The county’s Asian supermarket sector, led by Buena Park-based Tawa Supermarkets Inc. and its 99 Ranch stores, is getting a big new player.
A 25,000-square-foot H Mart, owned by Woodside, N.Y.-based Hanahreum Group, is set to open by year’s end at a shopping center going up on Jamboree Road in Irvine.
H Mart has 22 stores, mostly on the East Coast, in the Midwest and in Canada. The chain began moving west last year with stores in Seattle, Denver and Vancouver, British Columbia.
“The West Coast is the most Asian-populated area,” said William Choi, chief management officer at H Mart. “Many customers on the West Coast want to have H Mart in their cities.”
The Irvine store is expected to open in December and have about 50 workers, according to Choi.
The company counts about $500 million in annual sales, Choi said.
It’s coming to 99 Ranch territory. The chain’s parent Tawa counts estimated yearly sales of $210 million.
99 Ranch, which declined to comment for this story, has two stores within a few miles of where H Mart plans to go up, one on Culver Drive and one on Walnut Avenue.
The chain has 27 stores in all, including three in OC. Others are in Los Angeles County, San Diego, Atlanta and Seattle.
(H Mart has fewer stores than 99 Ranch but more yearly sales, thanks to its larger Super H Marts in Chicago, Atlanta and elsewhere.)
Choi concedes H Mart “got into the business late in Orange County.”
The biggest challenge will be to set apart H Mart from its rivals and gain the trust of Asian shoppers, Choi said.
H Mart and 99 Ranch have a lot of similarities.
Tawa Supermarket, 99 Ranch’s predecessor, was started in 1984 by Taiwanese expatriate Roger Chen.
The first store was in the Little Saigon section of Westminster.
99 Ranch now is the biggest Asian supermarket operator in California, with about 20 stores in the state. It also has stores in Hawaii and Las Vegas.
H Mart began as a single corner store in 1982 in the borough of Queens.
It now has about 22 H Mart and Super H Mart stores in New York, New Jersey, Pennsylvania, Illinois, Maryland, Virginia and Georgia.
Both chains run modern, well-lit, clean stores that rival mainstream supermarkets.
Both appeal to Chinese, Korean, Japanese and Vietnamese looking for foods from back home.
Both are pushing for non-Asian customers, too.
“H Mart is not only for Chinese, Japanese, Korean and other Asians, but also for Western customers,” Choi said.
The chain carries Pepsi and Coca-Cola alongside exotic produce such as banana leaves, a sizable organic section and a line of packaged snacks that include dried cuttlefish and oyster kimchi.
99 Ranch has stepped up its bid for non-Asians with aisles that feature fine wines and American-style steaks alongside items such as squid, geoduck and octopus.
One industry watcher said he sees plenty of room for both in Irvine.
“99 Ranch is evolving, and if (H Mart) can get 5% or 10% of their business, then they are doing pretty well,” said Jo Javier, president of Carter & Smith Consultancy Inc., an Irvine-based consultant group for small and midsize businesses.
Nearly 60,000 Irvine residents say they are of Asian or Pacific Islander descent,about 30% of the city’s population, according to 2006 estimates from the city of Irvine.
Irvine’s hefty commuter population also is a big source of customers, Javier said.
“It’s the demographics of the employees and the employers who will shop there before they go home to their bedroom communities,” Javier said.
The key for H Mart?
Convenience.
“There is always room for competition because of the convenience factor,” Javier said.
Stores like 99 Ranch and H Mart “kind of bridge what’s happening in the old country and make it convenient,” he said.
Some 99 Ranch stores have butchers, bank branches, video rentals and Chinese pharmacies.
H Mart offers online shopping and an extensive selection of prepared foods. Some stores have food courts.
Some of OC’s smaller ethnic Asian markets could feel the pinch when H Mart comes to town.
Other players include Ebisu in Fountain Valley, Marukai Japanese Market in Costa Mesa and Korean grocery HK Market in Tustin.
The big chains aren’t likely to wipe out the mom-and-pop stores, Javier said.
“Those kinds of business will always stand up to prospective competitors because Asians tend to be very ethnocentric,they will likely continue to deal with their own. It’s kind of like a meeting place.”
Javier, who’s half Filipino, half Spanish, said he likens 99 Ranch and H Mart to “the Albertsons of Asian food.”
99 Ranch already attracts a new breed of customers, which should help H Mart, Javier said.
“The non-Asians who shop there love Asian foods, have traveled to Asia themselves or are intermarried,” he said. “You will see a United Nations of shoppers.”
