New Grocery Outlet opens in north Napa, offering local products

New Grocery Outlet opens in north Napa, offering local products

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Grocery Outlet Bargain Market opened the chain’s new north Napa location at 3385 Solano Ave. in Redwood Plaza, on May 21.

Patrick Gaul, the owner-operator of the new store as well as Grocery Outlet’s south Napa store at West Imola Avenue, said he looks forward to offering Napans healthy products in a clean, safe and friendly environment.

“We’re very excited to be here and serve the community. We will order as many local products as possible, including Napa wines, Napa grapeseed oil, and other local products as they are available. Our best sellers will likely be fresh organic produce, and natural, organic, specialty, and health products (NOSH products) and wines,” said Gaul.

He said the 35 staff members at the new store are focused on protecting both employees and customers during the pandemic.

“We’re socially distancing, making sure everyone on the employee side washes their hands. We’ve installed plastic face shields for checkers, and recommended customers wear face masks in the store,” said Gaul.

He said the store has been completely remodeled on the inside, with all new equipment and shelving.

“We’ve been engaged in construction in this store for the past three months, and had employees training here for the past two weeks,” said Gaul.

Drawing on experience

Gaul said the north Napa staff have been an important component in getting the store ready.

“They’ve provided a glimpse into what the neighborhood wants. We listened to them to order and stock items that they love,” said Gaul.

Gaul said he also determined what to stock by looking at patterns for the south Napa store.

“In addition, 15 experienced employees from the south Napa team are now changing workplaces to this store. We’ve hired between 30 and 35 new employees for both locations, all from Napa County,” said Gaul.

Grocery Outlet is contributing to the growing number of people in need of food assistance by working with local food agencies, Gaul said.

“Currently, we’re providing and sometimes donating food to Napa Valley Food Bank, Crosswalk Church and OLE Health. OLE Health receives produce from us,” said Gaul.

Gaul said the north Napa store is holding off on a grand opening celebration until the county health department releases guidelines advising such an event is safe.

“In June or July, if county guidelines allow, we look forward to having a celebration with specials and promotions,” said Gaul.

Currently, customers can get a $3 off coupon online for providing a new email to Grocery Outlet.

The new north Napa store is located in the old Vallergas building, a family-owned market that closed in March 2018. In a prior interview with the Napa Valley Register, Gaul said having two locations will allow Grocery Outlet to better serve customers “up and down the valley.”

Grocery Outlet, based in Emeryville, sells discount, overstocked, and close-out products from name brand and private label suppliers in six states:, California, Idaho, Nevada, Oregon, Pennsylvania, and Washington.

Napa store may contribute to record sales

Recently, coronavirus-related demand has caused Grocery Outlet’s sales to jump, with net sales for the quarter ending March 30 rising 25.4 percent. Sales are now $760.3 million, up from $606.3 million a year earlier, officials said.

The company expects a first-quarter net income of $8.8 million to $9.9 million, contrasted with $3.8 million in the prior-year period. Grocery Outlet has opened 32 new stores since March 2019, with a current total of over 350 stores, officials said.

Grocery Outlet is seeing continued sales growth during the second quarter. Although store traffic is lower than normal, customers are spending more per trip. Grocery Outlet plans to open new stores at a 10 percent annual unit growth rate, the same rate planned before the pandemic started.

Like many other grocery chains, Grocery Outlet has faced obstacles in buying high-velocity items such as toilet paper. The company is still purchasing high volumes of everyday products that allows it to meet heightened customer demand.

Grocery Outlet expects to pay substantial additional expenses because of the COVID-19 outbreak. These include higher costs for cleaning and safety, corporate and distribution center staff, and personal protective equipment and supplies at stores, its facilities, and its supply chain.

Grocery Outlet stated on its website that only a portion of these costs impacted its first-quarter preliminary results. It expects COVID-19-related expenses to more significantly burden its second-quarter financial results.

On March 19, Grocery Outlet borrowed $90 million under a revolving credit facility for reserve funding for working capital needs.

Eric Lindberg, CEO of Grocery Outlet, stated on the company’s website in late May that the chain’s strong first quarter performance “reflects the tremendous efforts of our corporate and independent operator teams, our suppliers, and other partner companies. While we continue to focus on our response to COVID-19, we are incorporating learnings to capture opportunities that we believe will arise as we emerge from this pandemic.”

You can reach reporter Jennifer Huffman at 256-2218 or jhuffman@napanews.com

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