Smart & Final Stores said initiatives focused on getting business customers to buy more per visit have helped boost sales at stores where the programs are in place.
Speaking with analysts Tuesday, Dave Hirz, president and CEO of the Los Angeles-based non-membership warehouse chain, said the company has doubled its advertising budget at Smart & Final Extra stores opened in the last few months “to help build traction with local small businesses.”
The result, he said, is that sales to business customers at four new stores opened so far this year were 25% higher in the first five weeks after opening than they were during the first five weeks at 13 new stores opened last year.
Business customers account for 45% of the company’s sales, Hirz noted.
The company has also boosted sales by moving produce and meat to the front of its stores, he said. “We’ve seen a 9% to 10% increase in produce sales at the first seven stores with perishables up front, and we will add 10 more stores this year to see if we can continue that kind of increase,” he said.

He also said employing perishable specialists at some stores to help business customers has had positive results, with plans to boost the specialists from 26 stores last year to 30 more this year.
Smart & Final is also expanding its “Buy More/Save More” program to incentivize more case volume sales to businesses by expanding its offering by 20% to 1,200 items, Hirz said.
Hirz made his comments during a conference call to discuss financial results for the 12-week first quarter ended March 22, which saw net income climb 95% to $4.9 million. As previously announced, sales rose 11.9% to $822.2 million, with comparable store sales up 6.1%.
He said comp sales decelerated as the quarter progressed due to declining inflation in proteins, noting that the level of inflation for proteins was 4% last year but is likely to fall into the 1% to 2% range this year.
During the call Hirz said home delivery sales from a pilot test with Google are running at $140,000 per week.
The company is also conducting its own home delivery pilot at 10 stores, with deliveries up 45% during the first quarter, Hirz said, though he did not give a dollar amount. He said sales are profitable, “but we are not yet ready to expand the program.”