Since filing for bankruptcy protection in 2005, Winn-Dixie has gone through numerous changes to repair its tarnished image and balance sheets.  Two recent store developments this year marked a transformational period for the grocery retailer:
  • In August 2011, Winn-Dixie announced that it will convert all SaveRite-branded grocery stores to conventional Winn-Dixie-branded stores and discontinue the SaveRite banner.
  • Earier this year, the company opened a new store in Florida, its home state, which was its first since 2004. The Winn-Dixie in Margate, FL is the second to feature the company’s new prototype design, emphasizing fresh and prepared foods, and is located in a building that previously housed a Publix supermarket.
This new store prototype is the beginning of a $100 million renovation project to more than half of its stores into ‘Transformational’ models to remain competitive. Florida’s ultra-competitive grocery market is also home to Publix, which remains king, as well as Delhaize-owned Sweetbay. Walmart has a large presence of Supercenters and Sam’s Clubs in the Sunshine State, while Whole Foods and the Fresh Market also compete heavily.  Even Target’s supercenters in FL have incorporated more grocery offerings, utilizing the company’s ‘P-Fresh’ concept. 
This isn’t the first time Winn Dixie has tried to freshen up its stores. Its first step out of bankruptcy was renovating over 230 locations with new equipment and an ‘overall refresh.’ However, this project appears to be much more than a fresh coat of paint on the buildings. Trendy features such as Wi-Fi, a sushi bar, and chef’s prepared on-the-go hot dinners will appear at a newly renovated location in Sarasota, FL.
For years, becoming a low-price leader was the company’s goal, and it even resonated in the tagline at various time periods. Buy-one-get-one-free promotional offerings flooded the weekly circular, and sometimes get two frees were offered in the meat department. But Publix also engaged in heavy promotional pricing, and Walmart continued to gain income-strapped customers.  This left Winn-Dixie somewhere in the middle and it has showed in yearly performance.  Sales for the most recently end fiscal year 6-30-2011 were down to $6.8 billion, a decline from its fiscal 2009 total of $7.3 billion.
Winn-Dixie’s new initiative to transform its stores into shopping experiences that will rival the likes of Publix and Whole Foods is an effort to change consumer perception on the once bankrupt grocery chain.  Coupled with its popular gas rewards program, which gives frequent shoppers incentives at participating stations, it’s undoubtedly the biggest step taken to finally repair its image and thrive in the Southeastern market.  No easy task, however, as Publix, Sweetbay and Walmart aren’t staying idle, updating their stores to more modern, luxurious style, and focusing more on higher-tier foods.

So will Winn Dixie’s expensive and ambitious program pay off? Initial results from the first transformed stores have been encouraging, with company officials stating weekly sales at remodeled stores are up about 10 percent.  With the ‘Transformational’ overhaul expected to take place at least 60 percent of Winn Dixie’s store fleet, management appears to be optimistic. 

Brian List, Research Editor 
Brian has been with Chain Store Guide since December 2006. He holds a bachelors degree in Marketing Management from Florida Southern College. Please contact him if you have questions or comments.