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By Burt P. Flickinger III, managing Director, Strategic Resource Group
Editor's Note: An interesting past year has given rise to some subtle yet significant changes on the latest edition of Progressive Grocer’s annual Super 50 ranking of the top grocery retailers. With this in mind, PG enlisted retail food industry expert Burt P. Flickinger III, managing director of Strategic Resource Group, to share candid observations and in-depth insights about select retail newsmakers on the annual retail leaderboard. His assessment of nine retailers – which are segmented into four parts and which draws on his personal and professional opinions and years of research, as well as from archival data contained in the 10th anniversary of PG’s Super 50 in 1975 – appears in a new PG online exclusive feature, The Flickinger Files.
H-E-B Grocery Co. – ranked No. 6 on PG's Super 50
Twenty five years after Sam Walton and Walmart tried to lay waste to H-E-B in Texas in a "store war" that resembled the food retail reenactment of the Battle of the Alamo, H-E-B is the winner from Mexico to the Southwest. After some of the fiercest price wars in the history of retail, all consumer constituencies clearly prefer H-E-B over Walmart, as well as a range of other national and regional food and drug competitors in the Lone Star State.
Charles Butt has built the best leadership team of all the privately held retail chains with seminal retail leaders like Fully Clingman, Bob Bolinder, Steve Harper and Bob Chapman to take H-E-B Grocery from the fourth largest grocer in Texas on the 10th Anniversary of Progressive Grocer’s Top 50 (1975) to the fourth largest U.S. headquartered food retailer and the sixth ranked retailer overall on PG’s 50th Top 50 Anniversary (2015). H-E-B has consistently impressive innovation ranging from formats to in-store departments to customized and flex assortments.
H-E-B's leaders are great both intramurally, as well as the best in retail relative to every type of chain stores. Suzanne Wade's team's achievements are particularly impressive, and Martin Otto has been a peak performer in finance and strategic planning to leading edge merchandising.
H-E-B's private brand portfolio development is some of the best in the U.S. and its 360 degree efficiency from manufacturing to retailing ranks among the best in the industry.
Starting 50-plus years ago, every Sunday after church, my father, Burt Jr. and mother, Dr. Bonnie Flickinger, would take my sisters and me either to McDonald’s for lunch or Freddie’s Original Doughnuts factory and quiz us first on what we learned in Sunday school followed with a discussion of what was new and better in each of Progressive Grocer’s “Store of Month” – required Saturday reading afternoon after work – as well as who was growing and why.
Aside from H-E-B, Clyde Smith's Smitty's Town & Country superstores in Arizona, John F. Schwegmann's giant New Orleans food emporiums (up to 255,000 sq. ft.) – which was everything that Sam Walton copied at Walmart for decades – Hannaford, Kroger, as well as the range of great food retail entrepreneurs from Andy Balducci's original "cathedral of food" in Greenwich Village, to the evolution of Russ Byerly's elegant "emporiums of food" along with Lund's in Minneapolis, and Butch and Bob Castellani's Tops International Stores – which produced higher sales than Wegmans in the beginning – were regular Flickinger family retail visits. Indeed, they were memorable parts of our family discussions about the most innovative regional leaders in food retailing.
But I digress.
Dr. Wendell Earle and Gene German the great leaders of Cornell University’s world renowned Food Industry Management Program referred to H-E-B as "the best of the best" and sent undergrad and grad students to Cornell’s Mann Library to study how a understated family business could be the proverbial David beating all the major chain Goliaths.
During the category dominant retail era of the late 20th Century, some communities reportedly requested Walmart super centers. In the 21st Century, the preferred retail chain for all communities is H-E-B, as Walmart super centers are in the beginning of a long, slowly developing unplanned obsolescence cycle.
On the 110th anniversary of H-E-B, founder Florence Butt can proudly smile from "upstairs" on Charles Butt and her H.E. B. Grocery Co.'s extended family, for both raising standards of living for all consumers in every community and for providing the greatest philanthropy from a retailer to essential charities since the early 1900s, when George Draper Dayton founded what became DHC (Dayton Hudson Corp., now Target).