Canadian Tire which was at the mall, then moved into that 2nd big walmart location when they moved out. It's now the biggest Cdn Tire in Canada. It even sold groceries for a while but that didn't pan out. 

 

[petek]

What store did he manage out west... Cdn Tire was a huge customer of ours and I visited quite a few of the stores in BC and Alberta. They and Sears built their western Canada dist centers adjoining our new rail container terminal in Calgary just before I retired.  

 

[vacerator]

Of course politics

makes friendly bed fellows when it comes to who gets what land or empty retail spaces. Walmart has managed to build every store it wanted to, regardless of community opposition from small store owners in the town.
Bottom line is, money talks.
Follow the money. How can small store owners hire better or more lawyers than Walmart?