2019 Retail Pacesetters: Hy-Vee moves in new format directions

With deep roots going back to the 1930s, West Des Moines, Iowa-based Hy-Vee is an employee-owned company operating more than 245 retail stores across eight Midwestern states with sales of $10 billion annually. The supermarket chain is known for its quality, variety, convenience, healthy lifestyles, culinary expertise and customer service. It also was named Drug Store News2018 Retailer of the Year.

Hy-Vee often is lauded for its customer service and management style. The importance of providing “A Helpful Smile in Every Aisle” is ingrained in the company’s 80,000-plus employees on day one. Hy-Vee store managers are given significant control over store operations, including pricing, promotions, merchandising and policies.

Known for its large-scale format, the company has been shaking things up in the Midwest with its new convenience-focused, smaller-store format, Fast & Fresh. The 10,000-sq.-ft. stores feature on-the-go meals, sushi, wood-oven pizza, Starbucks coffee, a growler craft beer station and Hy-Vee Aisles Online pickup for convenience on the go.

The company also launched its first Hy-Vee HealthMarket, a freestanding concept store with a focus on sports nutrition and supplements, fresh produce, meat and dairy items, meal kits, frozen foods, and a healthy beverage station. The store also features a pharmacy and hearing center, and an Aisles Online pickup location. The nearly 17,000-sq.-ft. store also has high-end cosmetics and offerings from Basin natural beauty and body care. Adjacent to the store is an Orangetheory Fitness studio. The West Des Moines location is said to be one of 60 the company plans to launch in the coming years.

At the same time, Hy-Vee has turned its attention to expanding its pharmacy operations, acquiring several pharmacy retailers, including all Weber & Judd locations in Minnesota, which were rebranded as Hy-Vee HealthMarket Rx locations. The locations offer traditional pharmacy services, free prescription delivery, automated refill ordering, immunization services, free blood pressure checks, private medication consultations and a registered dietitian for nutritional consultations.

In February, Hy-Vee acquired several Shopko pharmacies in the Midwest. These six pharmacies are in addition to the 22 Shopko pharmacies that Hy-Vee acquired in December 2018.

“Hy-Vee is a standout retailer in providing health-and-wellness solutions,” said David Orgel, a principal with David Orgel Consulting based in Westfield, N.J. “Increasingly, consumers are demanding health solutions, and Hy-Vee is on the leading edge,” Orgel said. “The company is a master at leveraging dietitians, pharmacists and in-store health clinics to raise its profile as a wellness provider. To complement this, Hy-Vee merchandises a wide range of natural, organic and allergen-friendly products in its store. The retailer has made impressive strides with its total-store health strategy and even extends efforts beyond stores into communities.”

Hy-Vee has been developing a partnership with restaurant franchise Wahlburgers and plans to build, own and operate 26 Wahlburgers restaurants. In addition, Hy-Vee sells Wahlburgers-branded menu items at its full-service Hy-Vee Market Grille restaurants in the Minneapolis and Des Moines, Iowa markets.

This story is one of 20 profiles of retailers who are making a difference in the industry. To read more, click here