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More competition is moving into the Springfield grocery market, in the form of an 84,000-square-foot store that boasts a food court, health and wellness center with on-site dietitian, and its own distributing arm.

“I’ve been waiting for it,” said Randy Richards, who co-owns the Harter House at 1625 S. Eastgate. “I watched them slowly grow into the northern part of Missouri and then into Kansas City. I knew it was just a matter of time.”

West Des Moines, Iowa-based Hy-Vee Inc. plans to build a store on 14.5 acres at the southeast corner of Kansas Expressway and Battlefield Road. Hy-Vee officials said the company’s $17 million total project investment will add between 350 to 400 jobs – one-fourth of them full-time. The store could open by late 2011, said Hy-Vee spokeswoman Ruth Comer.

There are some details to contend with before it’s full-speed ahead, however.

Hy-Vee seeks Springfield City Council approval on July 12 for a cooperative agreement with the city of Springfield and the Kansas Battlefield Community Improvement District.

Council approved the formation of the CID on June 28, enabling Hy-Vee to charge a sales tax up to one-half cent to recoup the estimated $1 million it will spend making city-required infrastructure improvements, including the installation of a traffic signal at Kansas Avenue and Battlefield Road. The cooperative agreement between the city, CID and developer is standard practice after a new district is created, said Mary Lilly Smith, the city’s economic development director.

Once the agreement is approved, the grocery chain will move forward with its property acquisition from Assemblies of God Financial Services Group. Comer declined to disclose the purchase price.

Too many supermarkets?
Hy-Vee’s entrance has some people questioning the need for another grocery store. Allan Porterfield, who lives area near the proposed store site, spoke out against the CID at the June 28 council meeting. He cited the proliferation of Walmart and Sam’s Club stores and others.

“You have a Dillon’s across the street, and you’re going to be taking business away from them. There’s a Price Cutter down on Republic and Kansas,” he said. “There’s a new Price Cutter going up on the way to Battlefield. I don’t understand why we need another grocery store in Springfield.”

Among the seven regional and national grocery chains with a presence in Springfield, there are 25 stores. With a population of 157,630, according to the U.S. Census Bureau’s July 1, 2009, estimate, Springfield has 6,305 people for every store.

Some of Springfield’s existing grocery store chains also have considered the saturation of the grocery market.

Summer Fresh Supermarkets Inc. moved out of its Springfield store at 220 W. Plainview Road in fall 2007, and the eight-store chain has focused on growing its business in small towns, where it can be the exclusive grocer. In October 2008, Summer Fresh began purchasing groceries in single-store markets, including Deem’s Family Center in Carl Junction, Bear Country Market in Conway and Pendergrass Food Fair in Greenfield.

Harter House also is expanding outside of Springfield. Its $2.5 million, 25,000-square-foot Nixa store is expected to open July 8. Richards said a store inside the city limits was considered but ruled out.

“There’s strong competition,” he said. “Where there is opportunity to expand, we feel like we’ve done it.”

RPCS Inc., which owns 48 stores, including 10 Price Cutter and Price Cutter Plus stores in Springfield, has found room for expansion within the city. It’s building a 25,000-square-foot Chestnut Crossing store at Chestnut Expressway and West Bypass. A store planned for downtown Springfield, on the first floor of the former Wheeler’s Furniture building on South Avenue and Walnut Street, however, has been delayed while the chain concentrates on other priorities, according to previous SBJ coverage.

“The Springfield market is a very healthy, independent market where consumers have great choices. … Can you ever have too many choices?” said Dan Shaul, state director for Missouri Grocers Association.

Home-grown and grand
Harter House officials hope shoppers will choose to spend their money at locally owned stores.

“There’s a big push in the area to buy local,” Richards said. “It makes sense because the money you spend with a company gets put back into your economy.”

Harter House is working with Springfield’s Well Fed Neighbor Alliance to sell more local-grown goods in its stores, Richards added.

Comer said each Hy-Vee store director has the ability to order from local suppliers. The company’s distribution chain includes subsidiary companies Perishable Distributors of Iowa Ltd., which supplies meat, poultry, seafood and eggs to Hy-Vee’s 229 stores, and Lomar Distributing Inc., which supplies specialty products and organics.

“Local growers and manufacturers can go straight to the store director,” she said.
Barbara Bettlach, who with husband Jerry opened the first Harter House 37 years ago on West Sunshine Street, has noticed the stores just keep getting bigger. Her first store was
around 1,500 square feet.

“Eighty-four thousand square feet sounds huge to me,” she said, noting most of Harter House’s six stores are near 30,000 square feet.

The Hy-Vee store is larger than a traditional grocery store, but about half the size of a Walmart Supercenter’s 175,000 to 200,000 square feet, Comer said.

Within Hy-Vee’s planned Springfield square footage includes a food court with dining room, a health market department with an on-staff dietitian, specialty and organic foods and special foods for dietary concerns, a Hy-Vee Club Room with a full kitchen where cooking demonstrations and wine tastings are held; and a nonfoods section, Comer said.

The future
A new player in the Springfield grocery scene may cause ripples among local stores.

But changes already have been in the works. Price Cutter officials have said new stores are following earth-friendly building practices, and expanding the size of their organic food departments.

Harter House has plans to capitalize on its specialty meats department by launching a “steaks online” business, similar to Omaha Steaks, Richards said.

“We’ll sell our own homemade sausages and tri-tips … Kobe beef and dry-aged beef,” he said.

Hy-Vee has positioned itself as a center for health and wellness, Comer said.

“We’ve been fortunate to stay ahead of the curve,” she said. “We have customers look to us to help manage their health.”

As for Hy-Vee’s growth in Springfield, Comer said there are no immediate plans to open another location, but the company is always looking at opportunities. It has been looking at a site in Joplin, she said, but  infrastructure concerns remain.

Richards, at least, is expecting to see more than one Hy-Vee. “They do not come into a market for one store,” he said.[[In-content Ad]]

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