In The News

From the Renton Reporter (Renton, WA):

Grocery Outlet opens in Highlands, with deals for Renton's frugal
By Tracey Compton

With about two months under its belt, the new Grocery Outlet in Renton is racking up sales and fans in the former Hillcrest Bowl location.

The store is part of a chain, headquartered in Berkeley, Calif., that's shown more growth than traditional shopping markets as of late, its Renton owners said.

"Grocery Outlet has seen substantial gains through the recession and has been able to sustain that new customer base," said Sheena Stephens, a spokesperson for Grocery Outlet.

"I think the economy we're in right now has really taken a hold on a lot of different people, so shopping habits are changing," said Jeff McNeil, co-owner with his wife Erin of the Renton Highlands store.

People are more frugal now than they use to be and will hold on to those habits like previous generations did after the Great Depression, he said.

The owners came to Grocery Outlet from a gourmet grocery background. Jeff McNeil has 36 years experience and Erin McNeil has 18 years. They've been married for more than two years, together for nine and decided to operate a Grocery Outlet store because of what they saw at the corporate level and at other stores.

"After talking to the owners, it was kind of their passion for the business and their commitment to the neighborhoods – that actually pulled us in," he said.

The McNeils visited 12 Grocery Outlet stores in Washington, in two days and consistently received positive feedback from the owners they met. They asked them if they would open a Grocery Outlet all over again and the answer was almost always "yes."

Jeff and Erin McNeil's visit to corporate headquarters also impressed them because of the emphasis on family.

About 85 percent of Grocery Outlet owners are married couples and a significant number of them are second generation family owners. Although there is no mandate for couple ownership, their business model supports family business, Stephens said.

"They seemed to have pretty strong values and we liked that," said Jeff McNeil.

Erin McNeil liked the family driven approach too. "We spend 20 hours a day here," she said, so having family as part of the business model was key.

What makes Grocery Outlet different from traditional grocery stores?

It's called opportunistic buying, a term the retailer uses to describe when they purchase products from a manufacturer's surplus "for pennies on the dollar." About 75 percent of their products are sourced this way, making the selection of products not always consistent. But, the company does try and source some of the basic products conventionally like other stores.

"It's kind of a treasure hunt," said Jeff McNeil.

He likes that they are located close to Safeway, which is in the next block. It makes for one-stop shopping for consumers to check out the deals at Grocery Outlet first. Then they can go next door to Safeway for the rare, seasonal or hard-to-find items, he said.

"We can't offer everything to everybody," Jeff McNeil said.

But, they cover all four corners of the grocery landscape. Shoppers who haven't been in a Grocery Outlet in awhile will be surprised to know they have fresh produce and meat in some locations. The Renton store has both, in addition to a wine section, health and beauty care, diary, frozen foods and organics.

For Thanksgiving dinner shoppers, this came in handy as the price to fill the table increased by about 1.3 percent this year, according to the American Farm Bureau Federation.

The McNeils are still trying to define their core customers. They say they have a pretty good balance of those that need them and those that seek them out for particular deals. In addition to the Renton regulars, they have received business from customers from Mercer Island, Bellevue and Issaquah.

One thing customers seem to appreciate is the Hillcrest Bowl touches the owners incorporated into the store design. Parts of the original hardwood bowling lanes line the checkout aisle floors. Bowling pins light up the checkout lanes and employees have some of the original lockers left over from the bowling alley days.

Coming soon, the owners hope to add bowling league jerseys to display, which people have already started to donate.

Customers come in and tell them they use to bowl on the premises and so do other Grocery Outlet workers.

"I can't even tell you how many people up in Snohomish County said 'I use to bowl there,'" said Jeff McNeil.

He and his wife trained at the Everett Grocery Outlet before opening the Renton store.