Fresco y Más Banner Is Riding a Latino Wave of Growth
People in the grocery industry have been talking about the opportunity in catering to Latino consumers forever — or at least since the 1990s. Since then, the Hispanic population in the United States has tripled, from 22 million in 1990 to more than 60 million in 2019. Yet most conventional food retailers in the United States haven’t moved aggressively to leverage the Latino opportunity — until now.
Southeastern Grocers (SEG) is talking the talk and walking the walk when it comes to Hispanic grocery. The Jacksonville, Florida-based company just opened its 27th Latino-themed grocery store in Sunshine State in four years: a banner founded in 2016 called Fresco y Más.
While other large grocery chains, such as San Antonio-based H-E-B and Lakeland, Florida-based Publix Super Markets, have dabbled in Latino retail, Southeastern Grocers is the first major grocery chain to go all in on a format where malanga is the star of the produce department and tres leches cake is the star of the bakery. With the Hispanic population exploding not just in Florida but also across the United States, Fresco y Más has emerged as a secret growth weapon for SEG. Over the past year, Fresco stores have caught the attention of investors; Boston investment firm Longpoint bought a strip center in Miami anchored by a Fresco y Más this past August, citing “expected growth” in Hispanic grocery.
Yet Fresco stores, which average about 44,000 square feet, aim to appeal not just to Latino customers, but also to the broad diversity of demographics that seek out Hispanic foods: non-Latinos who are adventurous foodies, recently arrived Millennials from Colombia, third-generation Mexican-Americans who may not even speak Spanish, and Cubans who moved here from Spain, like Fresco y Más Director of Operations Sergio Benitez.
“We go far beyond just having a few Hispanic items,” says Benitez, who joined Southeastern Grocers in 1989 as a front end associate and went on to hold many roles with the company before becoming a store manager in 2001 and director at Fresco in 2018. “We want to have all of the quality products that our customers want most. The heart of Fresco y Más is Hispanic, and our base products at Fresco are similar in all stores, but we go the extra mile to localize each store based on the community that we serve. We cater to Hispanic customers, but we also provide a great shopping experience to meet everyone’s needs.”
Touring a Fresco store in Tampa, Florida, with Benitez is akin to taking a 30-minute journey around the world. When it comes to design and ambiance, Fresco differentiates with bold colors (mostly yellow and black), prominent displays of fresh produce, and fun music — all of which appeal to multicultural food shoppers.
The center store assortment at Fresco is Hispanic-focused, but there’s also Heinz Ketchup, Kraft Macaroni and Cheese, and Sunny Delight beverages. Benitez says that Fresco has dug deep into the data to carefully curate assortments tailored to the demographics in each individual neighborhood. This customized segmentation merchandising strategy is a key component of the banner’s success; another major factor is Fresco’s partnerships with local vendors, according to Benitez.
The Carniceria, or meat department, features specialty beef cuts such as palomilla, bola and falda. Customers can special-order a whole pig or buy freshly butchered rabbit. Bagged beans, jackfruit and root vegetables dominate the produce department. And in the Cocina, or kitchen, plumes of steam rise from hot mojo pork and fried plantains right next to the roast turkey and mashed potatoes.
“Whether it’s the produce department, the meat department, the deli, the bakery at Fresco y Más, they are all going to be authentic, because that’s what Hispanic customers know and want,” Benitez asserts. “But we also focus on value to provide our customers the best-quality products possible at a great value.”
Since, as Benitez observes, Hispanics eat 80% of their meals cooked at home, SEG is leveraging this knowledge by driving frequent trips and loyalty with targeted promotions, a Latino product-focused Dollar Zone and even cultural programming. The banner also offers grocery delivery via Birmingham, Alabama.-based Shipt, including delivery of prepared foods. Benitez says that the banner is looking into adding grocery pickup and experimenting with self-checkout at one store.
Over the decades, as the Hispanic population has grown, so has the demand for grocery stores that offer products for these shoppers. SEG is stepping in to fill that void. Of course, appealing to all of those demographics without alienating one group or another may be a challenge for Fresco y Más as well as other retailers. For now, though, SEG seems to have a winning formula.
