Putting Grocery Outlet to the taste (and value) test
Eating on the Edge: A deep-discount grocery chain, Grocery Outlet is loaded with bargains and lots of surprise variety. It's far from hip, like Trader Joe's, but it's a smart place for opportunistic shoppers.
Hugo Kugiya
The one-mile section of 4th Avenue South between the football stadium and the West Seattle bridge is more familiar to craftsmen and contractors than to diners and cooks. People descend here with shopping lists for things like doors, tires, electrical cable, plumbing fixtures, tile, and lumber.
The port is nearby, and the area functions as a depot for the city, a place where the essential stuff of modern life is gathered, stored, and distributed to the populace around it.
It's not a food destination, but there are a few interesting (and a lot of uninteresting places) to eat and buy groceries, although they are not the first places that come to mind when shopping for a gourmet meal. For those with a food fetish, the fantasy really begins at the market, like one of the neighborhood farmer’s markets, or Uwajimaya, the patchouli-scented PCC Natural Market, the Metropolitan Market, or Whole Foods, the Banana Republic of supermarkets.
On 4th Avenue South, food is generally sold in bulk, at Costco at one end or at the smaller and far more prosaic Cash & Carry to the north. And on the same block is a branch of Grocery Outlet, the extreme-discount chain that seems to be spreading all over town. Last weekend, Grocery Outlet opened its 156th store, the new one in Spokane.
Grocery Outlet is part of the deep-discount industry, which has thrived during the current recession. The national chain of 99 Cents Only Stores (Big Lots and Dollar General are competitors) was recently acquired at a 32 percent premium by a private equity firm.
“Certain things have fared well in the recession,” said Richard Johnson, a vice president at the New York-based Greenberg Group, real estate advisors to the retail industry.
Outlet malls, for instance, “are booming,” Johnson said, because of “the very low cost of entry.” Renting space in an outlet mall is cheaper than renting space in a conventional mall. Luxury retailers and discount retailers have done well the past several years, while the middle has floundered, a sign of the economic stratification going on in the country. “The rich keep getting rich, poor are doing poorer,” Johnson said.
Melissa Porter, the vice president of marketing at Grocery Outlet, said sales growth has been strong since the recession took hold in 2008. “We tend to do well when times are tough and consumer confidence is low,” she said.
The Grocery Outlet at 1702 4th Avenue South is one of 24 within 50 miles of Seattle. You'll find others at Crown Hill, Madrona, Lake City, and Bitter Lake, with a total of 24 stores in King, Pierce, and Snohomish counties. The one in SoDo is owned by an Afghani-American couple, Masud and Fereshta Popal. About 90 percent of its stores, Porter said, are run by a husband and wife. The chain seems to attract enterprising couples.
Under the operations agreement between store operators and the corporation, operators pay the expenses of running the store (employees, utility bills, upkeep), while the corporation pays for the building and purchases the inventory. The corporation splits the profits with the store operators.
While the Cash & Carry tries to serve restaurant owners and bulk buyers, Grocery Outlet caters to the individual consumer and appeals most to someone who enjoys the hunt. “Our customers like to shop opportunistically, like we do,” Porter said. “It’s not Whole Foods and it’s not meant to be.”
Traditional supermarkets promise variety and consistency. You can buy 10 brands of salad dressing in five sizes and 30 varieties. That variety is what you pay for at QFC or Safeway. At Grocery Outlet, you might find only a few different kinds of ketchup or mayonnaise, maybe just one, but you will find it at a deep discount.
Grocery Outlet started in San Francisco in 1946 as Cannery Sales, a distributor of government surplus food, mostly dry and canned goods, the stuff doomsday movies are made of. This basic, unglamorous business plan operated successfully under the radar in the Bay Area for decades under various names and partnerships.
Cannery Sales became US Markets, before absorbing another supplier of surplus food called Big Bonus Foods. After acquiring another supplier, Globe of California, it became simply Canned Foods in 1970. Canned Foods sold just that — surplus, closeouts, and discontinued products that could be stored easily and sit on shelves indefinitely.
In the 1980s, Canned Foods added frozen and fresh foods to their product lines and opened scores of retail stores all over the West, changing its name in 1987 to Grocery Outlet. Grocery Outlet now has 150 stores, mostly in California, Oregon and Washington (with a few in Idaho and Arizona and Nevada), many in rural areas.
The store’s discount philosophy remains intact although its products are now much more varied, and nuanced: guava nectar, bacon-wrapped tenderloin, and turnip greens. It is not dissimilar to Trader Joe’s. Both are small, folksy, idiosyncratic, discount grocers that make up for variety with surprise.
Trader Joe’s, which started as a chain of convenience stores in the 1950s, has more than twice the number of stores as G.O. all over the country. It has become the grocer of choice for hipsters all over, with its kitschy, tropical theme. The checkout line in the chain’s Union Square store in Manhattan routinely snakes around the entire store.
If G.O. falls short of Trader Joe’s, it is in the promotion of its image. While Trader Joe’s is uniformly viewed as a high-end, neighborhood amenity, opinions about Grocery Outlet vary. On Yelp, it is playfully referred to as “Gross Out.” But in general the reviews are positive. Most expressed initial apprehension, followed by pleasant surprise.
My experiment at Grocery Outlet went something like this: For $20 or less, excluding the cost of wine, I would attempt to buy the ingredients of a multi-course, gourmet meal for two. (I did not purchase basic pantry items like oil, spices, herbs, and butter.)
“We’re not necessarily selling the cheapest products for the cheapest price,” Melissa Porter said. “People are often surprised what they find at our stores. We carry quality produce, specialty imported cheese.” So I put this to my informal test.
For my surf-and-turf entrée, I found two 6-ounce beef fillets (antibiotic and hormone-free) wrapped in bacon for $4.99, and a pair of similarly sized tuna medallions for $3.29. Both were vacuum-sealed, the tuna frozen. I seasoned the fillets with salt and pepper and grilled them. I marinated the tuna medallions and seared them in a skillet. Meat, it turns out, is kind of a loss leader for G.O., which does not make much profit from it, Porter said, but it gets customers into the stores.
G.O.’s magic is complicated and, Porter said, does not simply rely on selling food about to expire, a common assumption. It takes advantage of the supply chain, creating efficiencies for its suppliers who in turn sell their products at a deep discount.
G.O. sells items that are discontinued, or mislabled. Sometimes a manufacturer changes the packaging and has to get rid of everything in the old packaging. Sometimes special, promotional packaging is created for a product — for example, a boxed cereal is timed to the release of a popular movie — and then the promotion expires.
For the vegetable course, I found a one-pound bunch of asparagus, and a one-pound bag of brussel sprouts for $1.99 each. I grilled the asparagus and roasted the brussel sprouts with garlic and red pepper flakes.
I bought a box of linguine for 89 cents, and tossed the noodles with garlic, baby spinach ($2.99) and par-boiled, crushed tomatoes ($1.99 for a half dozen, still on the vine). Grand total: $18.13 with plenty of leftovers. It might not have been the greatest meal I’ve ever made, but I’ve eaten far worse after spending far more at a restaurant.
I also found a bottle of Chilean pinot noir for $16.99, a 2005 Casa Marin that seems to go for anywhere between $25 and $60 on various wine websites. At $50, it would not have been worth the gamble, but for $16.99, it only had to be good not great.
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Comments:
Posted Mon, Oct 31, 9:06 a.m. Inappropriate
We used to pop into our Yakima G. O. only occasionally over the past few years. There were some definite finds. A big box of unfolded puff pastry for dirt cheap. Chocolate soy milk for under a buck a quart.
But what's really interesting to me now is that the local store has taken advantage of a recent legal change to do in store wine tastings once a month. There are some finds in the wine department, too, in terms of "quality price ratio" or QPR, as we wine geeks like to abbreviate it. In some instances we've found older vintages that are right their peak.
But it was a bit of a crapshoot before the tastings.
They serve appetizers along with the wine, and the pourer is knowledgeable. As required by law, they serve in a contained area and check IDs. They essentially wall off the wine dept. with merchandise so there's only one entrance, manned by the ID checker. The owners (another husband & wife team) are usually present for these events, and I asked them if they saw a positive impact on sales. They said yes, so I expect this feature to stick around.
So perhaps other G.O.s will do it, too. I would encourage Seattle customers who are interested to lobby their stores for this; it appears to be a win-win. Have them call the Yakima store and ask about their experience.
Oh, and if you find something you really like, don't mess around. Buy a case or whatever you can afford, because it will probably go fast and not come back.
Posted Mon, Oct 31, 9:31 a.m. Inappropriate
Be very, very careful about the quality. Because the vast majority of the offerings are pesticide ridden, wildly processed, full of high fructose syrup products. A number of the producers have labor law violations out in the field, as well.
Posted Mon, Oct 31, 10:07 a.m. Inappropriate
Interesting. I've only ever been to the Grocery Outlet on Martin Luther King (formerly a Red Apple), and I've never tried to fill my cart, especially with anything perishable. I may have to take another look.
One thing I do remember is that the personal-care items looked a little iffy (I perhaps shouldn't be, but I was nervous about buying pharmaceuticals labeled "Made in India" — at least it wasn't "Made in China"), and that the batteries simply didn't work. That is to say, they were drained — the package I bought and the replacement I was given.
Posted Mon, Oct 31, 9:25 p.m. Inappropriate
I poked my head into the GO in Bellingham once, and didn't see anything really compelling, price-wise or otherwise. I'll have to take a closer look.
Trader Joe's is proof there is such a thing as brainwashing... there is nothing there that isn't better AND cheaper anywhere else. Target's wine cubes beat Two-Point-Five-Buck Chuck any day...
Posted Mon, Oct 31, 11:02 p.m. Inappropriate
I've been a patron of the "Groce Out" since college.
They key to shopping there is to avoid anything you wouldn't normally buy in a standard grocery store. That's how you avoid the crap. What remains will still be cheap as all hell.
The funniest things I ever found were giant boxes of Cheerios for cheap, like less than a dollar. They all had a picture of Michael Phelps on them, right after he had that marijuana scandal. Can't have a weed-smoking super-champion be a role model for suburban children, but it's okay for the kids whose parents shop at MLK and Union.
Posted Tue, Nov 1, 6:45 a.m. Inappropriate
I pop into the local GOs every couple of weeks to see if there's anything worth picking up. Some of the good deals have been roasted green chiles, Pomi cube-pack tomatoes and real San Marzano tomatoes for 88 cents a can. Needless to say, I bought a case.
I also have a network of friends who shop GOs and we advise each other about decent wine deals we come across. The one thing to pay attention to is the expiration date of some of the products as they can be within 2-3 months. I never buy meat or produce there, however. My trust doesn't go quite that far.
Posted Tue, Nov 1, 12:45 p.m. Inappropriate
This matches my observation that there's no compelling reason to go out of the way to Trader Joe's. They are a "boutique" store on top of that, so it's impossible to use them for your weekly shopping unless you have esoteric tastes in groceries. The one thing I used to occasionally stop by a Trader Joe's for was their pizza dough (when it was in stock). Now, however, it's possible to get pizza dough just as good at Safeway (yes, the land of Cragmont and Townhouse). And the store isn't a half hour detour away!
BTW, I'm still no fan of Safeway, but give the devil his due.
Posted Tue, Nov 1, 3:51 p.m. Inappropriate
dbreneman,
There may be few compelling reasons to go out of the way to go to Trader Joe's if you're looking for weekly shopping, I think because Joe's poor cousin, Aldi's, was designed to do that. Same parent company, but no outlets yet in the Northwest. It has one brand of each staple item; that is, milk, toasted oats, honey, bread, etc. It tastes like the brand names but at generic prices. The store size is about the same as Trader Joe's but it pretty much covers all the staples, leaving Trader Joe's for the fun stuff.
I do miss the GroceryOutlet. It was one of the highlights of a trip to Burien. I could pretty much cover the weekly list, if it included discount scallops or chateaubriand, which is sometimes did.
Posted Tue, Nov 1, 4 p.m. Inappropriate
I've been to plenty of Aldi stores in Europe. I had no idea that they had expanded to the US. Interesting.
Posted Wed, Nov 2, 7:28 a.m. Inappropriate
I do most of my weekly grocery shopping in or near SoDo. I think someday that I will lead people on a great grocery tour.
From north to south you can start at Big John's PFI for European delicacies and cheese. This is what Trader Joe's was like before it went corporate. The next stop is Grocery Outlet. Not everything there is a bargain, but a lot of it is. If you see something you like you better get it; it may not be there next week. Then on to Cash and Carry, which, despite its name, accepts credit cards. This is a great place for rice, oil, spices, potatoes, onions, and a lot more. Definitely the place to go if you're hosting a barbecue for the neighborhood. Jog west on Holgate for Wine Outlet or continue south to Lander to Esquin if you already know what wine you want. Stop in at the Franz bakery store just south of Lander for bread and english muffins. From there you can run down to Costco for a couple items before you head up to Beacon Hill and McPherson's for your produce. The tour ends at Fou Lee at Alaska and Beacon for Asian food items.
All along the way you should be ready to risk a couple bucks on something you've never had before, maybe even something that you've never even heard of.
Posted Wed, Nov 2, 9:16 a.m. Inappropriate
Got their fidge magnet, "Overshop Underspend".
Having all fruits and vegetables unit priced is the way to go. Saves me the time of going to Safeway or the Co-op, putting a watermelon on the scale and do some rough math to find out it is 7 dollars and then put it back.
Posted Thu, Nov 3, 8:16 a.m. Inappropriate
coolpapa,
You nailed it. I lived on Beacon and didn't know half of this. There's an article in there somewhere...pitch it to your friends at crosscut? I was never able to figure out how to crack that sushi factory in Georgetown. I assume it's still there. Why don't they have an outlet store? You know, for the California rolls where the seaweed rap unraveled. People would camp out for that.
Posted Sat, Nov 5, 6:42 a.m. Inappropriate
You want sushi in Georgetown? Go to Maruta. Go in the afternoon when the sushi in the case is marked down but still good.
Posted Sat, Nov 5, 11:33 a.m. Inappropriate
Forget the wine deals -- they have nothing to do with what's really going on in GO. There's a definite theme to the store, and it's disturbing. The radio station that plays in the Lake City store has a DJ who talks about crooked politicians, playing to the assumed attitudes of poor people. The cosmetic products are slanted toward African-Americans, which to me assumes that they are mostly low-income and the major customers of this kind of store. The canned goods are off-label, as are most other packaged stuff. The vegetables and fruits are very tired; many look like they're near rot. There's tons of high-fat, high-sugar products, without the healthier stuff that competes with the former, because high-fat, high-sugar stuff is satisfying to people who can't buy better food.
The whole scene makes it clear that we're in a split society. 40 years ago, grocery stores were grocery stores. Now there's Whole Foods for the 1%, Safeway for the people who still have decent jobs, and Grocery Outlet for people who can't afford Safeway. And, of course, food banks for people who can't afford GO.
Posted Tue, Nov 8, 6:22 p.m. Inappropriate
I've discovered Grocery Outlet & shop there quite a lot. There are things that they don't routinely carry which I need to pick up at other nation-wide chain groceries. I've found the staff helpful, both in Lake City and in Crown Hill which are the only two stores I've sampled.
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