| Type | Subsidiary |
|---|---|
| Industry | Food wholesale |
| Founded | Jones Brothers Tea Company, 1872 |
| Key people | Rick Cohen, Chairman & CEO Chris Kreidler, Executive VP & CFO |
| Parent | C&S Wholesale Grocers |
| Website | Grand Union Family Markets |
Grand Union is a supermarket chain operated by C&S Wholesale Grocers of Brattleboro, Vermont. Originally based in Elmwood Park, New Jersey (later moving to Wayne, New Jersey), the company operated mostly in the northeastern United States but at times its reach extended into the Midwest, Southeast, and the Caribbean. Currently, the chain is known as Grand Union Family Markets, and has 26 locations (20 in New York, 4 in Vermont, 1 in Connecticut, 1 in Massachusetts), chiefly in rural communities.[1]
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Grand Union started as the Jones Brothers Tea Company in 1872. By the 1930s it was one of the largest grocery chains in the United States.[2] The name "Grand Union" was inspired by the desire to "unite shoppers with low prices in a 'Grand Union of Value'" as described by company associate Elvin Sanders. The store's mascot was Abraham Lincoln wearing a deli apron, and most stores featured a costumed Lincoln to accomplish deeds, talk to customers, and proclaim the general splendor of the Grand Union, and to urge them to "Save the Union" when the company faced economic hardship. Starting in 1960, the company also operated "Grand Way" stores which were similar to today's super-centers as they combined a discount department store with a grocery store all under one roof. The grocery stores were later separated from the discount stores and sold to Winn-Dixie/Kwik-Chek.
British corporate raider Sir James Goldsmith acquired Grand Union in the early 1970s. Grand Union was a money loser during much of Goldsmith's time of ownership. The company, which was then a national chain, was forced to sell over most of its stores outside of the northeastern states during the early 1980s, such as its Florida, Texas, and Washington, D.C. divisions. (However, the company did retain the Big Star Markets chain operating in the Atlanta metro region up until 1993). In the 1980s it acquired many former A&P stores in northern New Jersey. In the mid 1980s, Goldsmith brought in former Target Corp. executive Floyd Hall to manage the chain. Goldsmith also had world-renowned artist Milton Glaser complete a graphical redesign of the chain, which included the "red dot" theme. Through the new management under Hall, the chain was able to make record making profits for once throughout the late 1980s. Goldsmith sold the chain to Floyd Hall and a group of investors in 1988. The chain, however, was quickly resold.
In 1989, investment banker Gary D. Hirsch, a partner in the firm Miller Tabak Hirsch & Co. acquired a portion of the Grand Union Company with Solomon Brothers. Hirsch had been looking to assemble a grocery empire on the east coast at the time, as he had also recently acquired Penn Traffic of Johnstown, Pennsylvania, P&C Food Markets of Syracuse, NY and the Big Bear Stores Company of Columbus, OH in hostile takeovers. Hirsch assumed the position of chairman while Joseph McCaig became CEO. Floyd Hall left upon the acquisition. Under Hirsch's reign the company had been driven into serious debt and ran out of the necessary capital for store improvements and upgrades, making it difficult for them to compete with other better financed retailers. Still, gradually, Grand Union remodeled most of their stores. Some of their older, run down stores were closed and converted to other uses. Grand Union's big disadventage was that their average store was 35,000 square feet while most supermarkets being built were over 50,000. The company did build a few larger stores as well. Financial problems plagued the company into 1995. The company then entered its first bankruptcy under Chapter 11 in 1995 and exited in 1996. After the reorganization, Hirsch resigned and sold off his stake in the company. The company continued remodeling remaining older stores.
In 1997, Grand Union brought in the well-respected former A&P and Kroger executive, J. Wayne Harris to begin a turnaround of the ailing chain. Nearly every store that had not already been remodeled went through remodeling and grand reopenings. This built even more debt on the company which entered bankruptcy again in 1998. Early in 1999, the Company emerged from bankruptcy with more than $175 million in cash to spend in the stores. The company also acquired building permits to build some larger stores to compete more effectively. Harris used the cash to finish the last remaining remodels and experiment with new store formats, such as "Hot Dot", a limited assortment store in the mold of Aldi and Save-A-Lot, "Grand Union Fresh Markets", an upscale gourmet concept, and "Mega Save", another discount format. Cash quickly dried out as a result of overspending in new stores and reformatting of existing stores. None of the new concepts worked and Harris was forced out of the company in 2000. He was then hired by JC Penney to oversee a turnaround of the Eckerd Corporation, which experienced similar results a couple of years later. Some of the construction permits began to result in the building of new stores. Others started but stopped due to lack of funding. One new store built in Fishkill never opened and in the end was sold after the exit of the market to a Shop Rite owner. Harris left Grand Union with unbearable debt, crumbling sales and a desperate deal for cash with a wholesaler that forced the company back into bankruptcy in 2000. At this point, Grand Union lacked funds to even operate so their bankruptcy was converted to a Chapter 7 liquidation in December of 2000. Stores continued to hang on through the year.
C&S Wholesale Grocers, a New England-based wholesale food distributor, now one of the largest in the nation, faced a huge loss of revenue because Grand Union was its largest customer at the time. [3]
C&S was owed huge money by Grand Union so they reposessed the entire Grand Union chain, bringing it out of bankruptcy and immediately began working to consolidate Grand Union's operations after making a stalking horse offer. This involved exiting the New York metropolitan area market, where it had done the core of its business, altogether. Most of the larger stores and a decent amount of construction permits were sold to Ahold, who converted them into Stop & Shop stores as part of that company's continued expansion into the New York metro area. Others were bought by competing chains such as Shaw's in Connecticut and Massachusetts, Hannaford in upstate New York and Vermont, and several would be sold to Pathmark in New Jersey. A few stores were sold to independent grocers. Many of the smaller stores, though were purchased by Eckerd (later becoming Rite Aid stores). The rest that weren't sold to competing supermarket or drugstore chains were converted for other retail use or (at least in the case of the former flagship store in Elmwood Park, New Jersey, where the original corporate headquarters was located and where the office tower attached still stood) demolished and replaced with other buildings.