Reinventing the variety store: Hy-Vee will add beauty, fitness and clothing departments

Dive Brief:

  • A new 24-hour Hy-Vee store location in Minneapolis boasts several firsts for the company, including a cosmetics and beauty department called Basin and new grab-and-go food offerings, according to Retail Leader. The store also has a "produce butcher" who will chop, slice, dice, julienne or mince fruits and vegetables to order, according to the Minneapolis Star Tribune

  • The retail chain is also planning to open a store next year in White Bear Lake, MN that will include a fitness center, restaurants, takeout food and clothing in addition to traditional groceries. 

  • “Our store designs are evolving as we see how people shop,” Hy-Vee CEO Randy Edeker told the Minneapolis Star-Tribune

Dive Insight:

Hy-Vee is reversing Wal-Mart's direction with this new store format, transforming from a grocer to a food-seller and general merchandiser. Kroger also used to be "just" a grocer, but now operates 782 convenience stores (on its own or through subsidiaries) and 326 fine jewelry operations in addition to its 2,625 supermarkets. 

The Wal-Mart store model has conditioned consumers to expect eyeglass departments, banks and even hairdressers in big box food stores, so it makes sense that traditional grocery retailers are now venturing into this variety store space. Consumer desire for grocery "experiences" are also pushing grocers to expand their services, encouraging shoppers to linger longer in their aisles or sit and eat a meal from a prepared food station after they've made their purchases. 

Many of these in-store experiences center on providing restaurant-quality, artisinal foods, so it's interesting that Hy-Vee is venturing into different retail avenues altogether rather than bolstering existing services. 

Hy-Vee shoppers' reaction to its new store models could be telling. The store is betting that shoppers will hang around a location long enough to buy their groceries, pick up beauty products and get in some gym time before heading home. If this proves to be true, this venture could encourage similar expansions across the industry. 

Filed Under: Grocery Corporate