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REDERICKSBURG-area shoppers spend more money on groceries at Food Lion than any other store.
Food World magazine, an industry publication, recently released a 2004 market-share study that once again puts the Salisbury, N.C.-based chain ahead of Giant in sales here.
Giant's dominance of the area market has been slipping since 2001, according to the trade publication.
The latest issue of Food World also says a number of alternative grocery sources--such as discount and drugstore chains--are increasingly nipping at the two leaders' heels.
Food Lion, which has 25 stores tucked into strip malls throughout the area, bagged $254.6 million of the nearly $847 million in grocery sales rung up here over a recent 12-month period, according to the Food World report.
The calculations are based on population and weekly grocery expenditures by residents from April 1, 2003, to March 31, 2004.
Food Lion is successful because it has more stores here, and most are in areas where there is little competition, said Terri Maloney, Food World's editor.
Food Lion has 13 stores compared with Giant's four in Fredericksburg and the counties of Stafford and Spotsylvania. It also has a dozen more in Caroline, Culpeper, King George, Orange and Westmoreland--areas where the closest competition may be a CVS, Rite Aid or 7-Eleven.
Giant, still the biggest player in the Washington-Baltimore market, took home $124.55 million from its four stores here. Food Lion, however, racked up $140.8 million in sales in head-to-head local competition with the Landover, Md.-based chain.
One reason may be that Food Lion plays the convenience card, said spokesman Jeff Lowrance.
"We like to have our stores densely spaced," he said. "You don't have to drive very far in Fredericksburg to find a Food Lion."
The stores also are a smaller, more "shoppable" size than Giant's, according to Lowrance. A typical Food Lion has about 30,000 to 40,000 square feet, which is about half as big as the new Giant that will open off White Oak Road in Stafford later this year.
"Someone can park close to the front door, get in easily and find what they want, then go on with the rest of their day," he said.
Giant, meanwhile, is focusing on becoming a one-stop shopping destination, according to spokesman Jamie Miller.
The new 67,000-square-foot Stafford store, for example, will offer more prepared foods and general merchandise than its older stores. And there will be four self-service checkout lanes for customers who don't want to wait for a checker to ring up their purchases.
"That's where the trend is," Miller said. "We realize families are time-starved."
He also said customers haven't been affected by Giant's recent woes. These include a decision by Royal Ahold, the Dutch conglomerate that owns Giant, to replace its top management with executives from the Quincy, Mass.-based Stop & Shop Supermarkets, which it also owns.
"It really hasn't impacted the stores or the service we've been able to offer our customers," Miller said. "We're opening an average of 12 stores a year, a trend that's projected to continue for the next three years."
Other area grocery stores also did well. Ukrop's, which had lagged behind BJ's Wholesale Club and the Shoppers Food Warehouse in Spotsylvania County in 2003, bested both stores plus Costco in the 2004 survey. It posted sales of $25.42 million, a $710,000 increase over the 2003 survey figures.
And the Shoppers Food Warehouse in Stafford again came in third behind the five Food Lions and one Giant in that county. It posted sales of $24.71 million, a $2.4 million increase over the 2003 report.
Yet stores such as Wal-Mart and CVS are grabbing an ever-larger cut of area grocery sales. Wal-Mart, for example, boosted its sales to $93 million from $86.3 million in the 2003 survey. And CVS' sales hit $54.3 million, a $1.1 million increase over 2003.
These "alternate channel competitors," as Food World calls them, are doing well because they're adding more and more food items, Maloney said. Customers come to pick up garden tools, buy gas or get a prescription filled, and decide to pick up a quart of milk or box of cereal instead of fighting traffic to get to the grocery store.
"Now Target is starting to get into that," she said. "The first Target Superstore here [which will be in Leesburg] will have a whole grocery just like a Wal-Mart Supercenter," she said. "Even the regular stores are adding large food sections and freezers and refrigerators. They see that as a big opportunity."
To reach CATHY JETT: 540/374-5407 cjett@freelancestar.com