New grocery stores heating up the local marketplace

Within two miles of the planned WinCo is a Reasor’s, a Sam’s Club, a Wal-Mart Supercenter, a Target and a Natural Grocers. That’s something that WinCo doesn’t really mind, said grocery store analyst David Livingston.

“They’re going to be right at Wal-Mart’s level with pricing,” Livingston said. “They kind of keep Wal-Mart up at night. WinCo is a large grocery store. They’re employee-owned and very competitively priced.”

In the Tulsa market, Wal-Mart dominates. Its brands — Wal-Mart Supercenters, Sam’s Club and Neighborhood Markets — have about 50 percent of the market share, according to industry data. Wal-Mart has the most to lose but also has the most margin for error.

Livingston said WinCo isn’t only going to compete with Wal-Mart, but, because of its size, it will affect other traditional grocers like Reasor’s or even a local discount chain.

And WinCo will bring more than just competition for grocery dollars. It will bring competition for quality employees, too, something that Tulsa newcomers Costco and Trader Joe’s — with their relatively high retail wages — have brought as well.

“They also threaten the competition in the fact that they might attract good employees,” Livingston said. “That’s just as big a threat as the square footage that they’re putting in.”

Reasor’s may already be feeling the affects of new stores in the market. The chain has decided to closed its store at 51st Street and Harvard Avenue on May 1. It will be the second former Food Pyramid that Reasor’s had purchased to close. It closed a store at 71st Street and Garnett Road in late 2014.

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