A Loaf of Bread, a Quart of Milk and a Microwave

Hoping to steal business away from large discount retailers, some Ralphs supermarkets have begun offering whole aisles of products more commonly seen at Petco, Office Depot or Target.

Items such as microwave ovens, filing cabinets and gardening tools now occupy entire aisles at two newly opened Ralphs Marketplace stores in Redondo Beach and Lancaster. Both are remodeled Ralphs stores devoting roughly one-fifth of their space to merchandise not typically found in neighborhood supermarkets.

Another Ralphs, in Glendora, is scheduled to undergo a similar transformation by November, and 10 additional Marketplace stores are expected to open next year. Ralphs President Sam Duncan said that only stores big enough to incorporate the Marketplace format without squeezing out standard grocery offerings have been slated for the make-over.

The move is part of a larger trend by retailers nationwide to offer one-stop shopping at their stores, said Mark Husson, a retail industry analyst for Merrill Lynch & Co. in New York.

General merchandise giants Kmart and Wal-Mart, for example, now offer a full line of groceries at some of their stores, he said.

Duncan said the Ralphs Marketplace concept is not intended to compete head-to-head with the likes of Staples or Home Depot but merely to siphon off business from these and other so-called category killer retailers by offering some of their more popular items at similar prices.

Ralphs Marketplace stores should match or beat prices charged by the category killers, Duncan said, given the bulk wholesale discounts enjoyed by Ralphs’ parent company, Fred Meyer Inc. of Portland, Ore. Fred Meyer operates more than 100 stores similar to Ralphs Marketplace, only larger.

At the Ralphs Marketplace in Redondo Beach, some products, such as dog collars and envelopes, were cheaper than comparable items at a Petco and an Office Depot nearby. But both nationwide giants were able to undercut the new Ralphs on other items such as legal pads and pig-ear chew toys for dogs.

Prices aside, Duncan said the new format’s broader selection would help set Ralphs apart from its competitors, which stock far fewer nonfood items.

That could change if Ralphs Marketplace succeeds. Jack Brown, president of the Stater Bros. supermarket chain, said his and other grocery companies would be quick to copy the concept if it pays off.

“That’s just the way this business works,” he said.

But food retail analyst Husson said other chains like Vons and Lucky may not have the buying power to offer a selection of general merchandise comparable to that of Ralphs Marketplace at competitive prices.

“They don’t have a Fred Meyer-type parent company,” Husson said.

Other analysts wondered whether the new format would have much of an impact on overall revenue for the 312-store Ralphs chain. George Thompson, food retail analyst with Prudential Securities in New York, predicted most consumers wouldn’t think of going to a supermarket to buy such nonfood items as hardware or appliances.

“Is this really where I want to buy a microwave?” Thompson said. “Do they know anything about microwaves? Is the selection as broad?”

But Duncan said Ralphs Marketplace is not intended to be a top name in small appliances or the other general merchandise it carries.

“We’re not trying to change the customer’s shopping habits,” he said. “We’re making these items available so there is a choice to buy from us.”

Esperanza Sanchez of Torrance said she and her husband have made that choice at least three times since the Marketplace in Redondo Beach opened. The couple have purchased an electric can opener, a knife set and glassware.

“It’s convenient because you don’t have to go to any other store to get your kitchen aids,” Sanchez said.

Analyst Husson said that convenience should win over other shoppers as well, even if prices are higher than those at other retail stores.

“People shop at grocery stores more than any other kind of store,” Husson said. “If you do something in a grocery store, people are going to see it. If you can provide a convenience, people don’t care about having five different toasters to choose from. They only want to buy one.”