Several A&P supermarkets in the Washington suburbs are expected to be converted to limited-selection economy food stores under a new marketing strategy that will be announced today at the annual stockholders meeting in Charlotte, N.C.
Great Atlantic & Pacific Tea Co. executives this morning will reveal plans to open stores that carry less than 1,000 basic food items - only a fraction of the selection of conventional supermarkets.
The new A & P stores will be patterned after - and probably will carry the name of - the "Plus" stores operated in Europe by The Tengelmann Group, a German firm that earlier this year bought 42 percent of the stock in A & P.
Six A & P stores in the Virginia and Maryland suburbs will close their doors this weekend, and some of them reportedly will be converted later this year to the "Plus" store concept.
Officials of A & P confirmed the closing plans yesterday, but declined to comment on future use of the stores until after the annual meeting.
A & P employes and other food industry sources said they expect A & P to adopt a variation on what are known in the trade as "box stores."
Box stores get their name because many items are displayed right in their shipping boxes. The no-frills outlets concentrate on nonperishable items and carry little, if any, produce, meat or dairy products.
A & P last December opened its first of two experimental box stores in Florida under the name "Lo-Lo." The "Lo-Lo" units carry only 450 items and no meat, produce or dairy goods.
For its "Plus" stores, A & P reportedly is considering a less severely restricted assortment of goods than carried by "Lo-Lo," including some packaged meat and produce and a limited dairy department.
Tengelmann operates 800 "Plus" stores in Europe. The name is an acronym for the German phrase "prima leben and sparen," which translates into "live well and save."
The German company, which has a total of 2,000 stores on the Continent, earlier this year invested $75 million to buy 42 percent of the stock of A & P from heirs of A & P founder Huntington Hartford.
The purchase was challenged in a stockholder lawsuit filed this week, which charged Tengelmann and Hartford family representatives violated securities laws in arranging the sale. Among other charges, the lawsuit contends Tengelmann, kept secret plans to revamp A & P's management and operations.
Adoption of Tengelmann's "Plus" store name and concept would be the most dramatic evidence of the influence of A & P's new controlling shareholders.
Local officials of the chain confirmed yesterday that Saturday will be the final business day for six stores here.
Two of those closing are in Maryland, at 5452 Annapolis Road in Bladensburg and at 5750 Silver Hill Road in Suitland.
Four are in Virginia at 2725 S. Wakefield St. in Arlington, at 14440 Jefferson Davis Highway in Woodbridge, 10700 Lee Highway in Fairfax and 144 Branch Road SE in Vienna.
Most employes of the six stores have been offered jobs in other local A & P stores and few will be laid off, company officials said.
Closing the six units will reduce the number of A & P stores in the Washington market area from 42 to 36. The chain now has 23 stores in the Maryland suburbs, 18 in neighboring Virginia and one in the District of Columbia, at 48th and Yuma Streets NW.
Officially, A & P says the closings are routine and are the result of poor sales and inadequate profits in the six stores.
But unofficially, several sources said they expect some, if not all, of the six stores will reopen as limited-selection outlets later this year. All six of the stores are in neighborhoods where grocery business competition is strong and where an economy-priced box store would offer a distinct alternative to the dominant Safeway and Giant Food supermarkets.
A & P is the third largest supermarket chain in the Washington market, according to a study published last month by Food World, a regional trade newspaper.
The study estimated Giant has about 31 percent of the market, Safeway 27 percent and A & P 9 percent. Total supermarket sales in the area were estimated at $2.4 billion a year.
Nationally A & P is the second largest supermarket chain, with sales of $7.3 billion.