Giant Eagle to enter discount grocery wars with Valu King brand
By Thomas Olson
Published: Thursday, June 28, 2012, 5:44 p.m.
Updated: Thursday, June 28, 2012
Five years after debuting Valu King Food Market in the Cleveland area, Giant Eagle will bring the discount grocer concept to the Pittsburgh market sometime this fall.
The O'Hara-based supermarket chain signed a lease for space on McKnight Road in Ross, said Giant Eagle spokesman Dick Roberts. The store will combat other hard-discount grocery stores such as Bottom Dollar, Save-A-Lot and Aldi, which have moved into this market in recent years.
“This will be the first Valu King in the Pittsburgh area,” said Roberts. The size and construction schedule for the store have not been determined yet.
“There's no question that the segment of people interested in low-price groceries is growing, and people are becoming more aggressive at finding those low-priced stores,” said Bill Bishop, chairman of Willard Bishop LLC, a retail consultant in Barrington, Ill.
While new to the Pittsburgh region, Valu King stores are familiar names elsewhere. There are four stores in northeast Ohio, two in Erie, one in Johnstown and one in Columbus.
Giant Eagle, which has about 230 company and franchised grocery stores, opened its first Valu King in the Cleveland suburb of Eastlake in 2008. Smaller than the typical supermarket, the no-frills store carried Giant Eagle brands, such as Valu Time and Top Care.
Giant Eagle inherited the Valu King name with its 1980s acquisition of grocery supplier Tamarkin Co., Youngstown, which owned and ran several Valu King stores as full-service supermarkets at the time. Giant Eagle downsized and made over the concept four years ago.
“Valu King has been very successful in northeast Ohio and a very important check-mate against folks like Bottom Dollar,” said Burt Flickinger III, managing director of Strategic Resource Group, N.Y.
“It's a superb strategic move by Giant Eagle,” said Flickinger. “It will also make it harder for other competitors to come in from the outside the market because Giant Eagle will have a different format for every type of shopper.”
Roberts said the Valu King in Ross might “differentiate itself from other discount stores” by including offerings such as fresh produce, a fresh-cut meat counter and a deli counter. But those decisions have not been made yet, he said.
However the new Valu King is configured, Giant Eagle will need to meet other discounters on price, said Bishop. A typical “broad basket of goods” from an Aldi, for instance, is priced about 20 percent lower than a full-service supermarket. It has 10 stores in the Pittsburgh region, according to its Web site.
“I can't imagine a company as good and smart as Giant Eagle trying to compete without Valu King's prices being pretty darn close to Aldi or Save-A-Lot,” said Bishop.
Thomas Olson is a staff writer for Trib Total Media. He can be reached a 412-320-7854 or at email@example.com.
I am friendly with people in a community in Western Pa who have a Valu King store. It competes with other discounters and is doing well, despite being within 2 miles of a Giant Eagle store. It's all a matter of whether you want full-service or great prices. I daresay we all way each at particular times. Would welcome a Valu King in northern to central Washington County. It is sorely needed.
Submitted by: John on Friday, June 29, 2012
Good deal for all.
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