Dive Brief:
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H-E-B, which has a market-dominating presence in much of Texas, is the state's largest private employer with more than 90,000 employees — referred to as partners — in 332 Texas stores, plus 10,000 partners in 56 stores across northeast Mexico, according to an article in Progressive Grocer.
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When the company announced in late 2015 a new employee ownership plan, 55,000 employees were immediately eligible – and their number keeps growing. Eventually, some 15% of the company's stock will employee-owned.
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Tina James, H-E-B's senior vice president of human resources, told Progressive Grocer that, “In business and life, people matter most.” This philosophy has shaped H-E-B for 112 years and reflects why employees are called partners: “Because we work together to achieve success and create a strong sense of pride within our stores and throughout the more than 300 communities we serve.”
Dive Insight:
On Deloitte Touche Tohmatsu and STORES Magazine's list of the top U.S.-based companies that are the world's largest retailers, Wal-Mart is — hardly surprisingly — number one. Much more surprising is Number 46 on the global list: H-E-B, which operates in one American state and a chunk of northeast Mexico.
In terms of consumer popularity, H-E-B ranks third on dallasnews.com's Texans' favorite grocers list – but never mind that: Bloggers such as Paste Magazine and The Austin American-Stateman's austinblog are only slightly more enthusiastic than the American Customer Satisfaction Index, which last year ranked H-E-B number 4, tied with Wegmans, after Trader Joe's, Publix and Aldi.
Among customers' for loving H-E-B are the quality of its thousands of H-E-B-branded items (some of which are Texas-shaped, and many of which are local), commercials featuring the San Antonio Spurs, the company's mascot H.E. Buddy (which one shopper described as “a walking, talking, smiling bag of groceries”), a good selection of Mexican candy, the tortilla stand in the middle of the store, team gear for local high schools and universities, and an ongoing promotion called Combo Loco, requiring fun hunts for various items to earn special discounts on all of them.
As one would expect, given the size of the state and its varied population, Texas has a lot of grocery stores. H-E-B's largest competitor, in terms of store numbers, is Wal-Mart, with around 300 supercenters. Other large state chains include followed by Kroger, with more than 250 stores, and Brookshire Grocery Company, with 151 stores.
H-E-B meets those different formats and operating styles by making shopping fun and interesting, and by setting out to offer every type of food items they might conceivably want plus expanded sections — including home and kitchen, pets, health and wellness, baby, toys, electronics, office and school and flowers. A wide range of eat-in or take-out restaurant formats serve shoppers in various stores, too. That's an example of H-E-B being smart enough to know that some experience can be grown, but some should be brought in, from seasoned practitioners.
In more than 110 years in the Texas grocery space, H-E-B, still owned primarily by the Butt family, has learned a lot, including how to play its Texas roots to the hilt. It's won over shoppers and its dominance in the Lone Star State is likely to continue unchallenged.