Woodman’s Makes a Big Entrance in Milwaukee
Consumers have been asking for a Woodman’s in the Milwaukee market and now they have a 225,000-square-foot megastore in Oak Creek to keep them happy.
Visitors to the new Woodman’s will find that just like the company’s other stores, this one is short on visual merchandising frills but very big on savings.
As a Milwaukee Journal Sentinel piece points out, half of every Woodman’s is warehouse with each of the company’s stores acting as a distribution center for a given category. The store in Appleton, Wisc., for example, distributes cereal to Woodman’s 13 stores.
Woodman’s is totally focused on keeping costs down by eschewing many eye-appealing merchandising elements. For example, fruits and vegetables are simply laid out in their corrugated cartons, as opposed to being neatly stacked on display tables.
The company also keeps costs low by focusing on self-service. There are no full-service bakeries or delis in its stores. The meat counter is used to slice lunch meat and/or cheese.
While the presentation is simple, Woodman’s uses its size to offer a wide range of products not found in many conventional grocery store competitors. A case in point is the 15,000-square-foot liquor department that is stocked with a great selection of wine and beer from around the globe.
Phil Woodman, president of Woodman’s, told the Journal Sentinel, “If there’s a beer for sale, we have it.” At the time, Mr. Woodman, was standing in front of a 96-foot wall of microbrews.
Big stores generate large revenue numbers for Woodman’s. At the end of 2007, estimates put the chain’s sales at $1 billion. As a point of comparison, Wisconsin’s largest supermarket chain, Roundy’s, generated sales of roughly $4 billion at 153 stores.
While Woodman’s has enjoyed great success, the company tempers its growth prospects by only building when it has enough cash on hand to finance construction and support the store. In the past, the company has opened stores at a rate of one every two-and-a-half years.
David Livingston, principal with DJL Research and a member of the RetailWire BrainTrust, said, “They’re going to do real well.”
Mr. Livingston estimated that Woodman’s will grab a three percent share of market with every store it opens in the Milwaukee area. If it opens three stores, it will move into second position behind Roundy’s in the market, he predicted.
Discussion Questions: What is your assessment of Woodman’s? What does its presence mean for the other retailers in markets where it opens stores? With stores now in Wisconsin and Illinois, where do you see Woodman’s looking for future stores and growth?