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Supermarket chief takes on competitors with positive thinking The Basic instinct


*TC So here's this middle-aged woman, minding her own business and doing her Monday morning grocery shopping when this well-dressed man bounds up to her and booms: "Good morning. Tell me, how much are bananas at Basics?"

For a second the woman looks puzzled, like she's wondering whether it's safe to talk with this guy. But he smiles his best game-show host smile, and she smiles back and trills, "29 cents!"

The dapper-looking man beams. "There, didn't I tell you?" he tells a visitor. At rival Giant, bananas are 59 cents a pound, the man and his visitor both know.

John Ryder, president and chief executive officer of Basics Food Centers, is making a point -- one of a never-ending stream of points he makes as he caroms around the store. And when Mr. Ryder counts up the points, the result is always the same: Basics is "simply the best."

It's far from the biggest, however. Last June, Food World, a Columbia-based trade publication, ranked the Basics chain as the No. 3 supermarket chain in the Baltimore metropolitan area with a 6.07 percent share of the market, representing $197 million in fiscal 1991 sales at 15 stores. That left it behind No. 2 SuperFresh's 7.30 percent share ($237 million) and about a light-year behind Giant Food's leading 29.11 percent ($946 million).

Since then, Basics has opened another Baltimore store and remodeled several others, bringing its total to 24 stores, including eight in the Washington suburbs. This year, Mr. Ryder promises that his chain, a division of Super Rite Corp. of Harrisburg, Pa., will vault into second place on the strength of "double-digit, compounded" sales growth.

Jeff Metzger, Food World's publisher, agrees that Basics is likely to move up when new ratings are published next month.

So what does Mr. Ryder do for an encore? His answer is as quick as it is brash: No. 1, of course. And he throws back his head and laughs.

As well he might. No one perceives Basics as even a remote threat to Giant's supremacy. It's highly unlikely that Giant Chairman Israel Cohen loses sleep over John Ryder.

But the Giant boss is constantly on Mr. Ryder's mind. When he talks about Giant, he doesn't refer to "it" or "they" -- it's always "he."

For instance, there's the matter of baby seats in shopping carts. "I had 'em before Giant," Mr. Ryder boasts. "He saw them in my shops and put them in his." Giant, which says it has been looking for the right baby seat since October 1990, denies that account.

Apart from his competitive drive, Mr. Ryder, who has headed Basics for about two years, is a man who flat-out loves to sell. Some people were born with register-tape ink in their blood, and he's one of them. His father was a supervisor in a supermarket, and young John started his retail career at 13.

"Retail is detail" could well be his mantra.

And forget about reaching him at the office. More often than not, a call to him will be patched through to the car phone that is his business lifeline.

His 1989 Cadillac's odometer registered 88,580 miles one day early last month. At his pace of 15 to 20 stores a week, it should be well over 90,000 today.

Those relentless road trips keep him in touch with employees and vendors. He seems to know them all by name -- not only employees but the delivery people who tend to the displays.

"It keeps my nose in the business and I can find out everything that's happening," Mr. Ryder says. "There aren't any registers in the office."

When Mr. Ryder sweeps through a grocery store, he's like the Energizer Bunny loaded with caffeine -- noting a flaw here, greeting an employee there, buttonholing a customer by the frozen foods.

"When he comes into a store, we put roller skates on," says Bart Dorn, manager of Basics' Middlesex store.

And all the while he's promoting -- his company, his employees, his ideas, himself.

If he weren't so obviously having fun, it could be grating, but Mr. Ryder's pride is sincere. When he points out the little ideas he got from a customer and put in his stores -- such as the easily detached produce bags that do away with cumbersome rollers -- he's as excited as a 7-year-old boy going to his first Orioles game.

"He gives you that kind of smothering approach," says Mr. Metzger, the Food World publisher. "He's not doing it to smoke you."

A tour of Basics' new-format stores is a revelation.

Mr. Ryder boasts that "Basics is not basic any more." And it's true. Except in certain specialty areas such as seafood, its product selection is comparable to Giant's and sometimes even more extensive. For instance, a spot check of the Basics on Liberty Road and the nearby Giant on Milford Mill Road found Basics ahead in the mustard count by 35 to 29.

Basics' once-dingy look is now a thing of the past.

The stores are bright, and the chain's use of color in displays of produce and other products may be the best in this market. Above all, the stores look clean.

"They used to have more funny smells," Mr. Metzger says. "They've cleaned that up."

The chain's new store on Fort Avenue in South Baltimore "is probably the most modern store operating in the city today," Mr. Metzger says.

Prices are more difficult to compare because of the influence of sales promotions, such as Giant's half-price program, and because Giant's prices vary from store to store. Basics maintains the same prices at all Baltimore-area stores.

Still, at Basics you don't get the hands-on help in loading your car that you get at Giant.

While Giant tends to study developments in the grocery industry before implementing them, Mr. Ryder is quick to jump on the latest technological innovation or marketing ploy.

He boasts that Basics has the most advanced electronic space allocation program in the Baltimore/Washington market, referring to a computerized system that "stocks" every shelf from a computer screen at the company's Randallstown headquarters.

Mr. Ryder is also in the vanguard of grocers in this region in accepting debit and credit cards at checkout -- a trend Giant is approaching very gingerly.

And Basics is apparently the first grocery chain in the country to open part of the back room for warehouse-style sales.

Basics' innovative approach even extends to toddlers. In some stores, it provides miniature grocery carts that let children as young as 2 1/2 shop like Mommy or Daddy. Some parents whose kids have used the carts report that it's difficult to go back to their old grocery store after that heady experience.

Mr. Metzger gives Mr. Ryder credit for bringing a higher level of professionalism to Basics. "He's made the job distinctions clear. He's a good motivator. That whole inconsistency that existed for years is pretty well gone."

At times, Mr. Ryder's motivation and self-promotion go hand in hand. Store managers who perform well can earn "Ryder bucks" -- with a picture of you-know-who on the front. Those who accumulate the most win such awards as a family trip to Walt Disney World.

"What we're trying to do is fill the air with positiveness," Mr. Ryder preaches. "Work should be fun."

Basics is a union shop, but Mr. Ryder says he has open communication with the United Food and Commercial Workers local that represents his employees. "The union is to help both. It's like a middleman for the employees."

Richard Eventoff, collective bargaining director for Local 27, is equally complimentary.

"It's been a good relationship," Mr. Eventoff says. "John's been fine to deal with."

Innovation and good labor relations notwithstanding, professional observers are skeptical about whether the chain can ever come close to Giant's market share, which the Landover-based chain protects fiercely whenever it senses a threat.

"You've got to be realistic when the guy who's No. 1 is 20-plus points ahead of you," Mr. Metzger says, noting that Giant's sales per store were $22.3 million in the last rankings, compared with $13.8 million at Basics.

Even Basics' jump to the No. 2 position in the Baltimore market is more a result of weak competition than strong gains in market share, he says.

According to Mr. Metzger, Basics must overcome some formidable obstacles before it can make any significant gains in market share.

One problem, he says, is that Basics hasn't really defined its market niche. Is price its main selling point or its new upscale look? Does it offer a complete selection or just the basics, as the name implies?

In addition, Basics is not even a player in some important areas, notably Howard County.

There are also lingering doubts about how much money Super Rite, primarily a wholesaler, will devote to expanding its retail division.

Mr. Ryder said Basics will add two stores before the end of 1992 and will expand at a rate of three or four stores a year over the next couple of years.

At that rate, Basics would need a long time to catch Giant, which will soon open its 43rd store in the Baltimore area alone.

Meanwhile, Basics has been having some difficulty extricating itself from the Washington market, where its presence has been too weak to give it much bang for its advertising buck. Last year, it made a deal to sell seven Washington-area stores to Shoppers Food Warehouse, but the sales of only two went through. With five fewer stores, its 3.72 percent market share will surely sink even further.

If taking on Giant weren't enough of a challenge, Mr. Ryder is laying plans for an entirely new concept of Super Rite grocery store -- not a Basics -- that will open at Perring Plaza in Northeast Baltimore late this year.

Details of the unnamed "Project X" won't be announced until July, he says, dangling his secret with glee. The only clues: It won't be a warehouse store and it won't replace Basics, not even the one across the street.

At 44, Mr. Ryder is having the time of his life. He has a company to grow, technologies to discover and aisle after aisle to roam. And above all, there's Giant's "Izzy" Cohen -- half rival, half role model -- and the sheer fun of competing with him.

"It's not only a job," John Ryder says. "It's a sport. It's a game."

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