Kmart plans full groceries at four Alaska stores

Posted: Sunday, June 03, 2001

ANCHORAGE (AP) -- Grocery shoppers in the state's three biggest cities will have another option as Kmart Corp. this month begins adding full-line grocery departments at four of its five Alaska stores.

Kmart already has a small food selection, but the stores are being reconfigured to offer some 40,000 items. They will also have deli and seafood departments, as well as fresh produce and sushi, said spokeswoman Julie Fracker on Friday.

The two Kmarts in Anchorage and the Fairbanks and Juneau stores are getting groceries. They will stay open during the conversion, which should be finished by mid-October. A grocery department is not being added at the Kenai Kmart, she said.

Kmart's decision to expand into groceries is the latest change in the competition among grocers in Anchorage. In the mid-1990s, Fred Meyer expanded in Anchorage and added groceries to its stores there. In 1999, Safeway Corp. bought its biggest competitor, the homegrown Carr Gottstein Foods Co., which was the state's largest grocer.

In the wake of that $330 million takeover, a new chain, Alaska Marketplace, opened but died last December. Two specialty food stores have also expanded in Anchorage, and Fred Meyer is adding a fourth store.

Kmart's move is part of a trend nationwide to build ''supercenters'' that sell a wide array of groceries and general merchandise.

Kmart doesn't plan to add space to its stores, but rather to reconfigure them to make room for more groceries. Kmart said it won't close existing departments. The merchandise will just be reshuffled.

''The Alaska stores are really large compared to those in other states,'' Fracker said. ''Most of our Big Ks range from 84,000 to 120,000 square feet, but the Alaska stores are on average about 140,000 square feet.''

A big challenge to running a grocery chain in Alaska is keeping the stores stocked with fresh merchandise, much of which comes thousands of miles from the Lower 48. The question is whether Kmart will be up to the task, said Carrs Safeway's general manager Richard Near.

''I imagine distribution is going to be difficult for them, not having done it before in Alaska,'' he said.

Michigan-based Kmart is getting help with the distribution, Fracker said.

Kmart contracts with food wholesaler distributor Flemming, a Dallas-based company that recently cut a decade-long deal worth $4.5 billion annually to be Kmart's sole food supplier.

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