Owner of Compare Foods on Avondale Drive eyes expansion

Jan. 15, 2013 @ 09:13 PM

Eligio Peña Jr., the 32-year-old son of the founder of the Compare Foods Supermarkets franchise and the manager of the store on Avondale Drive in Durham, said a grocery store is defined not justy by the products that it has.

It’s also defined by the products it doesn’t have, Peña said. And he defined Compare Foods, which is now a franchise operation that started as a store in New York in 1989, as “regular grocery stores” that have a heavy ethnic food influence.

The approximately 55,000-square-foot location on Avondale has hundreds of feet of products that cater to Latino customers, he said, as well as African and Asian products.

The store was stocked on Monday with produce ranging from tomatoes to green and yellow plantains to papaya, and a range of different types of peppers.

The seafood section included baby octopus, shrimp for ceviche and tilapia. The meat section had goat, beef tongue, chorizo, salted pig feet and chicken wings. The menu for the hot food bar included tamales and empanadas.

 “We don’t want to be branded as a niche store because I think the local American community is very satisfied with the store - it’s a regular grocery store with a heavy ethnic influence,” Peña said. “We have a good variety of African products, have Jamaican products, (we have) Asian products. I wouldn’t say we cater to the Latino market; we cater to the local community,” he added.

The Avondale location is the sole store owned by Eligio Peña, the founder of the franchise operation who came to the United States from the Dominican Republic in 1970 at the age of 19. That was following a revolution in the country when he said government leadership saw “every young person as a problem.”

Eligio Peña Jr. said his father got his start in grocery stores as an employee at a small convenience store. His father said he started because he needed a job, and found he loved people. When the convenience store owner wanted to get out of the business, he sold it to his father, who would go on to sell the store himself, and buy another.

“That was his first opportunity of ownership of a business,” Eligio Peña Jr. said. “It snowballed from there,” he added.

Peña said his father later brought family members into the business. According to the website http://comparesupermarkets.com/about-us, the Peña family had its first supermarket in 1978, and they could expand with other locations.

Eligio Peña had a vision for a supermarket chain that would carry high-quality products at low cost. The first Compare Foods opened in 1989.

There are now 26 Compare Foods stores in North Carolina, Eligio Peña Jr., said as well as stores in New York, Massachusetts and Connecticut.

The first location in North Carolina opened in Zebulon in 2000. They were looking at opening additional locations in other states at that time, Peña said.

 “The demographics, the population density, the cost of operating the business, which would be the (most) susceptible to competition – taking all of those factors into account, North Carolina had the most promise,” he said.

He said they’ve looked to expand in areas with a concentrated Latino population where they would have low levels of competition.

While many items sold in the store can be found in smaller markets that cater to Latino customers, Peña said Compare Foods’ size offers an advantage.

The store buys in larger volumes, which allows them to offer competitive pricing, he said. Customers can get all of the items on their shopping list in one spot.

“Our customer doesn’t want to have to go (to) three to four locations to get the complete grocery list,” Peña said. “And aside from the fact that because we have a sizable location, we have very high turnover in our products – they’re pretty fresh.”

He also said that in comparison to large grocery store chains, the store can offer more competitive pricing on certain items.

He said that in some of the meats and produce they sell, larger chain stores are not competitors, although he said they do compete on items such as dry goods.

“We may not be as big as a company, (but) in our niche market, we’re pretty strong,” he said.

Peña also said their front-end staff is bilingual, and their produce and their products and some other items are labeled in both Spanish and English.

The chain is operated as a franchise, he said, with some locations owned by other family members. The other store in Durham on University Drive is under different ownership from the one on Avondale.

Peña said the plan is to use the Avondale store to be able to expand. He said they want to grow the business by retaining ownership of the location, and using its income for expansion.

“For being an independent store, it’s a relatively high-volume store,” he said.

He said they’re in early negotiations for a possible expansion location in Durham on North Miami Boulevard. That space previously housed a Lowes Foods.

Debbie Williams, executive assistant to the president at Lowes Foods, said the location, which first opened in 1988, was the only store in Durham for the grocery chain. It closed in September, she said, as the lease was coming up, Williams said, and store officials believed they would be unable to present full product variety and services there.

“Basically the rising cost of business, coupled with the future sales potential at that store, really made it impossible to commit to another long-term lease,” she said.

Peña said that they may not get the location. But he said they believe it would be a very promising one. Peña said they look at census and school enrollment data as well as other information to research new locations.

“We don’t make new stores, we take existing stores and change them,” Peña said. “We generally go into areas where the demographics have changed, and maybe the current customer base wasn’t in-line with the grocery store’s business model.”