Why Wegmans really is the best supermarket in the U.S.
By Roberto A. Ferdman May 13 at 1:15 PM
Welcome to Wegmans, the number one place to buy food in America.
Wegmans, the Rochester-based supermarket known for its fresh produce, reasonable prices, and happy employees, is moving to Brooklyn. And people are thrilled. News of the new store, which will open in 2017, and, in line with Wegmans’ strategy, will be enormous, has fired off all sorts of excitement.
But it has also raised questions, particularly from those unfamiliar with the brand and its allure. What is the deal with Wegmans? Why do people who know it seem to love it so? And is it really this grocery oasis in what increasingly feels like a desert of mediocre or at least interchangeable supermarket options?
I poked around a bit, because I was one of those people who knew little about the chain and why it’s so beloved. And you know what? I am now convinced. Wegmans really does seem to be a step ahead of, well, everyone else in the business. There are good reasons why year after year, Consumer Reports rates it as the number one grocery store in the country. Really good reasons.
“The first thing you need to know about Wegmans is it’s as special as people say it is,” said Burt Flickinger, who is the managing director of consumer industry consulting firm Strategic Resource Group, and has closely studied the supermarket industry for over 35 years.
At the moment, there are just over 80 Wegmans sprinkled across the Northeast, most which are found in New York (46) and near Washington D.C. (14), according to Wegmans’ website.
And all of them are huge.
The new outpost in Brooklyn will be 74,000 square feet, which will both be Wegmans’ smallest and Brooklyn’s largest. The recently opened Whole Foods in Gowanus, which is thought to be big, is some 20,000 square feet smaller.
“Inside each Wegmans is the equivalent of 8 to 10 other supermarkets,” said Flickinger. “The produce department by itself in Wegmans stores is twice as big as the total supermarket store volume of its average competitors in the U.S.”
Wegmans is also unlike most any other chain, in that it has what Flickinger calls 360 degree competition. It can compete with Whole Foods, because its produce is some of the freshest in the business; it can compete with Trader Joes, because its prices are some of the most reasonable; and it can compete with Wal-Mart, because its stores are, well, massive.
“Wegmans has achieved that trifecta by anticipating things others simply weren’t thinking about 30 years ago,” said Flickinger. “They were already emphasizing fresh, but then they bet on volume, and that has allowed them to not only sell high quality fruits and vegetables, but ones that never sit on the shelves for long.”
At the moment, the average supermarket turns over its inventory between 18 and 20 times a year, according to Strategic Resource Group. Wegmans, by contrast, goes through its produce as many as 100 times a year.
“That’s why their produce is almost always fresher than their competition’s,” said Flickinger.
But Wegmans’ food isn’t merely fresh, it’s also cheap. An independent analysis of prices at grocery chains by Washington consumer group Checkbook found that Wegman’s prices were 13 percent lower than the average prices found at Giant and Safeway. Consider that Whole Foods, whose food quality has been compared to Wegmans, just announced it is working to open a new chain of cheaper stores, effectively conceding that its current, decidedly pricey model is ill-suited for the future.
Part of the reason Wegmans manages to maintain low prices is that its turnover is so efficient. Wegmans has historically been very good about managing food waste, which can be a sizable cost for other grocers, according to Flickinger.
Another is that, similar to Trader Joes, Wegmans has recognized long ago that by being less reliant on big brands, and instead selling house-owned, private brands, they could manage their own prices.
Lastly, Wegmans is self-reliant in a way other grocers are not. Whole Foods outsources its distribution and doesn’t own its warehouses, which means it relies on (and has to pay) a third party to ensure timely and proper delivery of its food. Wegmans, on the other hand, is much more vertically integrated, and controls its entire distribution process.
And then there’s Wegmans’ unique store experience.
“You can’t talk about Wegmans without talking about its emphasis on the experience, on the theatricality of going to the grocery store,” said Jon Springer, who is the retail editor for Supermarket News. “It’s really very different in that respect.”
Within the seemingly endless spaces are a number of twists on traditional supermarket makeups. Wegmans has a food bar and prepared food section, much like Whole Foods’, ample sampling opportunities, like Costco, and customer service that rivals Trader Joes’.
That last bit is likely the result of the company’s relationship with its workforce. Wegmans has long history of rewarding its workers. The company was, for instance, offering college scholarships long before Starbucks announcement this year that it too would do the same. Wegmans regularly cracks the top ten (Exhibit A, Exhibit B) on lists of the best places to work in the United States. That bodes well for the estimated 600 jobs Wegmans expects to bring to Brooklyn.
There are skeptics of Wegmans’ reputation, especially now that the chain has grown well beyond its Rochester roots. One Buffalo resident, dismayed with what expansion has done to the grocery store, wrote a blog post about the dilemma titled ‘Falling out of Love: Wegmans and Me.” The company’s growth, according author Chris Ortloff, has come at the expense of its participation in the community.
Wegmans has also been criticized for its balanced approach to genetically modified organisms. Last year, the company chose not to require that products sold at Wegman supermarkets be labeled if they contain GMOs, a decision that is more in line with scientific consensus than consumer sentiment.
But Wegmans’ dissenters are few and far between. The result of the supermarket chain’s virtually unparalleled breadth of positives—Wegmans’ ability to offer quality, quantity, consistency, price point, and experience, and all at a place where workers are visibly happy—is that those who know it know that it is indeed unique.
“Wegmans was on to so many trends before anyone else was even thinking about them,” said Jon Stringer, who is the retail editor at Supermarket News. “People who go there see what that momentum has led to. That’s why they like it so much.”
Like is probably an understatement.
“There’s a joke up in Buffalo that with all the bad weather this past winter, people would go shop at Wegmans just to cheer up,” said Flickinger. “That tells you how people feel about this place.”