In a letter to customers yesterday, Ukrop's Super Markets Inc. said it trimmed its fuelperks! discount in half and will focus attention on cutting prices at stores.
Robert S. Ukrop, president and chief executive of the grocery chain, said that based on customer comments and dropping gasoline prices, the chain is getting more aggressive with in-store discounting. The chain lowered prices on about 2,500 items, he said.
To offset the costs, it cut back on the gas-savings program.
The fuelperks! program, which began June 30 when gasoline prices were spiraling toward $4 per gallon, offered customers a 10 cent-per-gallon discount for every $50 spent at a Ukrop's store. That reward has been reduced to 5 cents per gallon and extended until at least March 28. The discount is redeemable at 30 Uppy's Convenience Stores.
Ukrop wrote in the letter that the change was made because customers have said "food costs have become a more significant part of their household budget."
The chain said customers have saved more than $5.1 million in gasoline costs since fuelperks! was introduced.
The Kroger Co. offers a per-gallon discount of 10 cents for every $100 a customer spends. The grocer recently added prescriptions to the list of items it counts toward purchases and gives 10 cents off gas purchases for every $50 spent on gift cards.
Unlike Ukrop's, Kroger customers can redeem just 10 cents per gallon off one fill-up before the end of the next month at company gas stations, regardless of how much was spent in its stores.
Ukrop's program limits customers to a maximum purchase of 20 gallons at the discounted price, but the discount can keep growing. The fuel discount must be taken within three months of the grocery purchases.
David Saunders, president of Madison + Main, which handles Uppy's brand management and its public relations, said the partnership with Ukrop's increased the convenience stores' visibility.
The chain, which has 38 stores, introduced a branding campaign that focuses on food and other merchandise inside its stores, where it has higher profit margins, Saunders said.
During the promotion, Ukrop's is paying the difference between the price at the pump and the discount.
Contact Joe Macenka at (804) 649-6331 or jmacenka@timesdispatch.com.
Contact Louis Llovio at (804) 649-6348 or LLLovio@timesdispatch.com.
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