After the initial opening, the company plans to roll the concept out to a few markets, said Jeff Noddle, Supervalu's chairman and CEO, at an investor conference in New York City earlier this week. "Where we go from there, we'll see," he said.

The Indianapolis store will total 15,000 sf, and as units roll out, they will average between 12,000 sf and 15,000 sf. One investor asked Noddle about competition with long-time natural grocery operator Wild Oats, to which he replied, "This is a different proposition than Wild Oats."

But Supervalu apparently won't shy away from competitors like Wild Oats and Whole Foods. "I don't think we would avoid a site because it has a Whole Foods nearby, but we're not searching out sites that have Whole Foods," says John Hooley, president of Supervalu's corporate retail.