Hy-Vee builds out infrastructure as it adapts to customer needs
Hy-Vee has outlined its plans to bolster its in-store and fulfillment offerings, announcing renovations and new facilities across the retailer’s eight-state footprint. The West Des Moines, Iowa-based company said that its efforts are aimed at adapting its offerings to meet customers’ changing lifestyle needs.
“This fiscal year, we have approved one of our largest capital expenditure budgets in our company’s history to make sure we are not only meeting our customers’ needs, but fulfilling their wants, now and in the future,” Hy-Vee chairman, president and CEO Randy Edeker said. “We’ve studied customer habits and lifestyles and know that fewer people are cooking meals at home than ever before. We want our offerings to help individuals who are looking for something healthy to eat on the go as well as families who want to enjoy a sit-down meal that they can easily claim as their own.”
Among the projects currently taking place is the construction of a 240,000-sq.-ft. production facility in Ankeny, Iowa that will serve as the company’s central bakery as the company moves to offer more meal kits and fresh prepared options. The Ankeny expansion also will see the expansion of Hy-Vee’s PDI distribution subsidiary, the company said. In Chariton, Iowa, Hy-Vee is building a 48,000-sq.-ft. production facility adjacent to its current distribution center there, with plans for the new facility to support its Short Cuts produce brand that will launch in 2018. Hy-Vee also is constructing its new Fast & Fresh convenience and meal solutions banner in Des Moines and Davenport, Iowa, with West Des Moines set to see another small-concept store in 2018, according to the company.
Hy-Vee also said that it plans to open three new e-commerce fulfillment centers in Kansas City, the Twin Cities and Omaha, Neb., which the company said would allow it to meet the growing online ordering needs of its consumer base.
As it builds out its distribution, production and fulfillment, Hy-Vee said it would be revamping its Hy-Vee Market Grille Restaurants, turning them into Market Grille Express locations, which is aimed at catering to on-the-go consumers. Each Market Grille Express location also will include a full-service bar. The company said that it would soon make an announcement about the first of 26 planned Wahlburgers restaurants, and that it would be communicating with its shoppers via direct mail more.
Albertsons expands with El Rancho Supermercado investment
Grocery retail chain Albertsons has announced plans to invest in a Texas-based supermarket named, El Rancho Supermercado. The retailer focuses on stores for Latino customers, and will continue to operate as an independent company as part of the deal.
“El Rancho has built a great business with its 16 Texas stores, and we’re confident that we’ll be able to leverage our combined expertise to better serve customers across the existing Albertsons Companies’ and El Rancho store bases,” Bob Miller, chairman & CEO of Albertsons said. “With El Rancho’s own distribution and manufacturing facilities serving their Texas stores, we can share best practices that will reduce costs and benefit our customers.”
This investment will allow Albertsons to invest in the fast-growing Latino grocery sector, and together the two companies believe they will be able to leverage their strengths to better serve customers. The Idaho-based retailer already operates stores across 35 states under 20 well-known banners.
“The transaction announced today will allow El Rancho to accelerate growth and expand into new markets throughout Texas, while finding operational efficiencies in all aspects of our business. We are aligned with Albertsons Companies’ vision for the future, strategic initiatives and culture of innovation. We are excited to work together with the Albertsons Companies’ management team to continue to serve families in the rapidly-growing Latino market,” Salah Nafal, president of El Rancho, said.
Peter J. Solomon served as financial advisor, Simpson Thacher & Bartlett served as legal advisor to El Rancho and Schulte Roth & Zabel served as legal advisor to Albertsons.
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