December 13, 2008

Store brands boost grocery stores

Chains such as Trader Joe's and Kroger say their store-brand labels are helping them through the dreary economic downturn.

Trader Joe's, Kroger, Safeway and Wegmans all have expanded their store-brand products, which tend to be cheaper than national brands and more profitable for grocers, The New York Times reported Saturday.

Kroger, for example, has added three-minute microwavable pizzas Mediterranean-style pizzas as an easy meal for children to make themselves, said Linda Severin, Kroger vice president for corporate brands.

This is a good example where we didn't knock off the national brand, but we thought, 'How can we deliver what our customers are looking for?' Severin said.

Cash-short customers eating out less and stocking up more at the grocery store often find store-brand products better than expected and may stay with them after the recession ends, said Jan-Benedict E. M. Steenkamp, marketing professor at the University of North Carolina, Chapel Hill.