Hy-Vee Expands Into the Twin Cities

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Hy-Vee expands into the Twin Cities

September 24, 2015

NEW HOPE, MN — More than 100 shoppers waited excitedly in the drizzling rain at 6 a.m. Sept. 22 for the doors to open so they could get a peek inside the much-anticipated first Hy-Vee supermarket here. After nine months of construction and a cost of more than $27 million to build, furnish and stock the 90,738-square-foot store, it did not disappoint. The roughly 9,000-square-foot produce department contains 1,100 items, including 125 organic and 35 homegrown.

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Alex Chambers, produce manager, stands in front of Hy-Vee’s homegrown produce 'work of art' display and anticipates a busy first day during the opening of Hy-Vee’s New Hope store in Minnesota.

Simultaneously, another nearly identical Hy-Vee store opened about 30 miles away in Oakdale, MN, ushering in the Iowa-based, employee-owned company’s expansion into the Twin Cities marketplace.

More stores are scheduled to open in the Twin Cities in 2016 — one in Brooklyn Park and one in Lakeville — with two others are on the docket. The grocer is aggressively targeting the area and plans to open four to five stores each year in suburban Minneapolis-St. Paul locations.

“It’s a big day for New Hope, a big day for Hy-Vee,” said Mayor Kathi Hemken at the ribbon-cutting ceremony.

Tony Taylor, store director at Hy-Vee New Hope, told The Produce News that the store’s opening

exceeded expectations. Hy-Vee offers around 125 organic produce items at its New Hope, MN, store.

“We knew they’d be very receptive, we just didn’t know how much,” said Taylor. “The fact that we had a full parking lot, with people circling the lot for 30 minutes trying to find a parking spot, spoke volumes.”

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These aren’t the first Hy-Vees in Minnesota; there are already 17 in the southern part of the state, but it will be the company’s largest market by population. It will face tough competition from local grocery leader SuperValu’s Cub Foods in addition to Lunds & Byerlys, Kowalski’s, Whole Foods, Trader Joe’s, Aldi, Coborn’s, Walmart, Target and local co-ops.

Yet Randy Edeker, Hy-Vee’s chief executive officer, sounded confident when he said in a past interview, “Once we announced we were going into the Twin Cities I had lots of notes from mayors up there saying ‘build here please.’ We do have a large Midwest following. We have no illusions that we will all of a sudden kick the door open and open 20 stores. We don’t do it that way. We’ll have a steady, gradual growth.” And Edeker predicted to the StarTribune in July, “We see this as being our

largest market someday.” Exotic fruits and melons from all over the world abound in the New Hope, MN, Hy-Vee’s colorful produce department.

So what exactly will set Hy-Vee apart from all of its competitors?

“Our customer service,” spokeswoman Tara Deering-Hansen said in an interview. “Every employee is trained in friendliness. We are all trained to focus on that customer standing right in front of us. We feel you can’t get that anywhere else.”

Taylor agrees that Hy-Vee’s people make all the difference.

“There’s a lot of great companies out there that probably have really good produce, but I think there’s a lot of times where your people, their expertise, their knowledge, being able to tell the customer what the right way to pick out a great pineapple, or cantaloupe, or whatever it may be — just having those experts in place makes a world of difference,” Taylor said.

Another competitive advantage, according to Taylor, is the fact that they “create art with

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produce.” John Earley, assistant produce manager at the New Hope, MN, Hy-Vee, checks the banana display after a hectic day in the new, nearly 9,000-square-foot produce department.

“We don’t just stack it out there like your average retailer,” said Taylor. “We want to have the freshest product, we want to have local and homegrown, but we want to create an impact when you walk in and you’re just amazed — like, ‘I just saw Picasso create this piece of art with all this produce.’ That’s why you see a rainbow of produce and angles and different things. We want to sell a lot of produce but I think that you have to make it a ‘wow,’ and produce in Hy-Vee makes it a wow.”

Not to mention the sheer size of the stores and the variety of offerings as further distinguishing factors. Hy-Vee stores are about 50 percent larger than Cub Foods stores, plus Hy-Vee offers one- stop shopping convenience with a full-service restaurant with bar and outdoor dining; a pharmacy with drive-up window; an in-store express clinic; dietitians and wellness department; full-service floral and design shop; made-to-order salad and sushi bars; certified wine, beer and spirit specialists as well as a wine-tasting area; in-store chefs and cooking demonstration stations; HealthMarket and bulk foods sections; one entire aisle dedicated to gluten-free foods; mother’s rooms; Starbucks coffee kiosk; dry cleaning and postal service; Minnesota Vikings and University of Minnesota Gophers swag; baby clothes and pet-care items — plus the stores are open 24 hours a day, seven days a week.

Together the two new Hy-Vee stores have provided over 1,000 jobs to the Twin Cities area. The New Hope Hy-Vee hired more than 550 new employees, about 450 of them local teens and young adults.

“When you take 450 of your kids, and get them into jobs and train them to be good, productive citizens — it’s amazing,” Mayor Hemken said.