Retail Innovation Memo - Breaking News: Hybird Natural Grocery-Convenience Store Locali Conscious Convenience Opens Tomorrow In Hollywood, CA USA

Locali Conscious Convenience, the first unit of the small-format, "green" natural and locally-focused hybrid grocery-convenience stores of what retailing entrepreneurs Melissa Rosen and husband Greg Horos hope to soon grow into a chain, opens tomorrow (Thursday, January 22) at 5825 Franklin Avenue in Hollywood, California, co-founder and co-partner Melissa Rosen tells Natural~Specialty Foods Memo (NSFM).

We first reported on and wrote about the new, innovative format and store's development in this September, 2008 story [Small-Format Food Retailing Memo: The 'Eco-Convenience' Hybrid Store Trend Continues to Emerge: 'Locali Conscious Convenience' to Open First Store].

The retailing entrepreneurs had originally planned to open the store in late fall of 2008. However in December, 2008 they decided to wait until the first of the year to open the market, which puts a major emphasis on selling natural, organic and locally-produced convenience-oriented food and grocery items across multiple categories, because they wanted to time the opening with the start of the new year. "A new year, a fresh start, a new, fresh concept," is how co-owner Melissa Rosen described the choice of a January, 2009 opening.

The small-format, eco-grocery and convenience market is only about 1,000 square feet. However the retailers are packing a wide-assortment of natural and organic products into the space. The market is designed to be super-convenient yet extremely "green" in terms of its design and approach to convenience retailing. It's a neighborhood convenience market, designed to serve local neighborhoods and to promote and sell locally-produced products, although it will sell some non-local items as well.

"Our goal is to build a chain similar to 7-11, but on a smaller, sustainable scale," Melissa Rosen says.

"We would like to bring our healthy, fun and delicious food and beverages, eco-friendly home and lifestyle products, and outstanding/reasonably priced organic, biodynamic and sustainable wines, beers and sake to a diverse array of communities across the country. Our stores will continue to built in an eco and energy efficient manner and will vary in interior only with regards to the reclaimed wood used in the build out. While it is Douglas Fir for our first Southern California store, other locations will be furnished with reclaimed version of their own native woods."

"While other environmentally friendly convenience store/fuel stations like The Green Spot Market are pursuing a wonderful concept of making convenience stories healthier by selling organic and natural foods, our concept is different. Instead of making convenience stores more healthy, we want to make a healthy and eco-friendly lifestyle more convenient to pursue," Rosen added in response to a question about what in our analysis is a small but growing trend towards eco-convenience stores, which we wrote about in our September 11, 2008 story.

"This begins with our offering of consumer compost recycling and reverse osmosis filtered water for reusable bottle fill up. No petroleum based plastic bottled water will be for sale in our store," Rosen says.

"It also includes selling practical and affordable eco-friendly household items and gadgets that aid in individual conservation. In an ideal world, it would be lovely if we could all sit down for a two hour slow food organic meal daily, but our daily realities are usually far different. Locali acknowledges and embraces the need for fast foods in our increasingly harried (and budget tightening) world. To that end, we will offer an array of pre-packed healthy meals from local food artisans and restaurants, unique glass bottled juices and beverages, and a small array of kitchen staples including organic rice milk, cage-free eggs, seasonal produce, grains, olive oils and more."

In addition, Melissa Rosen says Locali Conscious Convenience will offer vegan and dairy homestead cheeses, crackers and spreads, natural snacks (popcorn, chips, nutritional bars, trail mix, etc.) and a selection of fresh, prepared soups, deli salads and sandwiches, and other ready-to-eat prepared foods.

"In the mornings, we will serve high-fiber muffins, cold and hot cereals, toast, hard boiled eggs and gluten-free bagels and muffins. We will serve fair trade organic coffee and wild harvested yerba mate throughout the day. In terms of wine, beer and sake, we will favor domestic organic, sustainable and biodynamic brands. In terms of the microbrews, they will be altering seasonally and you will be able to create your own pack based on taste," Rosen says in describing additional merchandising aspects of the the hybrid, convenience-oriented eco-market.

Melissa Rosen says she plans to involve the store, and future stores, in a wide-variety of community-based activities. "Another aspect (of the retailer's plans) that will be interesting is to see the (community) response to the litany of community initiatives we are planning," she says. "We're planning to have regular workshops on wellness, environmental and sustainability concerns. Our vendor sponsors are extremely excited about these plans because it will offer them a greater connection to the consumer than say through "the sample lady route".

Tomorrow's opening of the Hollywood store will be a soft opening, Rosen says. The retailer's contractors are still completing some last minute touches to the store. However, according to Rosen, the owners wanted to get the store open with the soft opening despite these minor contractor completion issues because they are excited to kick the store off in the first month of the new year. The new year, fresh start, new store concept focus we mentioned earlier.

The husband and wife retailing team are working with commercial real estate giant Cushman & Wakefield in a strategic process in which they are lining up additional store sites, first in Southern California, for future Locali Conscious Convenience store locations. The main focus right now though is to get the Hollywood store up and running and to build the business there first. Rosen says. Plans call for both future company-owned stores, as well as franchising to independent owners, Rosen says.

"Strategically we are completely focused on the first store. But we are working with Cushman & Wakefield on expansion plans. Alisi Mataele of Cushman & Wakefield is our guardian angel. She found us the amazing and affordable location for our first store and she introduced us to Leslie Mayer, Executive Director of Retail Services at Cushman & Wakefield. They have been extremely generous with advice as we approach our opening on Franklin Avenue in Hollywood," Rosen says.

In developing its format and opening the first store tomorrow, Locali Conscious Convenience is building on a number of recent and current trends in food and grocery retailing. Those trends include more small-format stores, more hybridization between the conventional C-store and grocery store retailing formats ( more blending of the two), increased focus on neighborhood-oriented retailing, added retailer and consumer focus on locally-produced products and on shopping with retailers that offer such local products, the "green" movement, and a decade long trend towards more healthy natural and organic foods.

It will be key however for Locali Conscious Convenience to offer the food and grocery items, including the fresh, prepared foods offerings, it sells in its first store, as well as in future stores, at affordable prices. In this severe recession even committed natural foods consumers are trading down, looking for the value.

Shoppers will pay more in good times for convenience and "green" and healthy attributes and products. However, right now the premium most shoppers are willing to pay at stores that offer these attributes is a small one. If Locali Conscious Convenience can combine its innovation at the Hollywood store with offering affordable prices, which co-founder Melissa Rosen tells us is a key strategic focus for the retailer, we think its chances of succeeding are fairly high.

Additionally, the hybrid grocery-convenience eco-store concept should play well in Hollywood. The city's young and hip -- and in many cases "green" -- residents should form a solid base for Locali Conscious Convenience. The Hollywood Locali Conscious Convenience store opens tomorrow morning, according to Rosen. Since it is a soft opening tomorrow there won't be a grand opening celebration. However, plans call for one soon.

Store Address:
Locali Conscious Convenience
5825 Franklin Avenue
Los Angeles, CA 90068
310-779-3439

Website:
http://www.localiyours.com/

NSFM Reader Resource

Related stories from Natural~Specialty Foods Memo (NSFM):

~Small-Format Food Retailing Memo: The 'Eco-Convenience' Hybrid Store Trend Continues to Emerge: 'Locali Conscious Convenience' to Open First Store

~Retail Innovation Memo: The 'Econvenience Store' Will Be the Next New Thing, and is A Convenience Store Industry Green Retailing Trend in the Making

~Small-Format Food Retailing Memo: Savannah, Georgia USA's Parker's Convenience Stores: Taking Hybrid Convenience-Grocery Retailing to Upscale Heights

~Small-Format Food Retailing Memo: Giant Food Stores To Open its First Small-Format, Hybrid Convenience-Grocery Store: 'Giant To Go'

~Small-Format Grocery Retailing Memo: Stretching the Boundaries of Convenience Store Retailing; Some Say Japan's Natural Lawson is Awesome

Small-Format Food Retailing Memo: The 'Eco-Convenience' Hybrid Store Trend Continues to Emerge: 'Locali Conscious Convenience' to Open First Store

Small-Format Food Retailing Special Report

A new small-format, hybrid grocery and convenience-oriented store is coming to Hollywood, California. And the company hopes to create a regional chain of the stores throughout Southern California.

Locali Conscious Convenience, which is currently under construction, is set to open its doors this fall. The market, located at 5825 Franklin Avenue in Hollywood, seeks to make healthy eating and eco-friendly household necessities easily accessible to those on the go, says CEO Greg Horos. Roughly translated from Italian, locali means "community" or "where it's happening. "

According to CEO Horos, the small-format, environmentally-focused hybrid grocery and convenience market "will be a hip version of the mom and pop corner store. Locali will also be a place for people in the community to connect with each other and their food sources. There will be an emphasis on local and organic food artisans, producers and growers in the inventory line up. However, refined sugar, hydrogenated oils, high fructose corn syrup and genetically modified products will be missing from the shelves," he says.

"I like to describe it as the sustainable version of 7-11," Horos says. "We’ll have healthy and eco-friendly versions of the all the typical things you’d find at a convenience market…with the exception of cigarettes and lotto tickets…No clean versions of those," he added.

"We’re building (the store) to LEED (strict green building guidelines) standards and working with the city of Los Angeles to make sure we can supersede those standards as much as possible. We have a lot of terrific value adds for the community. I’m most excited that we’re offering exclusively organic and biodynamic wines and beers, too."

Besides the energy efficient building measures and appliances, Locali Conscious Convenience will also provide for the disposal of compost, in addition to recycling waste. A percentage of their proceeds will benefit a variety of local and international charities geared towards improving overall wellness, according to Melissa Rosen, a company spokesperson. The retail space is being designed by Los Angeles-based MASS Architecture & Design, Ms. Rosen says.

"Locali conveniently connects the community to eco-friendly food, beverage and lifestyle products. By providing easy access to socially and environmentally responsible goods, Locali promotes conscious consumerism and healthy living," Ms. Rosen says.

Locali Conscious Convenience is a unique hybrid concept, combining green retailing with small-format food and grocery retailing, natural and organic niche. However it's not the first or the only retail format of its kind in the U.S.

In June of this year we wrote and published this piece,"Retail Innovation Memo: The 'Econvenience Store' Will Be the Next New Thing, and is A Convenience Store Industry Green Retailing Trend in the Making," about Green Spot Market & Fuels, a hybrid small-format convenience and grocery store that opened in the Dallas, Texas region earlier this year.

In the story, Natural~Specialty Foods Memo predicted we would soon begin seeing other, similar format stores opening in the United States, calling the eco-hybrid convenience/grocery store an emerging trend.

Hybrid eco-convenience stores popping up all over

It appears we're on to something with that prediction. In addition to Texas' Green Spot and Los Angeles' soon to be Locali Conscious Convenience, we've learned a hybrid eco-convenience-grocery store chain named Good to Go ECOnvience Center recently opened its first store in Grand Chute, Wisconsin USA on May 1, 2008.

Good to Go, which like Green Spot and Locali Conscious Convenience also bills itself as "the first eco-convenience store in the U.S.," says it has plans to open 150 of the green convenience-oriented stores in Wisconsin, Iowa and Northern Illinois by the end of 2010, which is a very ambitious store opening program.

Good to Go says its stores also are built using LEED green building guidelines. The Good to Go ECOnvenience Center features a green roof with plants and sod that minimize absorption of sunlight that could heat the building and force overuse of its HVAC system; energy savings during the summer cooling season can be as much as 25 percent. The soil also acts like a sponge to absorb rain and reduce storm water runoff by as much as 95 percent after a one-inch downpour.

"When it comes to our customers, we haven't set out to change the direction the wind blows. Rather, we have adjusted our sails," said Angie Nikolas, vice president of neighborhood relations for the retailer. "We're very proud to bring 24-hour convenience that minimizes the impact we make on our environment.

"Similar to Green Spot and Locali Conscious Convenience (although each have unique aspects as well), Good to Go's focus is on selling healthier natural and organic food, grocery, beverage, snack and prepared foods items as part of its green theme.

In Portland, Oregon, a company called Full Moon Foodies is working on creating a chain of small-format hybrid convenience-grocery stores with a green and natural products focus.

"I got tired of having to hop into the car to drive to a mega-organic mart, fight for parking and waste time standing in long lines whenever I needed a few items," Ellisa Wee, the retailer's founder says.

According to the company, "the retail concept provides customers with a knowledgeable staff; a modern, upscale store design; multiple community-based urban locations; and extended hours past those of grocery stores."

"We're not trying to re-invent the convenience store or the organic/natural food concept, we're trying to make it more accessible," Wee says.

The Full Moon Foodie's aren't the only retailers looking to penetrate (or perhaps create) the eco-convenience grocery niche however. A company called SeQuential Biofuels, which operates numerous fuel stations throughout Oregon and Western Washington state, has created a natural convenience market, which it is locating on site at its many fueling stations. Those stations offer conventional gasoline, biofuels and other green technologies. Many of the eco-convenience stores are solar powered. The stores also buy used vegetable oil form businesses and consumers and then turn it into biofuel.

The small-format store, called the Natural Market, sells conventional, natural and organic snacks and beverages, along with a limited assortment of grocery items. It features fresh, prepared foods, along with fresh produce. The stores also sell beer and wine, putting a special emphasis on locally-produced brews and wines from the Pacific Northwest region where the stores are located.

All of the coffee cups and straws used for the store's fresh brewed organic coffee are 100% compostable. Additionally, the retailer says it picks each product to sell in the stores "based on where, how, when, and by whom it was made," "Every effort has been made to source local, organic products, a company spokesperson says.

Part of the small-format continuum

We see this emerging small-format eco-convenience hybrid grocery-convenience store retailing trend as a "kissing-cousin" to the small format food and grocery retailing revolution happening in the United States, as well as in Europe and Asia. The eco-convenience stores are a variant of what is a multi-format small-format food and grocery retailing trend if you will.

For example, while there are qualitative differences between Tesco's Fresh & Easy Neighborhood Market, which now has 86 stores in Southern California, Nevada and Arizona, and what these retailers are doing--chiefly that Fresh & Easy is putting more of an emphasis on being a primary shopping venue with a low price focus on selling basic groceries and prepared foods--there are numerous similarities as well.

For example, the Tesco Fresh & Easy format puts a major emphasis on healthy and natural foods, preparing its fresh, prepared foods without using artificial ingredients and colorings. Fresh & Easy stores also sell lots of natural and organic grocery products and are positioned as environmentally-friendly markets just like the hybrid eco-convenience stores are, along with offering craft beers and specialty wines like the hybrid eco-convenience-grocery stores are doing.

Therefore, we view this format development as a continuum of sorts, as well as a natural foods variant of the tradition C-store format just as in many ways the natural foods store is a variant of the traditional supermarket.

As part of this format continuum, you have small-format grocers like Trader Joe's with a specialty and natural products focus, and Safeway's "The Market" format which offers basic and specialty groceries in a more upscale environment on one end. In the middle you have Tesco's Fresh & Easy and the soon to open Wal-Mart Marketside, which are hybrid combination basic grocery stores and fresh foods markets. And at the other end you have the small-format, no frills stores like Aldi and SuperValu, Inc.'s Sav-A-Lot, which are deep or hard discount limited assortment grocery stores.

Sitting alongside these various small-formats on this continuum you have the traditional convenience store, the supermarket and the natural foods store. It's like taking a piece from each one; the sums becoming the whole (format).

You can add to this the new hybrid eco-convenience stores, which are combining the traditional C-store format with a mini combination grocery and natural foods store, while still including gasoline fueling stations which offer traditional petroleum-based gas but also are adding cleaner biofuels.

All of the formats are going after two things in the main: the time-pressed shopper who might be tired of shopping at big box stores, along with a share of that shopper's stomach. Each has a similar but different niche. But in one way or the other all are competing against one another for that share of the consumers' stomach, and in many cases her 21rst century "green" conscious as well.