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Supervalu Pulls Sunflowers

Bob Vosburgh January 28th, 2008

Late Friday Supervalu announced they would be shuttering the Sunflower Markets concept it introduced with fanfare just about two years ago. There are five stores currently operating: three in Ohio, and one each in Chicago and Indianapolis. All will close the week of Feb. 18, according to a brief story in the Ohio publication, Business First of Columbus.

While a surprise, it’s not really a shock. During Supervalu’s July 2007 quarterly conference call, president and CEO Jeff Noddle alluded briefly to Sunflower’s performance, and seemed less than enthusiastic about it.

“We certainly like the concept, but the playing field has changed a little bit, and we have to evaluate whether a separate, distinct format is the right way to address it or if incorporating it more into traditional stores is a better path,” he told analysts.

Well, management has evaluated the situation, and the decision dovetails nicely with the company’s new enthusiasm for its Premium Fresh & Healthy remodeling program, which Noddle touted during the most recent call just last week.

“We are pleased with our early remodel performance and plan to maintain our commitment to the important remodel program, increasing our major remodels in fiscal 2009 to 165 stores, up from fiscal 2008’s 125 store remodels,” he said.

We don’t know exactly what management’s expectations were, though Supervalu spokeswoman Haley Meyer said the Sunflower wasn’t meeting company expectations. It’s a shame the Sunflower concept didn’t work. It represented an unprecedented commitment to the idea of a stand-alone wellness format, and marked an exciting departure from conventional retail thinking. Supervalu took a big chance. Publix has been moving much more slowly in opening its long-delayed GreenWise units, and Bashas’ has christened a single Ike’s Farmers’ Market.

We’ll leave the discussion over why this happened to you, but be assured shoppers will be seeing the more profitable elements of Sunflower in new and remodeled Supervalu-owned stores going forward.

2 Comments to “Supervalu Pulls Sunflowers”

Sam Horton Says:

January 28th, 2008 at 4:17 pm

It is interesting to think that Supervalu’s decision to withdraw the Sunflower concept was based on the “competitive” landscape. What is more competitive than grocery retail? Well maybe telecom, but to think that is the reason given, leaves one to wonder.

I think retailers oftentimes chase the next big fad, and/or go in half-heartedly to a new concept with the same old ways of doing things, and are not committed. Health, Wellness and Fresh is more than nice wooden floors, lighting and a few Natural and Organics. It is a way of life, and a reality long-time coming.

If you are not committed, then stick to your knitting and you will be successful. In Supervalu’s case, that may be the best regional/independent chain operator with the combined resources of a very large chain.
Bob Vosburgh Says:

January 29th, 2008 at 8:14 am

You make a good point Sam. Supervalu went into this gung-ho, siting units and opening them in pretty short order. Yet demand for these stores was soft. Perhaps it was a lack of research, or as you believe, maybe Supervalu is just showing impatience with the ROI. Put another way: Compare Supervalu to Publix, which took more than a year between announcing a stand-alone Greenwise store and actually opening it. In that same amount of time there were five Sunflower Markets just about up and running.