Smith's exec meets local retailers on development

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Trinity Site > Gilford addresses concerns of businesses

By Arin McKenna

In the lead-up to council’s approval of the Trinity Site contract, one hotly debated issue was whether having a Smith’s Marketplace as the anchor store would prove to be a benefit for local retailers or drive them out of business.

Those fears intensified when the North American Development Group backed out and Smith’s/Kroger assumed the contract.

As Smith’s/Kroger officials prepare to present design plans for county approval, it is working to alleviate those fears. To that end, Vice President of Public Affairs Marsha Gilford met last Wednesday with those who could be most impacted by the development.

“Our approach, and our true philosophy, is that there is so much business that’s leaking out to Santa Fe and Albuquerque that this store will keep a lot of that business and retail shopping activity in Los Alamos. And if we can do that, then all the smaller businesses are going to thrive as well,” Gilford said.

“We don’t expect that we’re going to have everything that people need and want. We think we’ll have a great selection and we intend to make this just an exciting store for the Los Alamos customers. We have a lot committed to this store and want it to be fabulous.

“On the other hand, we want everybody to thrive in the community as well, because that makes a healthy community. We think there will be plenty of business for everybody.”

Metzger’s General Manager David Jolly reacted positively to the meeting.

“I was really appreciative that the people from Smith’s were willing to sit down with us and just talk a little bit about their project and not keep from us what’s going on,” Jolly said. “Because there were several of us businesses in town that were really supportive and it’s good to know that they’re giving that back to us by being open about what their plans are.”

Los Alamos Cooperative Market General Manager Steve Watts expressed guarded optimism. Despite an obvious hesitancy to trust a public relations person, Watts did characterize Gilford as “forthright, forthcoming and articulate in what she wanted to get across, and I think that came across as sincere.”

“She started her conversation by saying that Smith’s intention is not to be predatory, which to me has a specific meaning, especially in retail businesses,” Watts said. “So that statement, if it’s true, is positive; and it always depends on their definition and my definition of what predatory means. But I still felt that it was important and significant that she said that.”

Pet Pangaea Owner Cindy Wells said that the meeting served to confirm her fears.

“I’m trying to keep an open mind, but I’m not hopeful that this is going to fulfill the original vision of helping fill some of those gaps and keep some of the leakage on the Hill, and I don’t think local businesses are going to benefit at all. I think it’s going to be detrimental to quite a few,” Wells said.

To help retailers “anticipate how best to compete with us,” Gilford brought preliminary conceptual plans showing how much square footage would be devoted to various types of merchandise.

“That gave me good information about understanding my competitor, and that to me was very telling.” Watts said. “Now, it’s nothing that I could not learn from going there on the first day of the store being open, and certainly would probably have been what I would have guessed anyway just through looking at other Smith’s Marketplace formats.

“But it would have been a little more difficult, a little more costly to obtain that information. So I felt like that was a service to me. It saved me time and resources. It did give me a good indication of what kind of competitive impact it might have on my business.”

Jolly was unsurprised by much of what he saw. He anticipates downsizing departments such as housewares and having more room to carry other items customers have requested.

“We’re going to be making some adjustments as they open up, but we think the net result is going to benefit the town. At the same time, we’re taking a little bit of a risk, because it’s big new competition. So we’re acting on a little bit of faith there,” Jolly said.

“But we think some of the things that we hope to have in the new store are going to save some of those trips off the hill, that’s going to make the residents up here happy and it’s going to keep them up here to shop in our store instead.”

Wells, on the other hand, felt that many of the products Smith’s is proposing to offer are already stocked by local retailers and that “gaps” such as electronics merchandise still are not being addressed. She was concerned about an eightfold expansion of Smith’s pet supplies, competition with CB Fox and a larger natural foods department.

Watts seemed less concerned about that expansion than about other issues.

“We currently compete on quite a few items, and I think we compete quite well,” Watts said. “However, our business model is not necessarily about wide selection at deeply discounted prices. Our product that we sell really is customer service.

“We have our finger on the pulse of what our community needs and desires in a natural and organic food store, and we are focused on delivering that with the highest level of customer service. So we really feel like that’s our product and that is our competitive advantage, and that is hard for competitors to compete against, especially large box stores.”

“We’re concerned that once Mari Mac is vacated by Smith’s that two things are going to happen. One, it’s going to look very substandard next to a new state-of-the-art facility and will be a blight; and two, it means that we have a majority of retail space available in the county that’s owned by one company,” Watts continued.

Watts was especially concerned that Smith’s non-compete clause would prevent local businesses from renting space in either center.

“I think that’s an issue, and it hasn’t been talked about, and I think it’s going to be more impacting than people realize,” Watts said.

Wells expressed similar concerns. She has been negotiating for space at the Trinity Site since the Boyer Company proposal.

“I haven’t gotten anything in writing, even an email confirmation that Kroger development is going to negotiate with me,” Wells said.

Los Alamos Chamber of Commerce Member Services Coordinator Katy Korkos had a different take on what she heard.

“What the Smith’s representatives told us was that the real estate part of who they would lease to is not written in stone yet,” Korkos said. “They don’t have a contract with the county yet, they don’t know what it’s going to cost to get people in there, and so they can’t really move forward with writing leases until they know how much it’s going to cost them to improve the property.”

Smith’s presents its plans to the Inter Departmental Review Committee Feb. 7 and the Planning and Zoning Commission Feb. 27.