Independent Grocer Memo: New York's 7,000 Bodega (Small Grocery) Store Owners Say 'No' to Proposed 18% Tax Hike On Juice Drinks and Soda Pop

Sweet Grocery, pictured above, is a classic, old school Latino family-owned New York City bodega. The name bodega came from these classic stores, mostly started and operated by immigrants in the city's Latino neighborhoods. A distinctive design feature of an original bodega is the calssic metal sign like the one on Sweet Grocery above. Today the term bodega is used in New York City to describe a small grocery store regardless of it look. And most today look just like a typical urban, small grocery store looks. The photograph above was taken by New York City artist Josh Goldstein. His art is inspired by New York City's many bodegas. Josh Goldstien even has a Web site "BodegaNYC,' where he showcases and sells his bodega inspired art, and offers observations about the stores and the city. You can view the Web site and Josh Goldstein's bodega-inspired art here.

The "Bodega (small grocery store) Association of the United States," which is based in New York City and represents 7,000 independent grocery store owners in New York state, according to its Web site, most which independently own and operate small stores or bodegas in New York City, has joined a fast-growing coalition that's fighting New York State legislation that would slap an 18% sales tax hike on juice drinks and soda pop sold at food, grocery, convenience and other stores in the Empire State.

The anti-soda pop and juice drink tax-hike coalition called "New Yorkers Against Unfair Taxes," says it has thus far signed up 90 New York business and citizen's groups in its efforts to stop the proposed legislation. The coalition also says it has so far obtained the signatures of 5,400 New Yorkers in a petition drive it's launched to demonstrate voter opposition to the new tax. [You can view group's petition Web site at the link here.]

Today the anti-juice drink and soda pop tax increase coalition turned up the heat on its campaign in New York City by staging a rally at the Fine Fare supermarket, which is at 1239 St. Nicholas Ave at 172nd Street, in New York City. The store is a branch of the New York-based 50 store Fine Fare supermarket chain.

It's estimated there are about 25,000 grocery stores in New York State, the majority of which are small stores or bodegas, many averaging only a few hundred square feet in size. The highest concentration of those small, independently-owned grocery markets is in New York City. For those who've never visited the Big Apple, there are generally two or three, and often more, of these bodegas on every block.

Here's what Nelson Eusebio, the chairman of "New Yorkers Against Unfair Taxes," says about the "Bodega Association of the United States" joining the coalition: "The exorbitant cost of doing business in New York has already taken a major toll on the state's small supermarkets and neighborhood bodegas, with more than 2,300 bodegas closing over the past four years, representing a loss of more than 8,500 jobs. The inclusion of the Bodega Association of the United States is particularly significant, given its representation of more than 11,000 bodegas throughout the state of New York. (Note: the bodega association's Web site says it represents the interests of 7,000 grocery stores rather than 11,000. So we are using that number.)

Walking around most any neighborhood in the five boroughs, you will see an iron gate where a storefront used to be. In addition to the bodegas, more than one-third of our city's supermarket owners have had to close their doors in the past five years. I'm proud of the way New Yorkers have come together through this coalition to protect this industry and preserve our communities, and we will continue to press forward to defeat this tax," he adds.

Ramon Murphy, the president of the 7,000-member association of small grocery store owners says: "Every week a bodega closes down as a result of the current economic conditions, and this proposed tax could lead to even more family-owned businesses having to shut their doors forever," said Ramon Murphy, President of the Bodega Association of the United States. "We've joined the coalition to prevent this from destroying our livelihoods, and the communities built around these businesses."

The new, proposed 18% sales tax hike will be in addition to the sales tax New York state consumers already pay on the juice and soda drinks. If the legislation is passed, New Yorkers will pay about a 25-30% sales tax on the retail price of the drinks.

The "New Yorkers Against Unfair Taxes" coalition includes in its membership, in addition to the Bodega Association of the United States: The Food Industry Alliance of New York State, which represents supermarket chains and independents in the state; Gristedes supermarket chain; New York Association of Convenience Stores; New York State Restaurant Association, New York State Automatic Vending Association; which represents companies in the vending machine business; Coca-Cola Bottling Company of Buffalo, New York; Polar Beverage Company; Dan's Supreme Supermarkets, Inc., a chain of independent supermarkets in the state; Grocery Manufacturers Association, the national trade group for U.S. grocery product manufacturers; The Coca-Cola Company-Glaceau; National Restaurant Association; Hispanic Chamber of Commerce (many of New York's bodegas are owned by Hispanic Americans, particularly those of Puerto Rican nationality); National Puerto Rican Coalition; and numerous other associations and businesses, including many individual grocery stores and restaurants. [You can read a full list of the members on the anti-tax hike coalitions Web site here.]

New York's Democratic Governor, David Paterson, and the majority Democratic legislature in the state capital in Albany are struggling to find ways to cut expenses and raise revenues because of the state's massive budget deficit. Much of New York's tax revenue depends on Wall Street and the state income taxes paid by the highly paid financial services industry workers who work on the street, according to data Governor Paterson recently presented.

The financial industry crash, and all of the value taken out of the big banks and investment firms, combined with the many layoffs in the industry, have reduced New York state's income tax revenue by double-digit percentages. As a result, the Governor and the state legislature has cut tens of millions of dollars worth of programs, are cutting more, and are searching for new revenue by proposing tax increases like the 18% sales tax-hike on soda pop and juice drinks.

New York city's bodega owners are an important group and can be very affective politically in the state, particularly in New York City. Since they operate thousands of retail stores -- stores where the windows will be plastered with anti-juice drink and soda pop tax-hike signs and where daily the grocers can collectively tell tens of thousands of people about their anti-tax position -- the store owners will be a powerful "retail politics-oriented" force in the coalition's campaign to defeat the proposed legislation.

The anti-juice drink and soda pop tax-hike coalition is planning more rallies like the one held today at the Fine Fare supermarket. A major focus of the anti-tax hike campaign is to highlight what the coalition argues will be the loss of many more jobs at a time of massive job loss already in New York and throughout the U.S. if the tax hike passes.

Of course, the people of New York and the rest of the country want and need added services -- unemployment insurance, medical assistance, ect. -- because of the current unemployment situation.

And it is here where nobody has the answer: In this recession, states like New York and California (and many others) are going broke, hundreds of thousands of people are losing their jobs each month (perhaps 700,00 this month alone), and the demand for government services is way up but tax revenue is way down. There really are only two things state governments can do in some combination -- cut programs and thus expenses and raise revenue (taxes).

Unlike the U.S. federal government, most states in the U.S. can't borrow their way out of the mess because they have state laws that require them to balance the budget. New York and California both have laws that require this.

So it comes down to this: Does a state cut all of its vital services until it can balance the budget in these times when more and more people are demanding those services? Does it raise taxes, like with the juice drink and soda pop tax hike? Or does it try to do some of both: Cut programs as much as feasible and raise taxes in a way that focuses on things like consumption rather than payroll taxes or income tax.

That answer depends on where you sit, we suspect. And for New York's food and grocery retailers, they are sitting, actually standing most of the time, in the position of being the ones that feel they will be most impacted, along with the state's juice drink and soda pop drinkers, by the proposed 18% tax hike on the drinks. Therefore they oppose the legislation.

Independent Grocer Memo: Northern California Independent Ben Lomond Market Creates Job For 90-Year Old Man Scammed Out of $738,000 By Bernie Maddoff

From near-millionaire to $10 an hour, 30 hour per-week grocery store greeter: Ian Thiermann, who's motto is "You do what you have to do," at work in the Ben Lomond Market in Ben Lomond, California. [Photo Credit: KPIX Channel 5, San Francisco.]

Independent Food & Grocery Retailing USA - Independent Spirit

Ian Thiermann, a 90-year old retired businessman from Ben Lomond, California, a small town near the city of Santa Cruz on Northern California's coast, says he lost his entire life savings, $738,000, to the Wall Street financier and Ponzi Scheme crook Bernard Maddoff. The $738,000 was what Mr. Thiermann had saved and invested throughout his working life for his retirement.

As a result of losing it all, Ian Theirmann decided the only think he could do was to return to work at age 90, he told San Francisco-based KPIX, Channel 5 television for a recent report the station did about the Ben Lomond resident.

However, with the current job availability situation so poor, along with the fact he is 90-years of age, Ian Thiermann wasn't completely confident he could find a job in the small, coastal Northern California city where he lives.

But a local independent grocer, Ben Lomond Market, heard about Mr. Thiermann's plight and offered him a 30 hour a week job at $10 an hour as the store customer greeter, a position they created especially for the energetic and sociable 90-year old."This is not a woe is me kind of man.

This is a community coming together and helping each other out in times of need," Barbara Loffer of Ben Lomond Market told KPIX.In explaining his plight and decision to return to the work force as the official customer greeter at Ben Lomond Market, Ian Thiermann told KPIX reporter Kiet Do: "You meet a situation like this, what are you gonna do, fold up? Instead of crying, yelling or being mad about it, face it and move on."

That simple sentence and overall attitude from Mr. Thiermann, a man who at age 90 lost every cent he had saved throughout his working life and as a result did what he had to, which is to go back at work, is something we should all keep in mind as we struggle in the current bad economy.

Times are tough without a doubt -- but like Ian Thiermann, who was born in 1919 and has lived through wars and the Great Depression -- and survived -- says: "You meet a situation like this, what are you gonna do, fold up? Instead of crying, yelling or being mad about it, face it and move on."

That's a motto, and attitude, we all should follow. It's also the attitude that will get the country out of the current economic recession and malaise.[

[You can read the report from KPIX Channel 5 here.]

[You can view video of Ian Thiermann at the Ben Lomond Market at the link below: http://cosmos.bcst.yahoo.com/up/player/popup/?rn=3906861&cl=12126414&ch=4226713]

Independent grocer Ben Lomond Market demonstrates what we often say about America's independent grocers -- that they survive and thrive in the U.S. food and grocery retailing sector in large part because they focus on being an integral part of the communities where they operate their stores. They focus on the local -- local customers, products and issues. We call that the independent (grocer) spirit.

The independent supermarket, which in addition to selling basic food and grocery products specializes in merchandising lots of specialty, natural and organic food and grocery items, along with high-quality fresh, prepared foods, also demonstrates that the community focus we describe and write about America's independent grocers extends far beyond only selling groceries -- it's all about community and neighborhood in most cases. And that generally translates into increased business.

We wish Mr. Thiermann all the best in his new job. And we think he will be a great asset to the market, its owners, and its customers.

Independent Grocer Memo: Tradition, Local Focus, Customer Service and More Keeps Central Oregon USA's Erickson's Thriftway in the Game

All in the family: Erickson's Thriftway managing partner Doug Schmidt (center) towers over two veteran employees at the Bend, Oregon flagship store -- head checker Debbie Huber (left) and assistant manager Marlena Lohman (right) -- only in physcial height and not in the way the independent grocer relates to its employees, which is as part of the family. Debbie Huber has worked at the Bend, Oregon store for 32 years. Marlena Lohman has worked at the store for 29 years. Doug Schmidt is the rookie among the three, having worked for Erickson's Thriftway for a mere 28 years, starting out on the store floor. [Photo Credit/Andy Tullis - The Bulletin.]

Independent Food and Grocery Retailing USA: Guest Memo

A regular reader of Natural~Specialty Foods Memo (NSFM), who also happens to be an independent grocer in the USA, sent us an e-mail note today saying he enjoys when we write about independent food and grocery retailing and independent grocers, commenting in his note that he wished more publications would write about his fellow independents, which are an important segment of food and grocery retailing, be they discount grocers, upscale grocers or natural and specialty foods retailers.

Our independent grocer-reader included a link to a story published in today's Bend, Oregon-based The Bulletin, the daily newspaper of record for the Central Oregon region in the Pacific Northwest USA region.

The story, by staff writer Andrew Moore, is about a local Central Oregon four-store independent grocer, Erickson's Thriftway, and how the independent is not only surviving but doing well despite the bad economy and the strong competition in the market from big chains like Safeway, Fred Meyer (owned by Kroger Co.) and Albertsons, along with intense competition from other regional grocers.

The very first Erickson's Thriftway grocery store opened in downtown Bend, Oregon in 1915. Today the four-store operation is no longer owned by the founding Erickson family but rather by a partnership (privately-held) headed by Doug Schmidt, the managing partner for Erickson's Thriftway.

The four Erickson's Thriftway stores are neighborhood supermarkets, averaging about 20,000 -to- 25,000 square feet. But the grocer packs the stores with nearly as strong of a selection of products as supermarkets twice the size of the Erickson's Thriftway stores do, Doug Schmidt says in the The Bulletin story.

The piece in today's The Bulletin includes a Q&A interview by the writer with Erickson's Thriftway managing partner Doug Schmidt. The interview offers a nice look at just what and how one of the many independent grocery retailing companies in the U.S. is dealing with the current recession and intense competition from mega-chains on its home turf.

We enjoyed reading the story, thank our independent grocer-regular reader for passing it on, and decided to run a link to the story below because we think it will be of interest to Natural~Specialty Foods Memo (NSFM) readers.

The story:

A grocery chain with local roots
The first of the Erickson's stores was established in 1915

By Andrew Moore / The Bulletin February 10, 2009

Doug Schmidt is the managing partner of the Erickson’s Thriftway grocery store chain in Central Oregon, a chain that traces its roots back to its first store opening in downtown Bend in 1915.

Though the four-store chain is no longer owned by the original Erickson family, Schmidt sees to it that the name still stands for service.

"There have been lots of changes in the supermarket business, but it’s no different from other businesses: Take care of your customers and your customers take care of you," said Schmidt.

[Click here to read the full story.]

Independent Grocer Memo: Natural-Organic, Local, Fresh and Premium Keys to Pacific Northwest USA's Haggen Foods; Now Adding Value

Independent Food & Grocery Retailing USA - Pacific Northwest

Although it's stores are experiencing a recession-influenced drop in category sales like retailers throughout the U.S. are, Pacific Northwest USA-based family-owned supermarket chain Haggen, Inc. says natural-organic food and grocery products, along with locally-produced specialty-oriented and fresh, prepared foods, continue to be three of the fastest-growing category segments for the 33-store Western Washington state-headquartered supermarket chain, which operates stores in Washington and Oregon under the Haggen Food & Pharmacy and TOP Food & Drug banners, according to company CEO Dale Henley

"Organic products continue to be one of our fastest-growing segments. The next is local products, which I think will surpass organic soon. There are a lot of great local products in Western Washington, and I think more will come because of customer demand," the CEO of the privately-held independent supermarket chain said in a recent profile piece in the Bellingham Herald, a local newspaper that serves the Western Washington state region.

Haggen, which was founded by the family of the same name in 1933, this year is celebrating its 75th year of owning and operating supermarkets in Washington and Oregon.

Haggen, Inc.'s 33 stores grossed a whopping $870 million in its fiscal year 2008, and the chain is headed towards sales of $1 billion annually, perhaps as early as by the end of 2009, as it remodels and expands a few existing stores and plans to open one or two new stores next year, along with taking over and remodeling a former upscale Larry's Market supermarket in Oregon in 2009. Nearly $1 billion in sales is excellent by industry standards for operating 33 (or 40 for that matter) supermarkets.

The company's 33 supermarkets are divided about in half, with 16 stores currently under the Haggen banner and 17 currently under the TOP banner and format.

The Haggen Food & Drug stores are large supermarkets with an upscale-oriented format. The stores merchandise a full selection of conventional food, grocery and non-foods products (they aren't specialty supermarkets) but put a major emphasis on natural, organic, locally-produced, specialty and ethnic food and grocery items, in-store premium, fresh prepared foods, quality fresh-baked goods, wines, cheeses and other upscale natural and premium food offerings, along with fresh meats and fresh produce, including numerous organic and locally-grown varieties.

The TOPS format is similar to the Haggen banner format stores except it puts an emphasis on discount pricing and value via offering lower everyday prices and deeper promotions, especially on conventional food and grocery items. Both formats though put a focus on natural, premium and fresh foods.

Among the recent additions to the Haggen banner stores include expanded gourmet and artisan cheese departments. The retailer is rolling out new cheese departments in some of its stores that feature about 300 varieties of cheeses, including many produced locally in the Pacific Northwest region.

"Americans are much more interested in cheese. I think it's an industry that's in a position where wine was 10 years ago," CEO Henley said in the recent Bellingham Herald Review profile piece.

Haggen also is putting a major focus on its own store brand food and grocery items, which range from value brands to its premium "Premiere" store brand. In addition to "Premiere," the grocer offers over 100 skus in its "World Classics Trading Company" store brand, which are specialty and artisan-produced food products. The grocer says it now offers about 900 items total under its various store or private label brands.

Haggen also offers the "Full Circle" proprietary brand of natural and organic food and grocery products. "Full Circle" is a control brand which is offered exclusively to only one or two supermarket chains in a given geographical market region. The brand offers natural and organic products to the retailers across all categories, even in the fresh meat category. [You can read more about Haggen's store brands here.

The Haggen Food & Drug banner stores have long been considered the "go to" market for premium and specialty foods in the parts of Washington and Oregon where the stores are located. Additionally, in recent years the family-owned chain has been gaining that same reputation for natural, organic and locally-produced food and grocery products. That's a strong achievement because Washington and Oregon are packed with retailers that not only sell but specialize in those respective categories.

Below are a few other in-store features of the Haggen banner supermarkets:

>In-store bakeries offering specialty desserts, pastries and artisan baked goods made fresh daily.
>Wine Specialists available for recommendations, case orders and special requests.
>In-store Pharmacies with licensed professionals specializing in community healthcare.
>Floral departments offering fresh cut flowers, design, delivery and FTD Service.
>Market Street Cafés with dining area offering specialty wraps and panini sandwiches, authentic oriental cuisine and more.
>Just for Kids child care center offering a fun, safe and professionally staffed facility as a free service to our guests available in some stores.

Natural, organic and specialty foods suppliers and distributors have long used Haggen as their retail point-of-entry in the Pacific Northwest market for new product and item introductions since it is a retailer that for decades has been on the cutting edge in terms of introducing new items in the categories.

In the current economic downturn CEO Henley says Haggen is upping its value proposition, including in the natural-organic, specialty and fresh, prepared foods categories.

He offers some analysis in that regard in this quote from the Bellingham Herald Review profile piece:

"Our meals-to-go segment is still growing, particularly the simpler items, such as soups. But we also see some moving away from that segment and buying more of the basics, like sugar and flour to make food at home. What we think is happening is the new food-service customers are people who used to regularly eat at restaurants and are now doing that less. Then some of our regular food-service customers are moving into the basics in order to save money. Time is still an issue for many families, though, so meals-to-go is growing overall."

The Haggen banner stores in particular have somewhat of a high-price profile among Pacific Northwest consumers because of their upscale, premium and specialty-oriented focus. The company is trying to counter that perception in these down economic times, which have consumers searching for value, by increasing its value proposition, including in the natural, specialty and prepared foods categories, according to the supermarket chain's CEO.

This new focus includes offering stronger price promotions in-store and in its weekly advertising flyer, on both conventional food and grocery products and on premium, natural-organic and specialty products. It's all about adapting to the current bad times, as we say often in Natural~Specialty Foods Memo.

As we write often, regardless of format or key customer base, all food and grocery retailers, from the most discount-oriented to the most upscale and natural-organic-focused, need to create their own unique value proposition during this severe global recession, which in the case of the U.S. is shaping up to be the worse sustained economic downturn since the great depression of the 1930's. Warning: We, along with many independent economists, see the recession lasting all of 2009.

Haggen, Inc. though appears to be not only surviving in the economic downturn in its Pacific Northwest market, it also continues to thrive, albeit with a good amount of struggling like nearly all food and grocery retailers are doing, by focusing on what it does best -- doing basic food and grocery retailing with a special focus on premium, specialty, natural and fresh foods merchandising -- while adapting to the current economic climate by upping its value proposition.

Haggen also focuses on the local communities where it has its stores. And as a locally-based, family-owned company, which is among the largest employers in Western Washington and a significant one in Oregon, it touts its local impact, as well as participates in numerous community and neighborhood-based non-profit and charity programs. It's positioning -- and it walks that walk -- is as the local food and grocery retailer supporting local jobs and residents.

This local emphasis also is taking the form of an expanded effort and program by the supermarket chain to buy and merchandise more locally-produced food and beverage items in its stores -- ranging from wines and cheeses to organic and specialty food and grocery products -- and much more, including even non-foods products made by local companies and entrepreneurs.

We believe local-product buying and selling by food and grocery retailers is only going to get more popular (and stronger among local consumers) in 2009 because of the recession. The concept of buying and shopping local will grow because it's a way to encourage keeping money and tax revenue locally, creating jobs in cities and states, as well as providing increased revenues for cash-strapped local governments.

This trend fits well with Haggen, Inc's location in the Pacific Northwest. Oregon and Washington state offer a bounty of wines, specialty, natural and organic food and grocery products, many produced by small, artisan operations, that can be offered for sale and touted in the locally-based supermarket chain's stores.

It appears the family-owned grocery chain, who's matriarch Dorothy Haggen recently passed away (the chain is owned by her sons Don and Rick Haggen), has figured this out, and is moving even stronger in the "local" direction in everything it does.

Focusing locally in everything they do -- from merchandising and marketing to community involvement -- is one of the key reasons the independently-owned supermarket sector, whether its a 33-store operator like Haggen, Inc. or a single-store independent grocer, is so vibrant in the U.S. -- and will continue to be despite the strong competitive pressure from the mega-chains.

Independent Grocer Memo: Eight-Store Michigan USA Independent Hiller's Markets Demonstrates Why Independents Survive and Thrive in the U.S.

Independent Food and Grocery Retailing USA

Michigan USA independent grocer Jim Hiller embodies many of the qualities that make the independent food and grocery retailing sector the thriving success it is in the U.S., despite all of the pressure and competition independents receive from the chain store giants. Hiller, the CEO of eight-store Hiller's Markets, also has a number of unique qualities that make him an exceptional entrepreneur and grocer, as well as an interesting guy.

For example, he writes and publishes his own Blog on the Hiller's Markets Web site. And he takes positions on issues.

His most recent cause is a campaign encouraging people to "Buy American" automobiles. Michigan, where Hiller operates his eight supermarkets (with number nine on the way) is hurting more than any other state in America in the current economic recession. It has the highest unemployment rate, for example, currently hitting about 13%, compared to a 6.7% rate nationally. And of course, Michigan -- specifically Detroit and its suburbs -- is "Big Three" automaker country. Even with the current government loans, the Detroit automakers are shedding thousands more jobs, which also means thousands more lost because so many other jobs in the state are related to the ato industry. [Read independent grocer Jim Hiller's most recent post, "Why I Drive An American Car," here.]

Hiller's is a success in Michigan for a number of reasons. But central among the reasons are because the small, independent chain does what independents do best -- it offers a great selection of food and grocery products at affordable prices, focuses on specialty items not available elsewhere in many cases, makes customer service job one, and places a total focus on the local communities and neighborhoods where it operates its stores, including customizing each of its eight stores to the particular communities and neighborhoods they are located in.

Below is how Hiller's describes its stores:

"If you’ve never been to an authentic grocery store before, you’ll love Hiller’s," says Jim Hiller

Our grocery stores offer premier products, gourmet delectables, healthy choices, and lifestyle shopping. It has been said that we eat with our eyes before we ever take a bite. You’ll have such a sensory-rich experience at Hiller’s - how good it will feel for shopping to be enjoyable and even fun!

The company was created in 1941 by Sidney Hiller with a commitment to quality, selection, and value. Now, led by Jim Hiller, Hiller’s Markets is Michigan’s home for discerning shoppers. We listen to shoppers, and we obtain items that you request, no matter how arcane, rare, or unusual.

Hiller’s embodies Jim’s passion for food, for wine, and for excellence. The Hiller name is known for quality, variety, great taste, and unparalleled customer service.

Hiller’s is the place for people who absolutely love food and whose desires run from the conventional to the most obscure. You’ll find it all under one roof.

Add Hiller’s to your list of Very Important Places.

Welcome to the way it should be.

Not a bad description, is it? And Jim Hiller isn't afraid to infuse his personality into the operation of the stores, which is another aspect of independent food retailing that's interesting -- the ability to personalize the business, putting a local face on the stores.

Hiller's also does what the most successful independent grocers do best -- adapt to the times. The eight-store independent is doing just that in economically-challenged Michigan. Among the things its doing are slashing prices on nearly every item in its stores from 10% -to- 60%, having met with every one if its 1,000-plus vendors and negotiated special pricing deals which the grocer is passing on to customers dollar-for-dollar in its stores.

Hiller's also is putting an greater emphasis on buying and selling Michigan-made products, offering what is the most extensive selection of local food and grocery products in the state.

Erica Finley, a writer for the Oakland Business Review in Oakland County, Michigan has a profile of Jim Hiller and Hiller's Markets in yesterday's online edition of the publication. In her piece she interviews Jim Hiller and lets him describe his business philosophy and what the optimistic, aggressive but yet humble independent grocer is doing to survive and even thrive in the current economic recession, which is hitting his customers in the Metro Detroit region, where the Hiller's stores are located, just about as hard as people can be hit by a severe economic downturn.

Below is the profile by Erica Finley from the Oakland Business Review:

Jim Hiller, CEO of Hiller's Markets, talks about commitment to customers, community
by Erica Finley Oakland Business Review
December 22, 2008

His family's grocery store chain was just named Independent Retailer of the Year by Grocery Headquarters Magazine. He's slashing prices in his stores but maintaining the quality of the products in the worst economic environment in many years, and he's committed to giving back to the local community.

Click here to read the entire profile piece.

Independent Grocer Memo: National Grocers' Association Asks President-Elect Obama to Look Out For Independent Grocers When He takes Office in January

Independent Food & Grocery Retailing USA

The National Grocers Association (NGA), the trade association for America's independent grocers, has sent a letter to President-elect Barack Obama requesting the new administation maintain a "level playing field" for U.S. independent grocers by enacting a federal economic stimulus package, supporting strong enforcement of federal antitrust laws (including the Robinson-Patman Act), supporting "fair" employer-employee legislation and supporting new federal legislation of credit card interchange fees.

The letter was sent to the President-elect last week, according to NGA president and CEO Thomas Zaucha.

In its letter, the NGA also offered some specific suggestions to the incoming President, who will be sworn into office on January 20, 2009. Those specific suggestions include decreasing corporate tax rates, or the taxes on individuals operating as subchapter S corporations or other pass-through entities. Most independent grocer members of NGA operate family or privately-owned supermarkets, hence this being an important issue to the trade group.

Regarding the inactment of an economic stimulus package, which President-elect Obama is talking about doing to the tune of $600 billion up to nearly $1 trillion shortly after he takes office, the NGA's letter says any such package should extend the current expensing and bonus accelerated depreciation legislation enacted by Congress and President George W. Bush, which is scheduled to run out if not renewed next year. Such provisions are beneficial to privately-held companies, such as the majority of those that comprise the independent grocer association.

From these more routine suggestions, the NGA's letter gets more interesting, touching on issues that are sure to be in conflict with policies of the incoming President and his supporters.

In its letter to President-elect Obama, the NGA argues for relief from the Federal Estate tax for its members, the majority of which operate family or privately-owned supermarkets, as we mentioned earlier. Estate tax relief and the outright elimination of what it and others have called the "death tax" (taxation on inheritance from one family member to another) has been one of the trade association's hot button legislative issues for decades. The amount of money (the threshold) in which estates are taxed was raised under the Bush Administration, with support from many Democratic members of Congress. However it appears the NGA wants even more relief for its members.

The letter to the incoming Democratic President also warned against inacting "over-regulation that can increase labor costs."

Additionally, In the letter to President-elect Obama, the NGA says it opposes mandates for paid sick leave, increased minimum wages, punitive civil penalties for employment law violations and expansion of employment discrimination laws. A pretty healthy laundry list we must say. President Obama has indicated he favors legislation on all four of these issues. Based on its letter it appears the NGA and the incoming administration are at odds on all of these matters then. But if both are willing to comprise they might be able to work something out?

The independent grocer's association also includes a "big issue" in its letter to the new U.S. President, writing that it opposes the Employee Free Choice Act., and a provision in the legislation called "card check," which would replace the current secret ballot method in which employees vote for unionization in secret, with a simple card in which the employees of non-union companies, including those who work for non-union supermarkets, could merely check "yes" on a card if they desire union representation.

It's not so much the actual checking of the card the NGA and others, including the U.S. Chamber of Commerce, oppose about the "card check" provision and the overall Employee Free Choice Act -- which passed the U.S. house of Representatives last year and just lost in the Senate in 2007 by a couple votes and is supported by President-Elect Obama -- it's the fact the legislation makes it much easier for workers and unions to organize, compared to the current system, that they strongly oppose.

In fact, the NGA says defeating the Employee Free Choice Act is its number one legislative priority for 2009, a top priority it shares with numerous other trade associations and U.S. corporations and small businesses. [Read more about the association's top legislative priorities here.]

However, the Employee Free Choice Act happens to also be the top priority for 2009 of organized labor -- getting the legislation passed that is. And, since organized labor was a key force in getting President-elect Obama elected, they have a strong ear in the incoming President, who says he supports passage of the act. Obama supported the act as a Senator in 2007 as well. He also sopported the act during his campaign for President.

Additionally, there is overwhelming support for the Employee Free Choice Act and its "card check" provision in the Democratically-controlled U.S. House of Representatives. House Speaker Nancy Pelosi has said she will bring the legislation up for a vote in 2009, adding that it will pass in the House by "even more than it did in 2007."

There also is majority support in the U.S. Senate for the Employee Free Choice Act. The legislation failed last year by only a couple votes. Since then the Democrats have picked up additional Senate seats in the 2008 election. They have about 58 seats so far and could add another depending on the outcome of the contested Senate race in Minnesota.

The Senate needs 61 votes to prevent a filibuster on the legislation (and on any legislation) by Senate Republicans. It's expected that with 58-59 Democrats voting in favor of the legislation (that assums all will vote in favor which isn't a given), plus the ability to pick up the two Independents in the Senate, plus a moderate Republican or two, like the two moderate Republican Senators from Maine for example, the legislation could pass the Senate with a filibuster proof majority.

It won't be easy though -- and corporate and trade association lobbyists have already started their campaigns against the legislation, even before the new President and new Congress takes office and even before new Employee Free Choice Act legislation has been introduced. It's called a premptive attack.

Lastly, the NGA letter urges the President-elect to make sure federal anti-trust legislation is strongly enforced. The trade group is concerned about any potential concentration of business among supermarket chains in the U.S. in terms of such actions posing a unfair competitive advantage to its independent grocer members. This includes wanting strict enforcement of the Robinson-Patman Act, which prevents price discrimination and related anti-competitive behavior. It's often been applied in food retailing mergers and other related issues of direct interest to the supermarket and grocery industries.

Some might say the trade group is pro-government regulation and legislation as long as it benefits it members, but anti-government legislation and regulation if it hurts its members. Such an argument is essentially correct -- not just for the NGA but for every trade association and interest group in Washington, D.C. This is how business is done in the nation's capital today. Competiting interest groups that are against government intervention of any kind on Monday are all for government regulation -- new laws, financial bailouts, ect. -- on Wednesday, depending on which of those two days their members' interests are being served.

Welcome to Washington, D.C. President-elect Obama. That's right, you've already been in the capital for a few years as a U.S. Senator. So you know how it all works.

Meanwhile, Mr. President-elect we do suggest you look out for the nation's independent grocers as they are a vital and dynamic part of food and grocery retailing in America. They are among the innovators. They are the home town folks -- the grocers who serve and give back to their communties the most generally. They also serve as the idea factory for the entire industry. If you see something a big chain is doing that's innovative, it's likely they got it from an independent.

Of course independent grocers, like all of us, need to look at the bigger picture as well. For example, the NGA might want to eliminate the estate tax completely. But we suggest that money might be needed to pay for all the corporate bailouts the Bush Administration is doing in its remaining days. Some of it also might be needed to feed the growing number of out of work and hungry Americans.

Don't forget NGA, it was the massive deregulation under President George W. Bush, who you supported twice, that is costing American taxpayers, including your member companies, trillions of dollars to bailout the financial institutions and now the Detroit automakers.

Great call on supporting President Bush twice by the way NGA -- he sure is an economic conservative, isn't he? The latest tally looks like he will be credited as being the biggest spender as President since LBJ and his great society. At least U.S. society got some benefits from LBJ's blank checks though. Mr. Bush leaves the country broke and in near-depression. The guns are in need of being replaced and there's very little butter. (Just rubbing it in a bit -- we all make bad calls; but twice?)

It's all about compromise though. Right NGA? Right Mr. President-elect? We need to do much of that in 2009 in order to get the country back on its feet, and to create stronger consumers who have the money to support America's independent grocers, who are the backbone of America and don't ask for bailouts, just like the majority of us. Fewer demands from the left and right and all around, more cooperation -- that should be the mantra for 2009, in our analysis.

Notes:

>View the letter sent to President-Elect Obama by the NGA...NGA's campaign against the Employee Free Choice Act: N.G.A. Action Alert -- Oppose the Anti-Democratic EMPLOYEE FREE CHOICE ACT...Advertisement against: CDW Latest Print Advertisement...NGATV (its in-house Web Network) PR spot on its opposition to the Employee Free Choice Act: Watch now.

Independent Grocer Memo: Despite Two Tesco Fresh & Easy Stores and A New Wal-Mart Marketside Store, Gilbert, AZ USA Grocer is Ready to Rock Downtown

The Phoenix, Arizona suburb of Gilbert has recently been ground zero for new retail food and grocry store openings.

On October 4, mega-retailer Wal-Mart, Inc. opened one of its first four new small-format (15,000 -to- 20,000 square foot) Marketside combination grocery and fresh foods stores in Gilbert, along with opening three more on the same day in the cities of Mesa, Chandler and Tempe.

British grocery chain Tesco also recently opened its second small-format (10,000 -to- 13,000 square foot) Fresh & Easy Neighborhood Market convenience-oriented grocery and fresh foods market in the city.

Both Wal-Mart's Marketside and Tesco's Fresh & Easy formats offer an extensive selection of fresh, prepared foods. The Marketside stores have in-store kitchens and the Fresh & Easy stores receive their prepared foods from the company's huge central kitchen in Southern California.

All this new store opening activity in by the world's number one retailer -- Wal-Mart -- and the world's third largest chain -- Tesco -- hasn't scared off Gilbert's historic Liberty Market, an independent grocery store that's been open in the city since the U.S. Great Depression, though.

Liberty Market owner Owner Joe Johnston and his partners have just completed a major remodeling of the supermarket located in Downtown Gilbert's historic Heritage District, transforming the grocery store into what Johnston calls an "urban marketplace."

The inside of the historic market features a mix of the old and new. There are modern-style clear exposed bulbs hanging from ceiling beams built in the 1930s. On the same concrete floor originally poured in 1958 sit modernist tables with smooth black surfaces.

The remodeled market features an in-store demonstration kitchen where shoppers can see what the chefs are doing through two large glass windows. Among the modern equipment in the in-store kitchen is a Vulcan Oven in which artisan pizza's are baked for sale in the store.

A major part of Liberty Market's new urban flair includes lots of prepared foods from the kitchen. There are full ready-to-heat dinner entrees and side-dishes as well as ready-to-eat grab-and-go foods prepared right in the store.

The market also features an in-store espresso bar/cafe which owner Johnson says he wants to become a downtown Gilbert social hub as well as a place where the city's many commuters will stop off on there way to work.

Professional chef David Traina is Johnson's partner in Liberty Market. He will be running the in-store kitchen, creating what he says will be a combination of basic comfort foods along with more adventurous offerings such as sweet potato salad and authentic Sicilian pizza's, among other offerings. There are fresh baked goods as well.

The market also has a retail section offering shelf-stable, fresh and perishable food and grocery items with an emphasis on specialty products.

Johnson owns three successful restaurants in Gilbert. Therefore focusing on in-store prepared foods along with retail food and grocery items in the revamped Liberty Market is a natural for both him and chef Traina.

The historic market has had four owners since it opened in the 1930's. Johnson is the fourth and says he wants to be the last.

Although he has done extensive remodeling to Liberty Market, owner Johnson says it still retains its historic core. He's referring to the historic elements such as the concrete floor poured in 1958, the 1930's wood ceiling beams and other historic elements which have been retained in the store's remodeling.

The fresh food and grocery market is part of the revitalization of downtown Gilbert and its historic district.

Johnson and Traina say they fear not the big chain outlets that have recently opened in Gilbert. They believe their upscale yet historically-grounded Liberty market and its downtown location offer residents and shoppers not only food and grocery items but restaurant-quality prepared foods items supported by Johnson's reputation as a successful restaurant operator in the city.

Additionally, It's also the only market in the downtown which has been adding various new amenities like Water Tower Park, which is slated to open next month, and the Western Canal Trail which is being completed and is scheduled for an early 2009 opening, according to Johnson.

These new public features, along with a number of new retail shops that have opened in downtown Gilbert in the last couple years, are expected to draw local residents as well as residents from outside the city to the downtown core.

Johnson and Traina say they are prepared for those new customers when they come, along with serving the residents of the entire city of Gilbert.

We like that independent spirit.

Independent Grocer Memo: Birmingham, Alabama USA's Western Supermarkets Goes its Own Way Against the Big Chains With Service and A Local Focus

From the Natural~Specialty Foods Memo Editor's Desk: The Birmingham, Alabama USA food and grocery sales market has become considerably more competitive and fragmented over the last decade, says Ken Hubbard, the owner and president of seven-store Birmingham-based Western Supermarkets. He's the local guy.

"You've got the big box stores on one end, the smaller independents in the middle and on the other end the pharmacies, convenience stores and others also selling groceries," Ken Hubbard says in describing today's Birmingham, Alabama retail food and grocery retailing market.

Over the last 10 years, Wal-Mart, Inc. has been building and opening Supercenter after Supercenter in the Birmingham market, making it the number one seller of food and grocery products today in that market, according to locally-compiled statistics.

In addition, discount retailer Target has been adding stores in the market as has the very successful Florida-based Publix supermarket chain. Then there's longtime region market share leader Bruno's supermarkets, which is growing once again, and the famous southern USA's Piggly-Wiggly chain, along with all of those other format retailers Ken Hubbard describes.

Then there's Hubbard's own seven-store Western Supermarkets, the hometown multi-store independent grocer. Despite all this competition, including from mega-Wal-Mart, Hubbard, like numerous of his fellow independent grocers throughout the U.S., is surviving and doing well.

Hubbard's Western Supermarkets is surviving and even thriving by focusing on those key things a locally-based food retailer can do best, which include offering superior, personalized customer service, along with product selections customized to local shoppers needs, tastes and desires. The independent generally knows these local consumers best because he lives and works among them daily.

A key to Western Supermarkets' success is that it customizes elements of the design and merchandising of each of its seven stores based on the neighborhoods they're located in. For example, a number of the stores feature extensive wine selections, which draw customers not only from the neighborhood, but also from throughout Birmingham and even neighborhing cities. Western Supermarkets publishes two wine newsletters as part of its wine merchandising program, the Wine Celler, pictured above, and another newsletter named the Grape Press, which you can view here.

Another example of this localized merchandising is that three of its seven stores have "The Original Soupman" gourmet soup bars in them. There are numerous other examples of this neighborhood marketing and merchandising, which is one way the multi-store independent competes with the big chains without trying to match them on price.

This prescription--service, niche marketing and localization--is the same formula allowing thousands of multi-store and single-store independently-owned and operated supermarket retailers to continue to succeed in the U.S. despite the continued competitive pressure from big discounters like Wal-Mart and Target, warehouse clubs like Costco and BJ's, giant national supermarket chains like Kroger, SuperValu and Safeway, and mega-regional chains like Piggly-Wiggly, Bruno's and Publix in the Birmingham, Alabama market.

Birmingham-based Western Supermarkets is 60 years old this year. Ken Hubbard, who worked for the local supermarket chain's original owners as a bag boy in 1960 while attending college, and a partner bought the company in 1987. A little later Hubbard bought out his partner, becoming the sole owner of the seven-store hometown mini-chain.

Roy L. Williams, a staff writer for the hometown Birmingham News newspaper, profiled Ken Hubbard and Western Supermarkets in yesterday's edition of the paper. Below is that profile of the 60-year old successful multi-store independent grocer in a market full of white hot competition, with numerous retailers of various formats all after a bigger share of shoppers' food and grocery dollars.

Western Supermarkets hits 60-year milestone: 7-store chain puts focus on service

By Roy L. Williams: Birmingham News staff writer

Ken Hubbard earned some of his tuition to the University of Alabama in 1960 by working as a bagger at Western Supermarket's Five Points West store.

Today, Hubbard is now sole owner of the seven-store chain that this fall will mark 60 years in business - a milestone that comes amid the toughest operating environment seen in decades for the grocery industry.

Hubbard, who along with former partner Ed Goodwin bought the company from co-founder Inos Heard in 1987, says Western is managing to weather what he calls the toughest economic storm of his career, brought on by stiff competition from bigger rivals and soaring gasoline and wholesale food prices that have pinched grocery margins.

"Despite it all, we've been blessed to experience overall same-store increases over the last year or so," said Hubbard, who bought out Goodwin in 1996.

He didn't release sales numbers for the chain. Darwin Metcalf, Western's president and chief operating officer, said Western's value-oriented FoodSmart stores in the Festival Center on Crestwood Boulevard and Keystone Plaza on U.S. 31 in Pelham have especially benefited as consumers have grown more cost-conscious.

Hubbard acknowledged that Birmingham's grocery landscape has changed over the past decade since Bentonville, Ark.-based Wal-Mart Stores Inc. began adding supercenters that sell groceries. The world's biggest retailer has commanded the No. 1 market share for groceries in the area Birmingham for several years now, according to the Shelby Report, a Georgia-based grocery industry research firm.

In addition, discount retailer Target and Florida-based Publix Supermarkets have expanded their presence in Birmingham in an attempt to wrest market share away from long-established players such as Western, Bruno's Supermarkets and Piggly-Wiggly.

"The grocery market in Birmingham is much more fragmented than it used to be," Hubbard said. "You've got the big box stores on one end, the smaller independents in the middle and on the other end the pharmacies, convenience stores and others also selling groceries."

Recent months have added the challenge of surging prices for grocery staples such as milk, eggs, rice and items made from corn. Consumer prices for food items have been rising at the fastest pace in 17 years, putting pressure on operators.

Western has managed to survive by sticking to its roots, said Jack Taylor, the Joseph S. Bruno professor of retailing at Birmingham-Southern College.

"Bruno's used to be like that when run by the Bruno family," Taylor said, referring to the Birmingham-based grocery chain that once dominated the area's grocery business. "When Bruno's was bought out by KKR (an investment firm) in the early 1990s, that's when the chain began to struggle."

After a period when it was controlled by a sister firm based in South Carolina, Bruno's operations are again based in Birmingham. After the return to Birmingham, executives pledged to strengthen service, refocus the product assortment and improve the decor in the chain's stores.

Unable to compete on size, Hubbard said Western has focused on customer service. Half of its full-time employees have been at the company 10 years or more and all of the general managers of its seven stores have been with Western at least 20 years, he said.

Taylor said Western "isn't the cheapest store," but staying small allows the chain to focus on meeting customer needs.

"I bet the meat market managers at Western know regular customers by name, something you can't get at the big chains," Taylor said.

Western has also focused on making each of its seven locations cater to the communities they serve, Metcalf said. Western converted a store at 7737 Second Ave. South into a concept called The Village Market to meet the needs of East Lake and Roebuck residents who wanted a neighborhood market, he said.

"It's more of a market concept," Metcalf said. "It's not so much what we carry there, but how much. We may carry turnip greens or fruits by the pallet load at certain times."

The Mountain Brook location at 2717 Culver Road is known for its wide assortment of 3,000 wines, which draws patrons from as far away as Mobile and Huntsville.

Hubbard, whose son Brett serves as Western's director of deli and floral departments, said he is confident Western will be able to weather its latest economic storm.

"We plan to be here for a long time," Hubbard said. "We have no plans to add any new locations. We will just focus on continuing to provide better service at our existing locations.

Independent Grocer Memo: Wolfe's Market; A Case Study On Why Independent Grocers Continue to Survive and Even Thrive in the U.S. Despite Tough Odds

As we write often about independent grocers in the United States, this food and grocery retailing segment continues to survive and even thrive in America against the giant supermarket chains like Kroger Co., Safeway Stores, Inc., SuperValue, Inc. (and the mega-Wal-Mart) and the scores of huge regional chains, by finding a niche--be it upscale specialty foods or price-impact discount retailing or another niche--and being the best at it in their respective cities and towns.

One such independent grocer is 91 year-old Wolfe's Market on West Foothill Boulevard in the city of Claremont, in Southern California. Wolfe's Market is described by its owner, Tom Wolfe, as "a specialty food store with a high-end deli."

The store has its own "grill chef," Jesus Garcia, who Tom Wolfe says is constantly developing new items for the menu, ranging from different versions of gourmet hamburgers and sandwiches, to fish tacos and chicken nachos. All of these items are premium quality, Wolfe says.

Wolfe's Market also carries an extensive selection of specialty, ethnic, natural and gourmet food and grocery items. The independent grocer also sources top quality fresh produce items and prices them competitively. As he says: "Our peaches taste like a real peach should taste."

The store also offers home delivery service, gift baskets and prime meats ground daily at the market. The home delivery is part of the super customer service element Wolf says gives his market another point of differentiation over his chain competitors.

And competitors Wolfe's Market has. There are four grocery stores within a mile of each other on West Foothill Boulevard in Claremont: Stater Bros., Sprouts Farmers Market, Trader Joe's and Wolfe's Market, according to an interview article with the owner of Wolfe's Market, in today's Inland Valley Bulletin, a daily newspaper in the Claremont region. The Trader Joe's and Sprouts Farmers Market branches opened in just the last year.

In the piece, the independent grocer says having three such competitors, each only a mile from his store, combined with the current poor economy in the region, is posing challenges to the 91 year-old specialty supermarket.

However, the independent supermarket is doing well by focusing on its specialty and quality prepared foods niche, while keeping its superior customer service element running strong. While some other parts of his store are suffering do to the new competition and poor economy, Wolfe says the prepared foods grill is thriving, for example.

Read the article, "Market finds its own niche," in today's Inland Valley Bulletin here. Wolfe's Market provides yet another case study of an American independent grocer who is remaining a success, despite having tough times, by mining its niche and offering shoppers things the bigger chain competitors aren't.

It's a tough road, especially for an independent specialty supermarket in the current poor U.S. economy. However, despite this challenge, along with the ongoing challenge from the big chains, independent grocers, like Wolfe's Market and the thousands of others like it in the U.S., actually are a growing food and grocery retailing segment in America, rather than a declining segment, which is the case in places like the United Kingdom and other parts of Western Europe.

>Read a few testimonials from Wolfe's Market customers here.

>Read about some of the specialty offerings at Wolfe's Market here.

>Read about what makes Wolfe's Market's meat and deli departments "so special" here.

Independent Grocer Memo: Four Oregon Independent Grocers Are Symbolic of the Success of the Independent Food Retailing Sector in the United States

Cary Lowe, owner of The Produce Patch in Bend, Oregon USA helps customer Suzanne Johannsen with her groceries Wednesday afternoon. Lowe recently converted his seasonal produce business into a year-round grocery store and is one of several small neighborhood markets in Bend. “The main focus for us is to be the best quality store in town,” he said. (Photo: Anthony Dimaano. Courtesy: Bend Bulletin.)

As we often write about here on Natural~Specialty Foods Memo, despite the growing power of national and regional supermarket chains in the United States--along with international retailers like Ahold, Germany's Aldi, the United Kingdom's Tesco and others building large food retailing chains in the U.S.--the multi and single-store independent food retailing segment continues to not only survive but in most cases thrive in the U.S.

The success of independents is due to a variety of reasons.

First, independent food retailers are local marketers and merchandisers supreme. The history of the independent grocer--be it a mainstream one or niche operator in the specialty, gourmet, ethnic or natural foods spaces--is one of a local resident of the community who also happens to own one or more grocery stores in his or her community and nearby cities.

Often these stores are family-owned. Independent grocers also are increasingly coming from the ranks of entrepreneurs. While these stores might not be family-owned--they are often owned and operated by individuals or partners who create, build and sustain a family-oriented environment among employees and customers.

Second, independent food and grocery retailers understand the communities they do business in not only because they live in them but also because they play a major role in them. Go to most U.S. cities and ask who is on the city or town council, who the leaders of the local Chamber of Commerce and civic clubs are, and its more than likely the name of a local grocer or two will be among them.

Independent grocers also tend to be the first members of a community to support local charities, schools and other community organizations with donations, food drives for the hungry, letting local Girl Scout troops sell cookies out front of the store, holding free health fairs, and so much more.

Third, independents are the original local marketers and merchandisers. Long before the terms "buy local" and "sell local" were formally coined (the hottest concept among numerous chains at present), U.S. independent grocers were doing just that: buying fresh produce from local farmers if available and selling it in their stores; stocking specialty, gourmet and natural foods items produced locally, often being the first of any retailer to do so.

For example, numerous successful specialty and natural foods companies got their start by first getting there brands and items on the shelves of independent grocers in the cities where they operated, then leveraging the success in these stores to then get into chain supermarkets.

Bare Naked Granola, which was recently sold to mega-food company Kelloggs by the two young Connecticut, USA entrepreneurs who started the brand some years ago, got its start on the shelves of local multi-store independent Stew Leonard's, when shortly after creating the granola product the two owners waited outside the store for Stew Leonard, the company's founder and president, with a bowl of the granola and a carton of milk. Leonard arrived, the two young granola-makers convinced him to taste the product, he liked it and gave them a multi-case order, which sold out in a week or so in his store. As they say: The rest is history.

Lastly, independent food retailers are innovators and customer service experts. Specialty and gourmet foods started out not in chain stores but in independent food stores. Natural and organic foods were introduced in America by independent natural foods retailers and Co-ops. It took years after before even the most progressive chains started carrying what were then called "health foods."

The list of innovations by independent grocers in the U.S. goes on: fresh, in-store prepared foods, imported specialty foods, specialty wine merchandising, building communtiy meeting rooms in their stores, creating child care centers in-store to make mom's shopping easier, taking credit cards in-store (the first loyalty card was introduced by an independent rather than a chain as well), and so many more firsts.

In terms of customer service, independents shine. When chains started having customers carry out their purchases to their cars themselves unless they asked for help, many independents did the opposite, creating a policy that their stores would carry out all customer purchases unless the shopper ask the clerk not to. This provided numerous independents with a competitive advantage, since many consumers would even rather pay a bit more for groceries if that happens to be the case and have them carried out to their cars for them.

Home grocery delivery also was invented by independent food retailers. In the 1950's through the 1970's most independent grocery stores and supermarkets took customer orders over the telephone and then delivered them to the customer's home. This started to go away with many independents in the 1970's, but others just kept on doing it, some eventually changing to a fax-based and then Internet ordering process. Others brought it bakc using the newer technologies.

Today's online ordering and home delivery grocers, along with chains like Safeway and SuperValu that offer the service in parts of the U.S., are just using a variation of something independents have generally always done in the U.S.

We could go on about the innovations in merchandising and customer service independent grocers have made in the U.S.--including being the leaders in specialty, gourmet, natural, organic and local foods marketing, merchandising and selling.

However, today's Bend Bulletin newspaper, based in the Oregon USA city of Bend, has a short piece in which it talks about how that Pacific Northwest city's independent and smaller-sized grocers are competing--and often winning--against national and regional chains.

The piece profiles four independent grocers: A small-store independent grocer, a small-store natural foods operator, a larger-size natural foods grocer, and a produce/specialty foods market.

Each of these three food retailers, despite their respective niches, have various things in common. The one element all three have in common in spades is they have created loyalty among their customers. This is a loyalty that goes beyond price and convenience; its brand building.

Read the Bend Bulletin piece's summaries of the four Bend Oregon independents: Devore's Good Food Store, Riley's Market, Nature's, and the Produce Patch (pictured at the top of the piece) here. There's also a slideshow at the link where you can view photographs of the four stores.

The innovation, attention to customer service, and loyalty creation these four Oregon independent food and grocery retailers have achieved is symbolic of what the thousands of successful independents are doing across the U.S., from California in the west, Georgia in the south, to Pennsylvania and New York City in the east.

Although it isn't easy being an independent out there, especially in the current down economy, U.S. independent food and grocery retailers as a whole are doing better currently than at anytime in history. That says much about innovation, a focus on community, customer service and building loyal customers one at a time, doesn't it?