Nugget Markets
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| Nugget Markets, Inc. | |
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| Type | Private |
|---|---|
| Founded | 1926 |
| Headquarters | Woodland, California |
| Key people | Gene Stille, Chairman Eric Stille, CEO Greg Stille, President |
| Industry | Retail (Grocery) |
| Products | Grocery |
| Revenue | 221 million USD (2004) |
| Employees | 1,200 |
| Slogan | "Great Prices, Superior Quality" |
| Website | www.nuggetmarket.com |
Nugget Markets is a family owned, upscale supermarket chain operating within the greater Sacramento metropolitan area. It is headquartered in Woodland, California. As of March 2007, the company operates 7 of its flagship Nugget-brand stores as well as 3 Food 4 Less franchises.
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[edit] History
Nugget Market was founded in 1926 by the father and son team of William and Mack Stille. Their store was located in the heart of downtown Woodland, California. Mack ran most of the day-to-day operations and helped pioneer many new concepts, such as incorporating meat departments into the grocery store, installing refrigerated produce cases (built by his father) and employing checkout stands equipped with take-away power belts. The company also gained notoriety for its progressive, employee-friendly attitudes, providing its associates with some of the top wage and benefit packages in the industry.
[edit] Expansion outside Woodland
In the late 1970s, under the leadership of Mack's grandson Eric, the company began its expansion outside of the local Woodland community by opening a Nugget store in neighboring Davis. In 1984, Nugget acquired a pair of Sacramento Alpha Beta Stores and converted them into Nuggets - one in the Greenhaven-Pocket neighborhood, the other in Foothill Farms. All Alpha Beta associates were invited to join the company and many continue to work with Nugget today. In the early 90s, Nugget opened its first Food 4 Less franchise in Vallejo, California.
[edit] "Fresh to Market"
Beginning in the late 90s, Nugget overhauled its marketing strategy with a new "Fresh to Market" concept. European-style open air marketing were paired with higher end products and specialty departments such as a Full Service Kitchen, Natural Living Department, and a Juice and Espresso Bar. Thus began an aggressive push to open new locations. In 2001, the company launched its first "Fresh to Market" concept stores in Vacaville's Browns Valley Marketplace and a North Davis location at Oak Tree Plaza.
"Fresh to Market" emphasized a more artful approach to grocery marketing, with elaborately designed product displays, classical exterior architecture, a contemporary approach to interior design, and heavy use of natural sunlight. The "Nugget Tower" surrounded by statues of a robed woman with a basket of food above her head is a signature architectural feature at the entrance of its newest stores. The robed woman, casually dubbed the "Market Mom", is now both the corporate logo and the mascot of the company. An artistic rendition of the statue with the tagline "Fresh to Market - Where Quality & Price Matter" has replaced the classic, double-hoop Nugget logo in much of the corporate branding.
[edit] Points of difference
Nugget continues to struggle against its image as an exclusive, upscale grocer due to its specialty products and upscale store decor. Nugget identifies dominant local grocery chain Raley's & Bel-Air as well as national chains Safeway and Whole Foods as its primary competition.
To differentiate themselves from the local competition, they are the major regional distributor of several high quality, specialty brands such as Boars Head Deli Meats [1], Harris Ranch Beef [2], and Equator Coffees [3]. Nugget supports local produce growers with its partnership with NorCal Produce of West Sacramento, California. Signs throughout their stores tout these partnerships and the quality of the products as key points of difference to shop at Nugget.
Nugget has also continued its stance on exceptional employee benefits, with wages and benefits meeting or exceeding those of its competition. Strong benefits coupled with a positive work environment and responsive leadership have allowed Nugget to remain a union-free workplace. Fortune has recognized Nugget Markets twice in a row as one of the 100 Best Companies to Work For. In 2007, the company placed 13th. [4]
Nugget continues its push to open new stores in the Sacramento and North Bay regions. New locations are under construction in Elk Grove and El Dorado Hills. There are also tentative plans for Nugget to build a unique, significantly smaller size store under the K Street Mall revitalization proposal of Hank Fischer/Evergreen Developments. The K Street location would likely be half the size of a traditional Nugget store and, given the nature of the proposal, more focused on their Full Service Kitchen, Bakery, and Juice Bar. [5]
[edit] "Price Challenge"
Because of the breadth and quality of merchandise they carry in their stores, there is the perception that Nugget is expensive and overpriced. The company has attempted to tackle this problem through their "Price Challenge", where they provide a random customer $100 to purchase groceries at a competitor, only to bring the groceries back and see who has the lowest price. If Nugget loses, the customer receives double the difference plus $10.
Nugget also publicizes its own internal team of price checkers who weekly go to competitors to check their prices. All Nugget-brand stores have a "Price Challenge Scoreboard", designed to resemble a baseball scoreboard, with a tally of wins and losses against their competitors.
[edit] Criticism
When conducting a Price Challenge, the associate or the customer is instructed to purchase goods at the regular price - thus no club card discounts. The discrepancy comes when and if a competitor's regular price is higher than Nugget's regular price but the sale price is lower than Nugget's sale price.
Nugget stores also had the habit of repackaging products made by third party vendors, relabeling the item with Nugget specific codes and labels and similarly increasing the price. However, this practice no longer continues as the company has moved more product preparation in-house.
[edit] Vallejo Store Controversy
Given the company's success with the Food-4-Less store, in 2003 Nugget began plans to open a Nugget in Vallejo as well. The company sought assurances from the city that a supercenter store would not enter Vallejo, and these fears were seemingly assuaged when Wal-Mart built a supercenter several miles away in American Canyon. Development began on a Nugget and a propery was selected.
In 2005, Wal-Mart made clear its' intention to build a Supercenter in the White Slough neighborhood, on the location of a former K-Mart. Given the proximity of the proposed Supercenter to the existing location in American Canyon, as well as the guidelines of the neighborhood plan preventing the construction of a store of this type, the plans for the Nugget in Vallejo continued. However, President Eric Stille made clear to the Vallejo City Council that the approval of the Vallejo Wal-Mart would effectively mean the end of the Vallejo Nugget.
In November 2006, with construction already underway at the Vallejo Nugget location, Stille announced the company would no longer build a Nugget in Vallejo, citing a City Council deadlock vote on whether to approve the Vallejo Wal-Mart. Stille stated that with the construction of a Vallejo Wal-Mart, there simply would not be enough grocery dollars in Vallejo to make a Nugget financially feasible.
His comments and actions resulted in a backlash from the city residents. Supporters of the Vallejo Nugget cited the lack of upscale grocery options in the city, and the need to head down into the East Bay or up to the Vacaville Nugget for gourmet goods. Opponents derided Stille's actions as unwarranted, claiming that Nugget feared that its customer service or products would not be good enough for Vallejo consumers. Others accused the Nugget of trying to blackmail the city in order to maintain their virtual monopoly on discount grocery goods in Vallejo. [6][7][8][9]
[edit] Locations
[edit] Active Nugget Market stores
- Downtown Woodland - 157 Main St., Woodland, California
- El Macero - 409 Mace Blvd., Davis, California
- Lake Crest - 1040 Florin Rd., Sacramento, California
- Southport - 2000 Town Center Plaza, West Sacramento, California
- Park Plaza - 771 Pleasant Grove Blvd., Roseville, California
- Browns Valley - 130 Browns Valley Pkwy., Vacaville, California
- Oak Tree - 1414 E. Covell Blvd., Davis, California
[edit] Active Food-4-Less warehouses
- 5184 Sonoma Blvd., Vallejo, California
- 451 Pioneer Rd., Woodland, California
- 3333 Coach Ln., Cameron Park, California
[edit] Defunct stores
- Riverside - 6419 Riverside Blvd., Sacramento, California
- Hillsdale - 5731 Hillsdale Blvd., Sacramento, California
[edit] Proposed stores
- Elk Grove 7101 Elk Grove Blvd.
- El Dorado Hills 4500 Post St.
[edit] External links
- Nugget Markets website
