NEW YORK -- Raley's, a West Coast supermarket chain, is exploring the possibility of featuring an expanded bath category, something traditionally shunned by supermarkets.
Late last year, the Sacramento, Calif.-based chain created extensive bath and body shops in two of its 63 units. If they succeed, the boutiques will be installed in other stores, according to Bill Roatch, cosmetics buyer for Raley's.
He noted that it will be up to the manager of each unit to decide whether to enlarge bath space, and that no timetable has been set for possible expansion.
"We're watching the category. We want to make sure bath and body is a long-lasting trend," said Roatch. "If it is, we may even explore private label."
Raley's executives hope their bath endeavor is successful for one simple reason: profit. The supermarket chain recently scrutinized its beauty mix and deleted items that weren't producing sufficient gross margins and turns.
The retailer cut higher-priced cosmetics lines to concentrate on value-oriented brands such as Cover Girl, as well as to give space to the more profitable bath category, Roatch noted.
While traditional cosmetics products yield gross margins in the 30 to 35 percent range, Raley's is expecting to generate margins closer to 50 percent with its bath venture, he added.
Roatch is aware, however, that some competing retailers have been disappointed with turns in the bath category.
"We know that can be one of the drawbacks," he said, adding that the store will keep close track of turns.
He claimed, however, that Raley's will benefit from offering great value compared with the higher-priced bath items sold by specialty stores such as The Body Shop.
Last October, Raley's edited out slow-moving mass market fragrances in a store in Woodland, Calif., allowing room to build the chain's first enlarged bath boutique.
"We have the technology to know what is selling and what isn't, and we found we could cut back in men's and women's fragrances," said Roatch. The space was used to build a 20-foot-long bath shop.
For the installation, one of the Woodland unit's managers visited local vegetable growers to purchase tomato lugs. The containers are now used to house the bath items. He also got wood from a dilapidated barn to use as decorative fixtures, creating a rustic bathhouse look.
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