Hy-Vee- shift 500 corporate employees back to retail stores

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Re: Hy-Vee- shift 500 corporate employees back to retail stores

Post by storewanderer »

retailfanmitchell019 wrote: March 16th, 2023, 10:49 pm
The truth is, the upper Midwest has been a tough place for large grocery chains. Minneapolis/St. Paul is one of the largest metro areas without a Kroger or Albertsons presence.
People in Minneapolis/St. Paul tend to prefer locally-owned places for groceries, whether it be Cub, Target, L&B, or the random independents scattered throughout the metro (like Jerry's Foods or Kowalski's), most of which are upscale, beautiful places to shop.
Albertsons and Safeway were both bidding for now-defunct Rainbow Foods in 2000, with Albertsons rumored to be closing in on Rainbow when Fleming put the chain on the sale block. Albertsons had looked at entering Minneapolis/St. Paul a year or two earlier (after entering Des Moines, IA), either through organic expansion or buying Rainbow.
Fleming put Rainbow on the sale block in 2003, with Albertsons again rumored to be buying Rainbow. Roundy's bought Rainbow, as they made a higher bid than Albertsons. Albertsons and Safeway must've been smart, as they probably knew that Minneapolis/St. Paul is a very unique grocery market. Big chains like Kroger, A&P, and later Rainbow in the Roundy's era with their formulas did not succeed in Minneapolis/St. Paul.
It isn't a volume issue for Hy-Vee in MSP, it seems to be a profit issue.

Jerry's Food is a Cub franchsee. They have a few stores as Jerry's, not sure why, maybe size. Pretty basic stores. Arguably better quality/higher cost perimeter than Cub (some better meat/deli). They may have one that is a Dollar type of format (not sure if it is still around). Nothing upscale about Jerry's. Clean basic store. Jerry's runs strong volume stores (either Cub or the Jerry's banner).

L&B tends to be smaller stores. High priced. Almost boutique like. You wouldn't do a full shop there, it is simply too expensive. Reminds me of a Gelson's- in terms of my perception of their quality too (not worth what it costs).

I think the reason MSP has been tough is due to intense efforts by Supervalu to protect itself and its interests. So by default these Cub franchisees, operators like L&B, are very protected from competition. Any time someone who is not going to be supplied by Supervalu tries to do something there, they have trouble. Remember Target's grocery efforts in the early years were also supplied by Supervalu.

Hy-Vee is lucky to have built up the operation they have there. They do very high volumes. The Supervalu customers and Target seem to be messing with them on price. Hy-Vee tends to have rather high prices, but in MSP they are sharply priced to be competitive with Cub and Target. Those are the best priced Hy-Vees I've ever seen.
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Re: Hy-Vee- shift 500 corporate employees back to retail stores

Post by arizonaguy »

storewanderer wrote: March 16th, 2023, 11:11 pm
retailfanmitchell019 wrote: March 16th, 2023, 10:49 pm
The truth is, the upper Midwest has been a tough place for large grocery chains. Minneapolis/St. Paul is one of the largest metro areas without a Kroger or Albertsons presence.
People in Minneapolis/St. Paul tend to prefer locally-owned places for groceries, whether it be Cub, Target, L&B, or the random independents scattered throughout the metro (like Jerry's Foods or Kowalski's), most of which are upscale, beautiful places to shop.
Albertsons and Safeway were both bidding for now-defunct Rainbow Foods in 2000, with Albertsons rumored to be closing in on Rainbow when Fleming put the chain on the sale block. Albertsons had looked at entering Minneapolis/St. Paul a year or two earlier (after entering Des Moines, IA), either through organic expansion or buying Rainbow.
Fleming put Rainbow on the sale block in 2003, with Albertsons again rumored to be buying Rainbow. Roundy's bought Rainbow, as they made a higher bid than Albertsons. Albertsons and Safeway must've been smart, as they probably knew that Minneapolis/St. Paul is a very unique grocery market. Big chains like Kroger, A&P, and later Rainbow in the Roundy's era with their formulas did not succeed in Minneapolis/St. Paul.
It isn't a volume issue for Hy-Vee in MSP, it seems to be a profit issue.

Jerry's Food is a Cub franchsee. They have a few stores as Jerry's, not sure why, maybe size. Pretty basic stores. Arguably better quality/higher cost perimeter than Cub (some better meat/deli). They may have one that is a Dollar type of format (not sure if it is still around). Nothing upscale about Jerry's. Clean basic store. Jerry's runs strong volume stores (either Cub or the Jerry's banner).

L&B tends to be smaller stores. High priced. Almost boutique like. You wouldn't do a full shop there, it is simply too expensive. Reminds me of a Gelson's- in terms of my perception of their quality too (not worth what it costs).

I think the reason MSP has been tough is due to intense efforts by Supervalu to protect itself and its interests. So by default these Cub franchisees, operators like L&B, are very protected from competition. Any time someone who is not going to be supplied by Supervalu tries to do something there, they have trouble. Remember Target's grocery efforts in the early years were also supplied by Supervalu.

Hy-Vee is lucky to have built up the operation they have there. They do very high volumes. The Supervalu customers and Target seem to be messing with them on price. Hy-Vee tends to have rather high prices, but in MSP they are sharply priced to be competitive with Cub and Target. Those are the best priced Hy-Vees I've ever seen.
MSP seems almost identical to Kansas City in that the local wholesale supplier (Supvervalu in MSP and AWG in Kansas City) has worked hard to keep almost everyone out,

Kansas City is pretty much all AWG affiliated independents (Price Chopper, Hen House, others), Hy Vee, SuperTarget and Walmart along with a handfull of Aldi, Trader Joe's, Whole Foods and Sprout's locations.

I've spent a decent amount of time in the Kansas City area and it's amazing that once you get out of Wyandotte and Johnson counties (the KC metro counties) Dillon's (Kroger) is by far the dominant grocer everywhere (at least on the Kansas side of the metro).

I understand that Safeway was in the area (left in the 1980s) and Schnuck's tried to break into the market in the 1990s but Kroger left the Kansas City area in 2008 selling it's 4 remaining stores to AWG.
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Re: Hy-Vee- shift 500 corporate employees back to retail stores

Post by storewanderer »

arizonaguy wrote: March 17th, 2023, 8:56 pm

MSP seems almost identical to Kansas City in that the local wholesale supplier (Supvervalu in MSP and AWG in Kansas City) has worked hard to keep almost everyone out,

Kansas City is pretty much all AWG affiliated independents (Price Chopper, Hen House, others), Hy Vee, SuperTarget and Walmart along with a handfull of Aldi, Trader Joe's, Whole Foods and Sprout's locations.

I've spent a decent amount of time in the Kansas City area and it's amazing that once you get out of Wyandotte and Johnson counties (the KC metro counties) Dillon's (Kroger) is by far the dominant grocer everywhere (at least on the Kansas side of the metro).

I understand that Safeway was in the area (left in the 1980s) and Schnuck's tried to break into the market in the 1990s but Kroger left the Kansas City area in 2008 selling it's 4 remaining stores to AWG.
It is interesting how that has worked. AWG has quite a few different store operators in Kansas City metro too.

That 2008 thing where Kroger moved its last few Kansas City suburb Dillon units to AWG was in exchange for AWG to exit its corporate operated stores in Topeka and Wichita. It was technically a store swap. Kroger kept a Dillon in Leavenworth, KS which is not too far from Kansas City for someone who really wants to shop them, and AWG kept a Homeland in Haysville, KS (now some kind of cost plus format still run by Homeland). Also in that 2008 deal Kroger gave a store site to AWG at what the time was a very far edge of Kansas City metro in Lenexa. Prior to that Kroger had built a Kwik Shop on the front of the site but did not yet build the Dillons. One of the Price Chopper operators ended up getting that site for a store of their own (which is built as Price Chopper and may be a little larger than Dillons would have been).
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Re: Hy-Vee- shift 500 corporate employees back to retail stores

Post by Romr123 »

Actually both A&P and Safeway left in the 80s. Safeway's last new build was built in 1987 at 119/Metcalf.
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Re: Hy-Vee- shift 500 corporate employees back to retail stores

Post by storewanderer »

Romr123 wrote: March 18th, 2023, 8:50 am Actually both A&P and Safeway left in the 80s. Safeway's last new build was built in 1987 at 119/Metcalf.
I think they were run as Food Barn before exiting or right after exiting?

I think there was an actual Kansas City Division... unless then ran from Little Rock?

The Kansas Safeways elsewhere in Kansas away from Kansas City metro seemed to be connected to Oklahoma (most ended up as Homeland I guess, none still open).
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Re: Hy-Vee- shift 500 corporate employees back to retail stores

Post by Romr123 »

I was visiting KC frequently at that time and moved there in 1989. The "normal" branding was Food Barn/Super Food Barn, but I believe there were a few stores which retained the Safeway branding (Prairie Village Shops, perhaps Westport, perhaps Midtown).

That 119/Metcalf store opened as Super Food Barn (and had the first 3-in-one KFC/Taco Bell/Pizza Hut operated by KFC in an outlot).

Stores in outstate Missouri (Columbia/Jefferson City) were definitely Food Barn.

I believe Oklahoma operated as Safeway (rather than Food Barn) until the sale to Homeland. Their last new build was probably a store in Broken Arrow (near Tulsa) in 1984-ish that was apparently a real showplace and had a unique square layout with diagonal aisles---there's a Progressive Grocer article about it floating around.
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Re: Hy-Vee- shift 500 corporate employees back to retail stores

Post by storewanderer »

Romr123 wrote: March 19th, 2023, 7:46 am I was visiting KC frequently at that time and moved there in 1989. The "normal" branding was Food Barn/Super Food Barn, but I believe there were a few stores which retained the Safeway branding (Prairie Village Shops, perhaps Westport, perhaps Midtown).

That 119/Metcalf store opened as Super Food Barn (and had the first 3-in-one KFC/Taco Bell/Pizza Hut operated by KFC in an outlot).

Stores in outstate Missouri (Columbia/Jefferson City) were definitely Food Barn.

I believe Oklahoma operated as Safeway (rather than Food Barn) until the sale to Homeland. Their last new build was probably a store in Broken Arrow (near Tulsa) in 1984-ish that was apparently a real showplace and had a unique square layout with diagonal aisles---there's a Progressive Grocer article about it floating around.
Oklahoma definitely operated as Safeway and not Food Barn (same for Kansas).

8829 South Memorial in Tulsa was a very late build Safeway in OK. It was like a Marketplace Store. At some point Homeland closed it.
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