Gigante USA Eyes Hispanic Shoppers in U.S.

SANTA ANA, Calif. - Mexican supermarket chain Gigante is setting its sights on becoming the supermarket of choice for Latino customers in the United States, according to a report by The Orange County Register.

Gigante USA is backed by a $3 billion Mexican corporation, Grupo Gigante, that has targeted the Mexican middle class.

The company made headlines this summer when the Anaheim Planning Commission denied Gigante's request for a liquor license for a new store in Anaheim Plaza. The City Council reversed the commission's decision, but not before a letter from city staff was revealed publicly that said the chain catered too much to Hispanics to be a good fit for Anaheim Plaza.

While Gigante has only three stores in the United States, Grupo Gigante, a public company, ended last year with 268 grocery stores and markets, 41 restaurants, 63 Office Depots and 63 Radio Shacks.

Justo Frias, president of Gigante USA Inc., told the Orange County Register that the company wants to continue to grow. "We're a public company in Mexico; we're here to grow. But it's got to be logical growth. It's got to make economic sense because, at they end of the day, I believe what we are is a price-impact store. Which means our prices, I absolutely guarantee you, are going to be cheaper than the major chains. So my expenses have got to be less than major chains (or) I'm not going to make money," he said.

Gigante moved into the U.S. market in 1999 when the company opened its first store, in Pico Rivera, Calif. In September, Gigante USA will open its fourth, in Santa Fe Springs, with two more to follow in south-central Los Angeles this winter. The 47,000-square-foot Anaheim location should open by March. Gigante is also scouting Stanton, and is in escrow on Fontana and Inglewood sites. Frias said the chain plans to have 10 stores in about a year.

When asked who Gigante's competitors are, Frias said, "It's the Food 4 Lesses of the world, the Northgate's in Orange County, the Vallartas in the Valley, the Superiors in L.A., they are all local chains that do a fantastic job of serving the Latino cliente."

But he added that right now he's more worried about Wal-Mart. "We believe that it's going to affect us, no doubt about it. But we will keep focusing on our perishable department, on our service meats, on our seafood, etc. We believe it's our forte, and that's a good tool to have against Wal-Mart," he said.
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