Reinvention. The Masters of. Retailer Profile. Niskayuna Co-op

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1 Retailer The Masters of Reinvention Niskayuna Co-op AT A GLANCE Owners: Niskayuna Consumers Cooperative Inc. Number of stores: One Year established: 1943 Location: Niskayuna, N.Y. Total square footage: 9,000 store, 10,000 total Employees: 55-60, including 26 part-time Phone: Websites: niskayunaco-op.com 16 t h e g ou r me t r e ta i l e r J UNE/ J ULY 2013 With ShopRite and CVS nearby, It is kind of foolish to have the same items on the shelf, says Don Bisgrove, general manager, pictured right with Richard Gabree, assistant store manager. ret ailer.c om

2 Niskayuna Co-op is thriving in the face of increased competition By Anna Wolfe When the Niskayuna Consumers Cooperative Inc. was founded in 1943, the country was in the middle of a world war, Franklin Delano Roosevelt was president, and there weren t any grocery stores in the area. Fast forward 70 years and 12 presidents later. Niskayuna Co-op is no longer the sole purveyor of groceries in Niskayuna, N.Y. It is facing increased competition from more retailers entering this upstate New York market. Focused on serving its members and the community at large, Niskayuna Co-op has been adapting and innovating, all the while remaining competitive in today s changing retail environment. A Food Market Over the years the co-op has evolved in scope and size. Located in the same storefront since 1947, the co-op has expanded twice by acquiring adjacent storefronts. Since 1968, the building has had the same footprint, with the retail store measuring about 9,000 square feet. But the biggest changes are what is going on inside the store. The last three or four years, the co-op has shifted its product mix. We used to call it a supermarket. Now we call it a food market, explains r m et ret ailer.c om J UNE/J ULY 2013 t h e g o u r m e t r e ta i l e r 17

3 Retailer For its efforts, the co-op received C&S Wholesale Grocers Innovation Award for Don Bisgrove, general manager. We re really into fresh foods, local foods, gluten-free and natural. We ve reinvented ourselves. In 2011, ShopRite opened a block away from the co-op. Almost immediately, the co-op experienced a 15 percent drop in sales, but sales have rebounded as it has shifted its product mix. Their focus is different. We re stepping aside from that, Bisgrove says of the conventional grocery market. Membership Has Its Priviledges The cost of joining the co-op is a one-time fee of $5. The co-op has approximately 22,000 members on the books, but not all are active. Because of the low price of ownership, many shareholders do not surrender their shares when they move. Every year, the co-op gives back about 2 percent of profits in the form of member discounts. We re not in the supermarket business. We re in the food business. The co-op has repositioned itself as a specialty retailer more specifically, a food market focusing on local and specialty foods. Gone is the health and beauty aids section. We looked like a CVS drugstore, which also opened nearby. We had everything, including sneakers and underwear, says Bisgrove. More competition is coming to the area. Fresh Market has announced it will open its first store in New York state in nearby Loudonville, and Wal- Mart Stores Inc. will open a 40,000-square-foot Neighborhood Market, its first in upstate New York, in Niskayuna in October. Local Incubator About five years ago, the co-op began ramping up its selection of local foods. It s a movement that continues to grow, both in demand and in the number of start-ups, notes Bisgrove. Local products, which the co-op loosely defines as a product sourced within 50 miles, include bakery items, granola, sauces, yogurt, 18 t he gou r me t retai l e r JUNE/JULY

4 Retailer fax TM Blondies and BroWnies Be happy eat a BroWnie! milk, cheese, grass-fed beef, free-range chicken, eggs and produce. Currently the co-op carries about 120 to 130 local products, many of which it has sourced from the nearby greenmarket. Once new, local products are added to the store s mix, they re tracked in a special category. The coop s local incubator program helps introduce the new products in a manner that doesn t affect the departments performance, explains Bisgrove. Many of the local vendors, many of whom are just starting out, are not used to wholesale and margin, he adds. With shelf-space at a premium, this way of introducing and tracking gives the local newcomers a chance to gain valuable feedback and build a following before standing toe-to-toe with national natural and organic brands. We encourage a product to come in, and if it does well, we ll add it, explains Bisgrove. Between the center store and the produce department, the co-op sets up a sampling station where local vendors can interact with customers. On a regular basis, Indian, Moroccan and Lebanese foods are sampled and sold, and Delmar Sharpener, a local cutler, sharpens knives. The co-op does have national brands such as Coca Cola, Pepsi and Coors; however, the beverage aisle is filled with specialty beverages and 135 beer SKUs, most of which are from the region. Naturally Yours In the last five to 10 years, organic and natural foods have become Special Occasions In-store events are a regular part of the shopping experience at the co-op. Not only do they help drive traffic, but they also engage the community and create a bit of excitement. The third Saturday of every month, the co-op hosts six to eight vendors that sample their specialty foods and engage directly with the customers. For Father s Day, the co-op hosted an outdoor barbecue, using meats from Buckley Beef. In July, there s Fun Fare, where the co-op hosts the greenmarket vendors and crafters. The day-long event features family-friendly fun such as a cake walk and a bouncy house for the children. 20 t he gou r me t retai l e r JUNE/JULY 2013 Store Sales Section Percent Center store 30 Meat 20 Produce 13 to 14 Dairy 13 Deli 12 to 15 Bakery 6 Frozen 6

5 increasingly popular with the members of the co-op, notes Bisgrove. The store has expanded its selection of gluten-free foods and even has a dedicated freezer case. Many of those products were introduced to the co-op by Marty Stein, account manager for Tree of Life, a Kehe Company, who has worked with Niskayuna Coop for 40 years. What makes Niskayuna Co-op stand out, Stein says, is that it is receptive to its customers needs. They act fast. There s no chain of command. If a customer wants a product, we can get it for them the next day. Through Tree of Life, specialty foods and other items that are not in stock can be ordered. While Stein is probably the biggest cheerleader for the Niskayuna Co-op, the co-op is equally fond of him and his efforts to keep this one-store independent at the forefront of specialty food trends. To stay on top of the latest industry trends, Stein says he attends about 12 tradeshows a year. The store would not be what it is today without Marty, says Bisgrove. Having quick access to specialty foods is a The big craze is Greek yogurt, says Richard Gabree, the co-op s assistant store and dairy manager. CASH IN ON Navy Pier Chicago August KITCHENGARDENING Profit from the World s Largest Garden Trade Show - Go Where the Specialty Garden Centers Go for the Newest Trends & Products! It s my first time at the IGC Show. And I am really excited! Everybody we talked to says it s the show to go to, and that is absolutely true. Nancy Robertson, Owner, Kingwood Garden Center, Kingwood, TX PARTY & CONCERT SPONSORED BY FANTASY GIRL HOLD ON LOOSELY FREE IGC CONCERT! Legendary Rockers: 38 SPECIAL WIN the Newest ipad! Register by July 31, and one of 10 ipads could be yours! Day Before the Trade Show - Garden Store Tour! SEE WHAT PUTS THESE STORES AT THE TOP OF THEIR MARKET 1,000 + booths! Speciality Foods, Plants, Decor, Outdoor Living, Holiday & More 56 Hours of Retail Training! Register Today Show Is FREE! IGCSHOW.COM Facebook.com/IGCshow SPECIAL SECTION! MORE THAN 100 NEW VENDORS! JUNE/JULY 2013 t he gourmet retai l e r 21

6 Retailer The store has a dedicated freezer of gluten-free foods. Niskayuna Co-op has a unique candy section with upscale gourmet and organic brands like Theo, Endangered Species, Chocolove and Equal Exchange. Nobody in the area has this selection. We re bringing in products from all over, says Tree of Life s Marty Stein. Fresh-cut flowers are sourced locally from Felthousen's Florist, a fourthgeneration, family-owned company. necessity in today s fast-paced market where consumers want instant gratification. Whatever Dr. Oz says is good, we have to have it the next day, says Richard Rit Gabree, the assistant store and dairy manager. Palm oil, coconut oil, cherry juice and Greek yogurt are a few of the products that have been mentioned on The Dr. Oz Show. Among the store s main attractions are the meat department and highly trained butchers. The store Social Connections At the co-op, there s a huge initiative to bring in the golocal movement. The co-op regularly has a table at the local greenmarket and also advertises in Metroland, the local weekly paper. Ben Wallach, marketing director, has been spearheading the retailer s social-media efforts. On behalf of the co-op, he posts about four times a day on Facebook and also is active on Instagram, both of which are instrumental in reaching out to younger customers. has devised a color-coded tray system to denote different beefs: white trays feature top-quality conventional beef cuts; certified Hereford beef cuts are on blue trays; pink trays are reserved for the local grass-fed beef from Buckley Beef; and black is for Black Angus beef cuts. Popular meat offerings include Buckley Farms line of local, grass-fed, grass-finished beef, natural pork and free-range chicken. The demand for grass-fed beef is growing, Bisgrove says, as conventional beef prices continue to increase, which he attributes to a shortage of corn due to last year s draught. The store is stocked with an impressive array of local baked goods: chocolate babka from Delancey Bakery, Zullo Cookies, Klara s Gourmet shortbread, Italian breads and rolls from Perreca s Bakery and Mastroianni Bros., and breads from Heidelberg Bakery. The store sells more than 150 pies a week from local favorite Mourningkill Bakery and 50 to 100 loaves of local bread daily. Bisgrove points out that 6 percent of the store s sales are in bakery especially with those pies. The co-op bakes its own cookies in-house. The 22 t he gou r me t retai l e r JUNE/JULY

7 Retailer Investing in the Future Last September, Niskayuna Consumers Cooperative celebrated the completion of its latest remodel, which cost approximately $500,000 and included new aisle markers, track lighting, shorter checkouts, a new kitchen floor and an updated store logo. It s modern, but [the store] has kept its hominess, says Marketing Manager Ben Wallach. One of the most notable changes is the store s new wood-like PVC flooring, which ingeniously hides the subfloors imperfections. It also creates the illusion that the aisles are wider and longer. The store s layout was also tweaked. Produce, which is located in the front of most stores, was relocated to the center-rear of the store. [The layout] is really different, says General Manager Don Bisgrove. Most popular products are together in grocery. We put center store first, and heavy stuff and frozen foods near the checkout. In 2003, the co-op underwent a major $1.25 million transformation. The store was gutted from ceiling to floor but remained open during the oneyear project. When weighing capital improvements to the building, the co-op considered going solar but decided for us, the cost wouldn t be worth it, explains Bisgrove. Instead, the co-op installed a new gas compressor and rack system, energy-efficient T-8 lights and new refrigerated and frozen cases, all which helped improve energy efficiency and reduce costs. Plus, balancing the stores air vents made a huge difference, adds Bisgrove. Utility bills have decreased 30 to 40 percent. To improve the shopping experience, the co-op consulted with the same architectural firm it used a decade ago. We had grand ideas. We had plans for a side addition with an expanded deli and meeting room, notes Bisgrove. In the end, they decided against the addition, which would have taken the store s side parking lot. We are too landlocked for parking, adds Bisgrove. We did it just right, he notes, reflecting on the latest round of capital improvements. It worked out well. The project ended up being smaller in scale and more affordable. We couldn t be more happy with the results. 24 t he gou r me t retai l e r JUNE/JULY

8 deli, which is known for its chicken salad, daily roasts four to eight turkeys, which are used in its popular turkey sandwich. Bisgrove, who started working at the co-op as a bag boy when he was 17, says he s heard the same old story about the coop: All the customers are old and are doing to die. But, he notes, In fact, this is a community store, and we evolve with the times. In 1975, after working as a manager at other retailers, including JC Penney, Bisgrove returned as manager, and he s been on the payroll for the 38 years thereafter. I ve been part of the history for many years, Bisgrove notes, and is quick to add, I m not retiring. I m enjoying myself. But when that day comes, Bisgrove has been training his successor Gabree, who has been with the co-op for 20 years, to take over. My big goal is to make sure this coop goes on for another 75 years, says Bisgrove. Chaz Martel, with Delmar Sharpener, sharpens knives in-store. Niskayuna Co-op uses shelf tags to highlight natural, organic and locally produced items. Brownies & Beer? Why Not?! Seth Greenberg s NEW SOUTHWEST BROWNIE CRUNCH is the first spicy chocolate snack in the market. It s great with a beer, a cocktail or any beverage. Once again, the brownie is reinvented! BOOTH 4024 Only 120 calories per 1 oz. serving! ALL NATURAL KOF-K DAIRY MADE IN USA Available in 3 Spicy Flavors: Chipotle Jalapeño Chile Pepper NY Crunch is available in 2 NEW flavors: Orange Cinnamon Cappuccino Original flavors: Chocolate Chip Toffee Mint Chocolate Chip SETH GREENBERG S AUTHENTIC NEW YORK BROWNIE CRUNCH browniecrunch.com 275 Madison Ave, Suite 627, NY NY JUNE/JULY 2013 t he gourmet retai l e r 25