He only operated one grocery store, yet his legacy as arguably the greatest independent retailer of all-time is hard to dispute.
In a career that spanned more than 60 years, Tom Infusino, despite his modest record as an owner/operator, was the soul of perhaps the greatest collection of independent retailers of the past half century – Wakefern Food Corp.
Infusino literally epitomized the essence of the nation’s largest co-operative grocery wholesaler since 1953 and his indirect history with the co-op dates back to the mid-1940s when he and his brother Chuck opened their first grocery store in Newark, NJ with a loan co-signed by Sam Aidekman, one of Wakefern’s co-founders.
In 1953, Infusino opened the Nutley Park (NJ) ShopRite and joined Wakefern. That marked the beginning of a great marriage. It became evident early on that Infusino’s gift for teaching and team building were very well suited to help the emerging wholesaler grow. And there were other titans involved in Wakefern’s early success, too – Saker, Sumas, Romano, Glass, Gladstein, Tully, Wolfson, Sitar, Perlmutter, Druian, Colalillo – but Infusino’s deep belief that Wakefern’s model was best suited toward independent retailing and his altruistic spirit made him an ideal candidate to become actively involved in the wholesaler’s growth.
By 1965, Infusino joined Wakefern’s board and six years later he was elected president. That position was later expanded to encompass chairman and CEO. When he retired in 2005, Wakefern’s wholesale revenue had grown from $747 million to more than $8 billion annually.
To some, Infusino was the ultimate tough guy. And I can attest that he had very little tolerance for the media. But I know this wasn’t personal; Wakefern was a privately-hold organization and Infusino felt that that he was its guardian. Why reveal anything that could provide fodder for the competition?
I always thought of Tom Infusino as the Vince Lombardi of the grocery business. He was a combination of intelligence, toughness and passion with a work ethic that was off the charts. And as tough a boss as he could be (ask a few suppliers about it) there was a heart of gold attached to his entrepreneurial style. Charitable efforts, philanthropic projects, community needs and the importance of giving back and saying “thanks” were always very important to Infusino as witnessed by his speech on Ellis Island at Wakefern’s 50th anniversary in 1996.
“We could never have been successful without the help of many people and companies, first among these our families. Many of our operators today grew up going to the store with their fathers – not only to learn about the business or earn extra money, but also spend time together. And the wives and mothers often had two or three jobs – raising the children, making a home, and managing the company’s finances. Over the years, our families had to make a lot of sacrifices in order for us to grow.”
‘Round The Trade
There was a Craig Herkert sighting at the recent National Grocers Association (NGA) show in Las Vegas. According to several retailers and Supervalu executives who attended the retailer/wholesaler’s cocktail party held at the Mirage Hotel, Herkert briefly addressed the independent retailers and mingled for awhile. Sources described his speech as “upbeat.” The next day, Herkert met with the Rite Aid board to discuss the joint Save-A-Lot/Rite Aid effort the two struggling firms are testing in 10 stores in South Carolina. A few weeks earlier, I listened to Herkert’s meeting and video webcast to Supervalu’s associates. The “spinmeister” was joined on stage by Pete Van Helden, executive VP-retail operations. If I didn’t know better, I might have thought that “Uncle” Craig and “Cousin” Pete were asking the troops to gather ‘round the campfire’ while weaving their tale of optimism. Sure, things are tough, but they are improving. And if you eliminated the write-downs, the numbers were really not that bad, according to “Uncle” Craig. And “Cousin” Pete added that SVU is now profiting from recycling its trash, turning a former burdensome expense into a productive and efficient program. “Sister” Sue Klug, who serves as president of SVU’s (Albertsons) Southern California division (and a long-time Van Helden acolyte), was piped in from a remote location to add how productive her “center store out of stock” project was progressing. “Kumbaya, my lord, kumbaya.” The hour-long performance seemed so contrived and staged, it was insulting to the associates who were in the audience or listened in.
More Supervalu news: the company will close corporate office facilities in Chanhassen, MN and one of its three offices in Eden Prairie, MN, the town in which the struggling merchant is based. As Target continues to move toward more self-distribution (and away from SVU), Supervalu is offering buyout opportunities to 57 associates at its Champaign, IL and Urbana, IL (produce) depots. On the personnel side, Leon Bergman has joined SVU as group VP-independent sales, marketing and merchandising, a role formerly held by SVU veteran Brian Audette. Bergmann joins Supervalu from C&S. He reports to Mark Anderson, president of Supervalu’s independent business platform. And Duncan Mac Naughton, who left Supervalu to head Wal-Mart’s merchandising effort in Canada, has been promoted to chief merchandising officer (CMO) for the Behemoth’s 3,700 U.S. stores, reporting to Bill Simon, Wal-Mart’s CEO for the U.S. Duncan is certainly a smart guy who knows the grocery biz, but let’s not forget that he was chief engineer of SVU’s SuperFusion effort, arguably the worst centralized merchandising plan ever conceived and executed by any grocery company. I also found it interesting that while Wal-Mart is legally contesting former North region president Hank Mullany’s departure to CVS, the world’s largest retailer sought considerably less when Craig Herkert left the Behemoth to join Supervalu. Think the boys from Bentonville know something? And now it seems CVS may have moved on in its search to find a new president for its pharmacy division. Mike Bloom, CVS’ executive VP-merchandising and supply chain, and Scott Baker, executive VP-international operations and real estate, are jointly managing the retail business for CVS’ 7,100 stores while the company looks for someone permanent. The Woonsocket, RI drug chain said last month that it had resumed its search for a permanent president of the unit, a job Mullany accepted before being blocked by Wal-Mart, which challenged his ability to move to a competitor. The two feuding parties have a March 15 date in Delaware Chancery Court. Mullany’s former Wal-Mart role has been assumed by Rosalind Brewer, who has been president of region South. Her region has now been expanded to also include the Northeast and parts of the Midwest. Mike Moore, who was named as Mullany’s successor in November, will head up Wal-Mart’s Midwest region. Our buddy (and former Wal-Mart executive) Jim Donald is stepping down as president and CEO of Haggen, the 30 store regional chain based in Bellingham, WA. Donald, who will remain an adviser to the retailer, joined the 78 year old chain as chief executive in 2009, after serving as a consultant to brothers Don and Rick Haggen. What precipitated the change was private equity firm Comvest Group’s majority purchase of the retailer. The Haggen family will retain a “significant” minority stake in the company…Wal-Mart showed significant improvement in its fourth quarter earnings and sales. For the period ended January 16, the Bentonville, AR mega-merchant posted an 8.2 percent earnings increase, a 5.3 percent overall sales gain and a jump of 2.1 percent in ID sales. The world’s largest retailer a whopping grossed $506 million in world-wide sales.
Trade Buzz
Teamsters Local 863, based in Mountainside, NJ, has been leafleting a number of A&P, Super Fresh and Pathmark stores in New Jersey, Pennsylvania, Delaware and Maryland. The union is protesting the closure of the six New Jersey warehouses by A&P’s primary supplier, C&S, on February 6, which resulted in the termination of 1,300 workers. In a letter of response to its customers from A&P CEO Sam Martin, the retailer said the leafleting “does not have anything to do with A&P or Pathmark employees.” The Teamsters are linking A&P into this matter by claiming the Tea Company “didn’t support a 90-day moratorium to give workers, businesses and elected officials a chance to save these jobs.” One more thought related to A&P: the man Sam Martin replaced last July – Ron Marshall – is this year’s winner of the “get out of Dodge before the crap hits the fan” award. After the former Dart Group Corp. executive left A&P, the company went Chapter 11. Last week, another retailer that Marshall formerly led, Borders, filed for bankruptcy. And when Marshall left Nash Finch in 2006, it wasn’t exactly a ceremonious exit …Ahold USA posted solid sales numbers in its recently completed fourth quarter and year end. For the 12 week period ended January 2, 2011, net sales increased 6 percent, partly due to the Ukrop’s acquisition, and ID sales rose 0.9 percent (excluding gas). For the 52nd year, the Amsterdam based retailer’s U.S. net sales grew 5.1 percent (also aided by the Ukrop’s purchase) and ID revenue increased 0.4 percent (ex-gas). On the local scene, I’m told that the search for a new president of Giant/Landover is progressing smoothly and we very well could learn who will be piloting that $5 million unit by the end of the month. Former Giant/Landover president Robin Michel has joined Sears Holdings as senior VP and president of food and consumables and health and wellness, where she’ll oversee those areas for Sears and Kmart, both in the stores and online (that post was formerly held by Tom O’Boyle, now executive VP-merchandising, marketing, supply and logistics). If you work for Sears or Kmart, expect a new boss who’s high energy, with a tireless work ethic and an “in your face” style of management. Additionally, on January 28, Carl Schlicker officially took over as the chain’s top U.S. officer, replacing the retiring Larry Benjamin. Mr. Schlicker immediately made a very shrewd move in naming former EVP-human resources John Bussenger to serve as executive VP and assistant to himself. They don’t come much brighter or carry more integrity than Johnny B., who has worked closely with Carl for many years. Coming on board to oversee all human resources at AUSA (Bussenger’s former post) is an old friend – Bhavdeep Singh, a veteran of A&P, who for a short time supervised the Tea Company’s Super Fresh operation based in Baltimore. Bhavdeep knows the business and is extremely intelligent to boot. And now a few words about the aforementioned Mr. Benjamin. In my 37 years of writing about the grocery business, there are very few men I’ve met of Larry’s caliber or fabric. Super bright with superior people skills and a calm (but tenacious) approach to the job, Larry Benjamin truly epitomizes how businesses today should measure their CEOs. Whatever Larry’s next venture is, it’s sure to be successful and we wish him all the best in his future endeavors¼vendors are still barking about the lack of cohesion concerning Ahold USA’s new centralized merchandising shift to Carlisle (the retailer claims that things will improve when its IT platform becomes integrated over the next several weeks). Ahold’s struggles to get its merchandising platform in synch, may be the primary reason why Delhaize America (whose reorganization plan resembles Ahold’s to a large degree) has opted to keep both Salisbury, NC (Food Lion, Bottom Dollar, Bloom, etc.) and Scarborough, ME (Hannaford) operational as supply chain and merchandising support centers. Salisbury will serve as headquarters for produce, meat and seafood and Scarborough will be the merchandising center for deli and bakery. Center store will be managed from both locations (we’re told that there will be no duplication of categories, which will be consolidated into one location with that CM based in either Salisbury or Scarborough)…BJ’s Wholesale Club seems much closer to be being sold than ever before. The East Coast-centric club store operator, which has been rumored to being taken private (in a move that could be led by Leonard Green & Partners, which owns 9.5 percent of the company), has hired Morgan Stanley & Co. to “explore its options. “ That language usually translates to finding a new buyer, which still very well could be Leonard Green. No timetable on the exploration was announced… after attending both the FMI Midwinter Conference in Phoenix and the aforementioned NGA show in Vegas, the mood of the retailers remained cautious. Many operators told me that they are slightly more optimistic that sales are improving and the economy, while still not as stable as they hoped, has bottomed out. However, there are new concerns about spiraling commodity price increases and as usual, operating in many markets that are significantly overstored both in numbers of outlets and diversity of styles. One piece of good news from the FMI confab: Fred Morganthall, president of Harris Teeter, was elected chairman of FMI and will begin his two-year term in May. You won’t find a more dedicated and ethical executive in the business than Fred. He’s just the right person that the industry’s largest trade association needs as it tries to reshape its image…one retailer who is not experiencing much pain from the recession or competition is Whole Foods. The Austin, TX natural and organics retailer posted a 26 percent earnings increase for its first quarter ended January 16. Overall sales jumped 14 percent and ID revenue rose a very impressive 9.1 percent. Additionally, for the first three weeks of its second quarter (January 17-February 7) ID sales increased 8.6 percent. Six new leases were signed during the 16 week first quarter, including a new site in Marlboro, NJ…Safeway (Genuardi’s) has introduced new in-store shelf system designed to make it easier for shoppers to locate better nutrition choices for foods and beverages. Safeway’s version of what is becoming a fast-growing industry trend is called “SimpleNutrition.” The Pleasanton, CA chain also recently unveiled its “Open Nature” private label line of 100 percent natural foods. With more than 100 SKUs rolled out late last month, “Open Nature” joins “O” and “Eating Right” as own-store health and wellness brands. Also, it appears that Safeway will be consolidating all of its ethnic and specialty business to one distributor and we hear that UNFI will be named to service more than 1,700 stores.
Local Notes
Acme’s latest attempt to buy out many of its senior clerks at stores supervised by UFCW Local 1776, has met with rejection again. The Malvern, PA unit of Supervalu had first attempted to eliminate about 300 store level positions last summer. This time, Local 1776 said such a buyout would jeopardize the Local’s pension and health and welfare funds. Because the lump sum offer would affect mainly the most senior (and highest earning) members, Local 1776 was concerned that such a move would accelerate the number of early pension withdrawals and health benefit outlays for retirees. Local 1776 believes that Acme should help shoulder the burden by investing some of the projected savings into the pension and health & welfare funds, which the retailer has refused to do. “Some of the savings should be used to cushion the early buyout,” Wendell Young, president of Local 1776 is quoted as saying. “It’s going to cost them more money not doing it our way. Late last year, approximately 100 members of South Jersey’s UFCW Local 1360 accepted a similar buyout offer…the Tastykake situation doesn’t seem any more promising than it did last month, when the Philadelphia snackpacker was given a reprieve until June 30 to either sell the company or repay its mounting debt. Since that time, share of Tasty Baking have hit a 20 year low (at presstime shares were trading at $2.39). The question most asked is will potential buyers wait until after June 30 when the company may have to declare bankruptcy or make a pre-emptive low-ball offer to secure a business that has more than $170 million in debt and other accrued liabilities? My bet is that Flowers Foods takes a run at the 97-year old company…Weis announced that its fourth quarter sales for the period ended December 25, declined 1.3 percent and its earnings dropped 9.3 percent. However, for the 52 week fiscal year the numbers were much brighter. The tightly controlled regional chain posted an 8.7 percent profit gain to $68.3 million and overall sales rose 4.1 percent to $2.6 billion Comp store revenue increased 1 percent. “We’ve achieved our 2010 goals and have generated strong earnings increases for two consecutive years while maintaining our store base and increasing our cap-ex investments in markets impacted by cautious spending and lower consumer confidence,” said vice chairman Jonathan Weis. “Our results are due to increased productivity and cost controls at store level, supply chain improvements, efficient procurement and a discipline go-to-market strategy.”¼Utz Quality Foods, the family-owned firm based in Hanover, PA, has signed a letter of intent to join forces with Gramercy, LA based Zapp’s Potato Chips, which has plants in Louisiana, California and Pennsylvania and produces chips under the Zapp’s, Dirty and California Chips labels¼obituaries this month include the passing of Gene Merkert, former CEO of Merkert Enterprises, which from the 1970s through the 1990s was probably the largest food broker in the country. I got to know Gene very well from my early days at The Griffin Report in Boston and a savvier, more intuitive salesman didn’t exist. Gene was polished when he needed to be and street tough when that was called for. He was 92 and living in Loxahatchee, FL when he passed. Also entering the pearly gates earlier this month was Kenneth Mars, 75, character actor, who was a staple in two of Mel Brooks’ funniest films, The Producers (1968) and Young Frankenstein (1974). In the former flick, Mars played Franz Liebkind, who penned the awful play, “Springtime for Hitler,” in which conniving producers Zero Mostel and Gene Wilder bilked little old ladies into investing (the sequence in which the title song is performed might be the funniest five minute scene in movie history). Mars also played one-armed Inspector Kemp in search of mad scientist Gene Wilder’s monster. In both movies, Mars managed to steal almost every scene he was in. I’m also sorry to report the death of Len Lesser, 88, veteran character actor who appeared in more than 160 films and TV shows dating back to the late 1940s. Lesser is probably best known for playing Jerry Seinfeld crotchety “Uncle Leo” in 15 episodes. If you had to memorialize Lesser with only one Seinfeld show, you’ve got to see “The Watch (1992),” to capture the essence of how funny “Uncle Leo” really was. And finally, we say goodbye to the 98 pound weakling who became an icon of American fitness, Jack LaLanne, the man who swam from Alcatraz Island to Fisherman’s Wharf in San Francisco at age 60 while handcuffed, shackled and towing a boat. Ten years later, he performed a similar feat in Long Beach, CA. When I heard of LaLanne’s death, my first thought was that we lost a great American. My second thought was that his Power Juicer remains one of the finer products sitting in my kitchen cabinet ¼and finally, for all the attention that social networking is receiving these days comes this piece of reality (yes, I see the relevance of Facebook, My Space, Twitter, etc., but I think the hype is way overblown). Apparently, many posts and status updates at these sites extol the virtues of upcoming vacations, revealing dates and destination plans complete with photos. That’s where pleaserobme.com comes in. After the organizers of this site locate addresses of the vacationing users, a number of social networkers have returned from a wonderful holiday only to find their homes ransacked and burglarized. In a sick way, this is entrepreneurial ingenuity at its finest. I’m actually thinking of starting a new website to be called bediscreet.com, where the subject matter definitively won’t be the color of my latest tattoo, the irritation of my new hangnail, my latest stint rehab or how many times I’ve dated Lindsay Lohan (the last two items may be related).