Eclectic grocer Trader Joe's will open in Green Hills this morning, triggering increased competition among nearby grocery stores in one of the city's wealthiest neighborhoods.
Monrovia, Calif.-based Trader Joe's, known for private-label brands that range from tomato chutney to orange chicken, will attract shoppers looking for gourmet food items on a budget, analysts said. The store will open at 9 a.m. at 3909 Hillsboro Pike, in what had been a Wild Oats Natural Marketplace location.
The 14,000-square-foot outlet will sell products from fresh produce and frozen foods to prepared foods. Eighty percent of the items are store brands. Trader Joe's has a high percentage of private label foods, working directly with manufacturers, the company said.
"Trader Joe's will serve as a good trade-down from Whole Foods," said Darren Tristano, executive vice president of Chicago-based food industry research firm Technomic Inc. "The current state of the economy probably plays in favor of Trader Joe's and will create an opportunity for those who can't spend as much at Whole Foods."
Whole Foods entered the Nashville market a year ago and has a store in the Hill Center at Green Hills a stone's throw from Trader Joe's along Hillsboro Pike.
Stiffer grocery competition is coming to Nashville even as food costs remain stubbornly high here. The price tag for a basket of 16 grocery items — from boneless chicken breasts to cookies — increased 1.6 percent in the past three months, based on a survey of stores by The Tennessean this week. Results were compared with an identical survey the first week in August.
Consumers such as 29-year-old Amanda Smith said higher prices on meats have pushed her to try store brands to save money when she shops. Smith said she plans to visit Trader Joe's this week and "look for the best-priced stuff."
Other grocery stores may also be at risk when Trader Joe's opens, analysts said. In the Nashville metropolitan area, Kroger has the biggest market share, at about 41 percent, followed by Wal-Mart Supercenters, at about 29 percent, according to The Shelby Report, a Gainesville, Ga.-based grocery trade publication.
Matthew Leiser, 35, said he might shop less frequently at Whole Foods and Kroger supermarkets because of Trader Joe's pricing and his familiarity with the store. Leiser said he visited Trader Joe's in Chicago and enjoyed shopping there. Leiser lives in Green Hills and works as general manager of Hickory Hollow Mall.
Whole Foods' Regional President Scott Allshouse declined to comment on Trader Joe's but said customers in Nashville would understand the difference between his store's commitment to organic and fresh-made products. Trader Joe's has about 20 percent organic and natural products in its stores, a spokeswoman there said.
"We effectively compete against Trader Joe's in markets throughout the country," Allshouse said. "We think customers will recognize the difference and that helps us effectively compete against them."
Kroger spokeswoman Melissa Eads said: "It's business as usual for us. We're used to facing new competition and this is no different."
No wine on the shelfDon't expect the new Green Hills store to sell Trader Joe's popular low-cost wines — dubbed "Two Buck Chuck" — at its Green Hills location. It would run afoul of state alcoholic beverage rules.
"At this time there are no plans to open a wine shop, but things can change," said Trader Joe's spokeswoman Alison Mochizuki, who declined to elaborate. Mochizuki declined to state how much of the grocery chain's total sales come from wine sales nationally. She said the company has some stores in the Boston area where no wine or spirits are sold.
Still, 44-year-old Heather Klausner of Franklin is excited about Trader Joe's grand opening. Klausner will drive an RV to the Trader Joe's parking lot on Friday morning and host a party in the parking lot for her friends who are unfamiliar with the brand.
Klausner said she has driven several hours to Atlanta to stock up on items at a Trader Joe's there, even bringing coolers to store frozen fish. "To be able to just drive up the road from Franklin is exciting," she said.
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