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>> The color and quality of lighting systems are crucial to present food, especially produce, in the best possible light at the 240 locations of Sprouts Farmers Market. Sprouting Up Sprouts Farmers Market is growing across 13 states from coast to coast at a rate of more than 30 new locations annually. By Russ Gager

s vice president of construction, procurement and facilities, Steve Ha- , , , Ten- gen is keeping busy with Sprouts Farmers Market’s 36 store open- nessee, and . “We op- ings scheduled this year. Last year, he kept busy with 32 store open- erate pretty much within those zones, ings. This pace has helped the company maintain the 14 percent and typically, we open stores across Aannual growth rate that its board of directors set as a goal when the company the entire network,” Hagen says. went public in August 2013. Some of Sprouts’ early expansion company profile “Generally, that’s the expectation – 14 percent organ- was through acquisition of chains Sprouts Farmers Market ic growth,” Hagen says. “This year, we’re a little bit above such as Henry’s Market, Sunflow- www.sprouts.com Headquarters: Phoenix 14 percent because we had the opportunity to take over er Farmers Market and Sun Harvest Employees: 24,000 Specialty: Fresh produce a few of the stores that closed and convert them Farmers Market. “Today, our current Steve Hagen, VP of con- into Sprouts stores. So that was a few more stores than we expansion is focused on reimagining struction, procurement and facilities: “We wouldn’t pass planned this year.” existing buildings or developing new up a great site over a couple thousand square feet.” Sprouts’ more than 240 stores are located in Califor- sites,” says Hagen, who has been with nia, , , , , , , Sprouts Farmers Market since 2013.

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The Right Site The company values leased locations that are good for retail- ing when deciding where to locate its stores. “Whether it’s good real estate in the area that we want to be in – whether an existing or a new building – is the biggest driving factor,” Hagen says. “Is it really the right site?” Sprouts stores usually are in a retail strip mall with parking in front, but sometimes they are freestanding. Both types of stores are acceptable, and which is used depends on which type of store is available and how good a site it is in. Sprouts’ prototype store measures approximately 30,000 square feet on a single level. “We would prefer every build- ing be our prototype, but if you find a great site where you can’t get that – it might have to be 28,000 square feet – we wouldn’t pass up a great site over a couple thousand square feet,” Hagen says. The Haggen stores that Sprouts took over were 45,000 to 50,000 square feet in size. In cases such as this, Sprouts often will use only 30,000 square feet, build a demising wall and return the extra square footage to the landlord for leasing as another store. “That 30,000 square feet would be the inten- tion for every store, but you can’t always get what you want, especially if you’re taking over an existing building,” Hagen concedes. “If it’s the right site, we can make almost anything in that 30,000-square-foot range work.”

Sprouts stores usually are in a retail strip mall or freestanding with parking in front. <<

Savant Construction, Inc. is a full service General Contractor providing ser- vices on a variety of projects throughout the Western United States. Estab- lished in 1989, Savant Construction specializes in the design and construction of commercial projects, retail centers, grocery stores, restaurants and public facilities. Our services include design-build, new ground-up construction, site work and renovations to existing sites and facilities. We are also fully versed in the construction methods required for the LEED certification process.

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A Total Gut When Sprouts takes over an existing location, it completely guts the interior down to the raw ground so it can build the store in Sprouts’ prototype design. “We just rip everything out, recycle what we can and start from scratch so we can have a store that looks right and represents a Sprouts,” Hagen says. Even former grocery stores are total- ly gutted. Underground systems such as plumbing usually have to be moved to match Sprouts’ prototype. “So that gets all torn out,” Hagen confirms. “For the most part with rare exceptions, all-new electric and plumbing is installed.” The remodeling of each store in- cludes building a new floor out of high- ly polished, integrally colored concrete with expansion joints sawed in 9-foot- by-9-foot squares. “It’s all poured as one,” Hagen says. “If you don’t put in expansion joints and sawed cuts to create room for expansion, the floor is always going to end up cracking. Con- crete cracks, but you can minimize that by putting in expansion joints.” In food preparation areas, tradition- al concrete is poured and quarry tile adhered on top. “This is to provide the typical finish you would want in a prepa- ration area for food,” Hagen says. Ceil- ings typically are open to the trusses, painted a light tan color, the ductwork left in its original galvanized color and skylights installed. “This just makes the building feel more open,” Hagen says. Most of the stores use convention- al drywall covered with finishes such as paint or a wood similar to the barn feature on the front of the stores. The HVAC systems vary, as do the climates

BRR Architecture, Inc. is a national design firm focused in the grocery, retail, hospitality, commer- cial interiors and industrial markets. Headquar- tered in the Kansas City area, the firm consists of nearly 250 professionals, and has more than 70 licensed architects. BRR has offices in Bentonville, Phoenix, San Francisco, Philadelphia, Atlanta and >> Sprouts sells fresh produce and grains from field bins, Austin, as well as satellite offices in Miami, Los barrels and wooden crates. The stores strive to inspire, Angeles and Chicago. educate and empower people to eat healthier.

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in which the stores are built. Different regions of the Unit- ed States use different types of HVAC systems, such as heat pumps in the South and swamp coolers in the Southwest. The typical time to remodel a Sprouts store is four months, and to build one from the ground up takes approximately eight months. The company hires general contractors who employ five or six prime subcontractors and from 30 to 50 smaller ones for the many small sections of the store that use the va- riety of equipment and finishes in today’s grocery stores.

Regional Differences Sprouts stores vary in the materials used to build them based on the wide variety of locations, regions and climates in which they are constructed. Most of the regions use block construction. “In Texas, they’re tilt-wall concrete,” Hagen

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says. “They always like to use tilt-wall Over the years, since Sprouts was because they do a lot of concrete.” founded in San Diego by the Boney fam- Exteriors are made up of a wide va- ily in 1943, there have been some dif- riety of different trims, from stucco to ferent store formats. The first Sprouts veneers. “It just depends on how that opened in Chandler, Ariz., in 2002, but specific site is designed,” Hagen points since then, the small-box, open-sight- out. “The finished building is often line format has not changed. New stores driven by the city planning or the re- share a similar look, although some quirements of that area. There’s also stores open to the right or left. a wide variety of finishes in the stores “We try to model that prototype lay- based on the area.” out as much as possible,” Hagen says.

>> Sprouts offers natural, local and organic foods at favorable prices in a setting that feels like a farmers market.

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“We just rip everything out, recycle what we can and start from scratch so we can have a store that looks right.”

“There will be times when you can’t Food Fixtures do that and you have to be creative be- Sprouts Farmers Market makes sure its cause the store isn’t prototypical, but stores use energy wisely. Its skylights overall, we try to make them very much reduce the use of artificial lighting. The the same and keep the same authentici- stores’ refrigerator and freezer units ty of design.” have doors and are operated by effi- cient energy management systems, as Natural Foods are the air conditioning units. “We make Sprouts sells fresh produce and grains sure the refrigerated units, freezers and from field bins, barrels and wooden air conditioning system operate at the crates. The stores strive to inspire, ed- highest efficiency,” Hagen emphasizes. ucate and empower every person to Insulation is applied to the walls and eat healthier and live a better life. The ceilings, and all the glass used exten- company is committed to providing sively at the store entrance is insulated. its customers with affordable, healthy The color and quality of lighting sys- foods and friendly, knowledgeable and tems are crucial to present food, es- engaging service every day. pecially produce, in the best possible The stores offer fresh, natural, local light. The company is testing LED light- and organic foods and products at favor- ing in some of its stores. “We’re retro- able prices in an approachable setting fitting a few stores to see what kind of that feels like an old-fashioned farmers performance we get,” Hagen says. “We market. Low shelving allows customers have one new store that is designed to see the whole store from the entrance with LED lighting. The biggest part of and throughout the store. Spacious aisles efficiency is with the skylights. We can and bright natural light evoke the feeling turn off most of the lighting during a of an indoor farmers market. good part of the day.” The stores feature colorful, fresh fruits and vegetables, barrels of grains, Multiple Sources nuts and sweets, and full-service deli, Sprouts tries to retain the spirit of its or- meat and seafood counters, complete igins in farmers’ markets with its décor, with handcrafted burgers and sausages. which favors real wood in its fixtures Fresh baked goods, ready-to-eat and barrels. “We have a higher amount meals, gourmet cheeses, vitamins, of real wood than a typical grocery supplements and thousands of natu- would because we’re more focused on ral, organic and gluten-free grocer- produce and fresh food,” Hagen asserts. ies are supplied to each store. The company says its buyers go to great SolSource Logistics assists organizations with lengths to source new and unique, their new construction and remodel projects by managing and executing the delivery of top-quality items on a regular basis. furniture, fixtures & equipment. Within multiple industries, SolSource supports the purchasing Sprouts-branded products are sprin- and construction teams and provides a guaran- kled throughout its stores. teed freight savings.

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“People can tell when it’s real wood, even if they don’t know a lot about wood,” Hagen maintains. “When peo- ple walk into a store, they don’t see everything the way I do, but they know how the store makes them feel – the am- biance. Part of that is whether it feels fake or authentic, and inherently most people feel that the wood is authentic, even if they don’t articulate it.” Those wood fixtures in produce and the bakery and bulk departments are supplied by JSI. Plywood is used in the produce department and primarily ma- ple wood for other areas. Unlike a traditional , produce is located in the center of a Sprouts instead of being off to the side when customers first enter the store. “One of the key features in a Sprouts store is that you can see all the way The company recently launched from the front to the back of the store,” a software program called Places in Hagen notes. “The customers comment which all the manufacturers that ship that it is one of their favorite things Sprouts products put in their invoices about the stores.” and the production managers verify The only sections where merchan- that the items have been received. dise is stacked above eye level is along The procurement team obtains all the the perimeter of the stores where dry fixtures and equipment used to remod- goods, health, beauty and vitamin prod- el Sprouts’ stores for all the locations, ucts and the refrigerated and freezer many of which are being remodeled cases are located. concurrently. The team also handles procurement of items that are not for Supply Chain resale, such as plastic bags to bag gro- Scott Coleman is Sprouts’ certified ceries, containers to place bulk and procurement manager and handles fresh food in, cleaning and office sup- procurement of construction materials, plies and small wares, such as plastic store merchandise and supplies. “Many spoons and knives used in the deli and times, we’ll have more than one source bakery departments. for a product, but if the companies are “We typically have agreements with strong and have multiple distribution people that go across all the regions,” and manufacturing points, then we’ll do Hagen says. We try to find some suppli- a single supplier,” Hagen says. ers that have multiple manufacturing fa- cilities spread across the United States so we minimize the distribution cost.” C-3 IS Inc. has been a proud partner of Sprouts Farmers Market since 2004. Sprouts’ tremendous growth has allowed us to grow along with them, Just-in-Time Delivery providing multiple services to clients across the country. For structured cabling, video surveil- Arrival of construction materials usu- lance, audio/visual, and Telco systems, trust C-3IS, Inc. to design, implement, and support your ally is delayed if a project is behind ideal communications infrastructure. schedule. However, “for the most part,

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In Sprouts stores, customers can see all the way from the front to the back. << construction materials arrive just in time,” Hagen says. “Oc- casionally if a project is behind, some materials might get shipped and have to be stored, but that would be the respon- sibility of the contractor to safe harbor it somewhere until we’re ready for it.” Storing construction materials outside can affect their quality. “We don’t want them sitting outside where they could get rained on or heated up,” Hagen emphasizes. “Being cov- ered in plastic is not good for equipment. We make the con- tractors put it in a warehouse somewhere where it can be stored. For the most part, everybody does a pretty good job of managing that. There have been very few times when we have to hold equipment.” Often, suppliers can delay delivery of construction ma- terials or equipment if they are notified in advance of a delay in construction. Sometimes, steel fabrication can be delayed, or if construction materials or fixtures are already manufactured, with the number of Sprouts stores always be- ing remodeled, the materials or fixtures can be shipped to another Sprouts store that might need them right away for its remodeling. “The vast majority of the construction materials and fix- tures is the same equipment,” Hagen declares. For example, the stores all use the same metal shelving. Despite the rate of expansion and organic growth always increasing, the goal of Sprouts never changes. “Our goal is always to offer great value and strike the right balance between quality, flavor and price. But most importantly, your safety is our priority,” the company says.

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