New FMI Report: Most Profitable Independents Invest the Most in Employees; Study Benchmarks Financial Performance, Productivity, Inventory Management

WASHINGTON, DC — December 13, 2002 — The 25 percent most profitable conventional supermarkets owned by independents — median pre-tax earnings of 8.2 percent of sales — pay the highest wages and benefits at 13.6 percent, according to the Operating Results of Independent Supermarkets, 2001-2002, released here today by the Food Marketing Institute (FMI).

Their investment in employees is reflected in the percentage of sales for high-service departments, such as meat (14.5 percent of total store sales), produce (12.3 percent) and delis (7.1 percent) — together accounting for 33.9 percent of sales. Such departmental sales for the 25 percent least profitable stores totaled 29.9 percent.

“These figures illustrate the two hallmarks of independent operators: customer service and high-quality perishables,” said Michael Sansolo, president of the FMI Independent Operators Division. “Many of the most successful ones use perishables to establish a niche and company brand — a most effective strategy to succeed in today’s relentlessly competitive marketplace.”

“This report is designed to serve as benchmarking tool for independent retailers,” said Sansolo. It includes sales data, productivity measures, use of space, inventory management and department information such as inventory turns and percentage of total store sales. The companies that supplied information for the report receive a complimentary Store Performance Report with their own data printed alongside industry averages.

This FMI report offers the most current financial information on the independent sector of the food industry. It focuses mostly on the most common format used by independents: the conventional supermarket, defined as a self-service store offering a full line of groceries, measuring less than 30,000 square feet and grossing $2 million or more per year. Also included are some data for smaller grocery stores and superstores.

To purchase a copy of Operating Results of Independent Supermarkets, 2001-2002, ($30 for FMI members, $63 for associate members and $75 for nonmembers) or for more information, contact FMI Publications and Video Sales (tel 202-220-0723; fax 202-220-0879; e-mail publications@fmi.org) or visit the FMI Web site at www.fmi.org.