Industry observers are keeping an eye on several retailers: many are regional and rapidly expanding, while others are gaining momentum and have proven themselves exceptionally well positioned for growth.
In this Produce Blueprints series, we delve into eight grocery operators experts say are worth watching.
HY-VEE, INC.
Hy-Vee, Inc. BB #:101759, founded in 1930 and owned by its 93,000 employees, stresses customer service, guided by the slogan, “A Helpful Smile in Every Aisle.”
The chain has more than 285 stores in eight states: Iowa, Missouri, Illinois, Kansas, Nebraska, South Dakota, Minnesota, and Wisconsin, and has almost doubled its employee count and annual sales over the past decade. Hy-Vee has also been developing and investing in new businesses as well.
Based in West Des Moines, IA, more recent expansion efforts have concentrated on Minnesota and Wisconsin. The company entered the Twin Cities market in 2015 and has been adding locations ever since.
In 2022 it opened new stores in Maplewood and Spring Lake Park in the Twin Cities area, as well as in St. Peter and New Prague to the south. In November 2022, Hy-Vee opened its sixth Wisconsin location, in Ashwaubenon.
Hy-Vee is also planning to open 20 stores outside its core area of operation, including in Alabama, Indiana, Kentucky, and Tennessee, with locations having been announced in all but Alabama.
The new Ashwaubenon, WI store is the fifth of a reimagined format being introduced across Hy-Vee.
Phil Lempert, founder of the Supermarket Guru in Santa Monica, CA, for one, is impressed, noting the retailer is “continually testing and pushing the envelope to deliver the best shopping experience possible. Hy-Vee never rests on its laurels—it’s always trying to find what’s next.”
The 125,000-square-foot Ashwaubenon location has a variety of in-store specialty shops, amenities, and high-tech services including digital shelf labels; large screens featuring products, promotions, and services; digital kiosks for prepared foods and meals; and scan-and-go mobile payments, which the chain has been adding to new stores in partnership with FutureProof Retail.
A substantial fresh produce area is also included, with a selection of more than 3,500 fresh produce items including 120 organic items. Produce is also highlighted elsewhere according to Lempert.
“Hy-Vee integrates produce into other parts of the store,” he explains, noting an extensive array of produce is part of the chain’s overall commitment to health, nutrition, and wellness.
An example is the everyday practice of the bakery team’s visit the produce department for blueberries or other fruits and vegetables to use in store-made, fresh cream cheese flavors of the day, to be offered with bagels.
As mentioned, Hy-Vee has also been expanding into new formats and businesses. Since 2018 it has launched Dollar Fresh discount stores, Fast & Fresh convenience stores, and Wall to Wall Wine and Spirits.
It also oversees a number of online ventures including a direct-to-consumer health and beauty site, pet products business, and couponing and deals site, all helping to expand the retailer’s business beyond the Midwest.
There are also various subsidiaries and partnerships, including a telehealth and prescription delivery service and private label vitamins.
In spite of all this activity, in early 2022 the company announced plans to reduce its corporate workforce and shift employees to store positions. Some new construction projects were put on hold, expansion slowed, and there were leadership changes too.
Nonetheless, Hy-Vee rings up sales of more than $13 billion annually, and typically ranks near the top of annual lists of favorite grocery stores, including Newsweek’s 2022 list of Top 5 Most Trusted Grocery Retailers.
This is an excerpt from the cover story in the March/April 2023 issue of Produce Blueprints Magazine. Click here to read the whole issue.
