Over the past 12 years, Tops Friendly Markets, a strong presence in the Western New York market since its founding in 1962, has experienced some challenging times. The regional chain was acquired by Morgan Stanley Private Equity in 2007, then sold back to a management group led by CEO Frank Curci in 2013. Curci has served as the company’s CEO since 2007. Needing to reduce debt and restructure other aspects of its organization, Tops filed for Chapter 11 protection in February 2018; nine months later it emerged from bankruptcy as a company better equipped to compete in its current market landscape which includes 163 stores in New York, Pennsylvania and Vermont and. We recently visited Curci to discuss how Tops is faring post-bankruptcy.

Food Trade News: Since coming out of bankruptcy, in addition to during the bankruptcy period, what changes have you and your team made, important changes, to better ensure Tops’ long-term stability and success? 

 Frank Curci: Let me approach it this way. When we entered the bankruptcy process we knew that the positive thing we had going for us was that we have a strong underlying business. Our network of stores is good, we were happy with our management team and our dedicated and passionate associates. We thought that our go-to-market strategy was a definite differentiator and one that resonated with the upstate New York customer base. What we did not have was a balance sheet that could take us in to the future. When I talked with our people about the filing, I talked about the fact that we had a good business, but a bad balance sheet.  Entering the Chapter 11 reorganization process was not an easy decision for us, but we did it voluntarily. We knew we were getting pushed in that direction and the level of debt that we accumulated under past ownership was no longer sustainable in today’s competitive environment. We were at the point where we could not do the things that we needed to do to sustain and grow our business. We had to address our balance sheet and that is what we were able to accomplish during the bankruptcy. The biggest thing was that we reduced our debt level from $700 million down to under $400 million, with a reduction in interest cost of approximately $40 million. That was the most important component of our ability to move forward. 


 Food Trade NewsWhat have you been able to do with that flexibility, with that freedom? You had the plan, you couldn’t really accelerate it to overdrive, because you were financially handicapped. So, what are some of the things that you are able to do now that you have regained that flexibility? 

 Frank Curci: Now that we have the financial flexibility to move forward, we have also reduced our cost of doing business in several other areas. Now we can go about rebuilding our business in the way we know we need to in response to the changing consumer. For instance, we weren’t able to put money into our stores like we wanted to do. Historically, our stores are pretty well invested in, but the last couple of years we really didn’t have the financial flexibility to continue that investment. And, you know, I have been in this business a long time, and the changes that we have seen in our customer preferences over the past couple of years is the greatest that I have seen in a long time. We know that our stores have to reflect those preferences. The changes I’m talking about really revolve around perishable offerings, more meal solutions, grab and go. We needed to have customers be able to come into our stores and fulfill their needs for that night’s meal and that meant expanding the perishable side of our stores. So, our delis, bakeries and meat departments had to be able to meet the challenge of providing meal solutions for people. When we go into our stores now, we really need to spend a little bit more money to expand the fresh side of the business, really at the expense of center store. What you will see in our new stores, and we have eight to ten stores that will be remodeled this year – we are right in the process of starting those now – is that we will take several aisles out of the center of the store and really put that space into the fresh side of the business, so that customers can have the things that they want. 

 Food Trade NewsAt what level or hard number have you been able to increase your cap-ex? 


 Frank Curci: That is a little bit hard to answer because last year during the reorganization process, we had almost no cap-ex program. We have a cap-ex program now that will be right up there with the industry standards. We’ll be able to spend $40-$50 million, in the past we were spending maybe one half of that. And of course, during the last year and a half we were spending almost nothing. We will be able to do 10 to 15 major remodels a year. One thing about upstate New York is that it is a low growth market, quite frankly. When we compare our cap-ex programs to others in the industry, there is almost no new square footage growth in our market. So, you are not going to see a lot of ground-up new stores for us and those are the most expensive things to do. When we look at our capital program, we really think that this is a good level of spending, it is one that we can handle as an organization. We have this fresh format that we built a couple of years ago, Orchard Fresh, that is a totally different customer base for us. We learned a lot about prepared foods and what the modern customer wants with this format. We opened the Orchard Fresh store less than two miles from an existing really good traditional Tops store, and we found that almost all of the store’s customers did not come from our store, they came from the rest of the market. They came from competition and they came to us because we are fulfilling a need for them for healthy, natural, prepared foods. Items that they quite frankly couldn’t get in a more traditional supermarket setting.  

 Food Trade News: And now that the company’s foundation has been restored is there any possibility that you will open more of those or other related type formats, offset formats? 

 Frank Curci: That’s an interesting question. The short answer is yes. What we see as a real opportunity for us is to take what we have learned in that format and incorporate it into a more traditional supermarket company so that you have a combination of the groceries that people want and the fresh side of the business that may have been a little bit behind the times and a little bit lacking in terms of what the modern millennial customer wants. So, you could see more of a combination there in terms of going forward.  

 Food Trade NewsWhat remain Tops’ biggest challenges? Its biggest opportunities? 

 Frank Curci: I think our biggest challenge is, and this is probably pretty obvious, that we are a medium sized company. I like our size, I like that we are small enough that we can understand our stores but still big enough to have some scale. But we compete in upstate New York with some of the best and biggest in the business. When you look at our competition, it is Walmart, Wegmans and Aldi. Those are the big three that we compete with. The way we compete with them is by being different. We are a promotional retailer. None of those three are really promotional retailers, they are more everyday low price. But they are much bigger companies with much greater resources in an area that doesn’t have a lot of growth, so margins are always tight in our business and top line growth is always difficult in this type of environment. We have had investment by Aldi in terms of their remodel program and Walmart and Wegmans, while they may not be opening up a lot of new stores, are still formidable competitors, and competing with them is always a challenge. They have more resources and we know that in order to compete with them we have to be different, we have to be nimble, we have to make quick decisions, we have to keep our stores fresh and up-to-date, we have to do things that they are not willing to do and it is not easy in the long run.  

 Food Trade News: So, I think that you have answered the back end of the question – those are your biggest opportunities. The challenges lie in front of you, you see them, facing powerful regional or national chains, different formats. You have to clearly delineate what that separation is and at the same time be very good at it.  

 Frank Curci: That is absolutely true. I’d say that the biggest change in our marketplace over these past couple of years that has been an extremely big challenge for us is the proliferation of formats like Aldi and Walmart, which have extremely low prices, a lot of emphasis on own brands and are a very easy shop for people who are just looking for low prices. We do have a strong own brand offering, we do have a promotional format, but trying to match Walmart on price is very difficult for a company like us. In fact, it is impossible. So, we have to do other things to attract people and those other things have to be around experience and solutions.  

 Food Trade News: Now that the company has been stabilized, you know what the priorities are, you have a vision of what you need to do, can you describe to our readers and your customers, although they won’t be reading this, what they might see that is different from say, a year ago? 

 Frank CurciThere are a couple of differences that we are really going to concentrate on in the coming year. We know that we have to be an easy place for people to shop, and our promotional plan in the past tended to get a little bit too complicated and it was complex enough that people started to be a bit confused. So we are going to be more straight-forward in our pricing. Customers will see everyday prices come down, our ads will be cleaner, there will be fewer hoops for the customer to jump through, more about specific price points on known value items that they will be able to come in and get every day. We are trying to make ourselves a little bit more efficient in how we deliver value to our customers. That will have the benefit of making us a little bit more efficient here in the office. It will make our store teams be a little bit more efficient in how they display products and programs and make it easier for our customers to understand. We are revamping the way we bring our promotions to the market.  

 Food Trade News: Are you also implying that the actual associates, the labor in the stores, might be deployed differently, a little bit more embracing directly with that customer?  

 Frank Curci: Absolutely. Right now, too much of our store teams time is spent on changing prices, building weekly displays, doing things that really don’t deliver value to the customer. If we simplify our promotional program and cut out 20 to 30 percent of the types of promotions that we have every week, our store teams are going to have more time to prepare the store for the customer, give service to the customer, answer questions, be able to guide them through our store. It is a change that we are pretty excited about. As we were going through this reorganization it became clear to us that we were becoming harder to deal with in terms of people understanding what we were doing, but it wasn’t just the customers, it was our vendor community and it was our own staff here in the office who were producing plans. We are trying to get through that process to make everything easier. 

 Food Trade News: You mentioned that you are going to simplify some merchandising, inferring looking at items, what fits better, what may have a better turn result because of simplicity, efficiency. So, since basically half of our readership consists of the supplier community, what will vendors see that is different?  

 Frank Curci: The challenge is how do we revamp our whole program so that it is not only better for customers, but better for vendors. We are going to deal with vendors on a more strategic basis. Instead of our category teams fighting to try to get items to put in the ad and support those items every week, now we are going to build programs for the long run that could be relevant to customers. We are going to try and build promotions and displays that help customers have a solution, a meal solution, instead of just items that people want us to push. It is going to be more of a thoughtful program, it is going to be a program that we can build loyalty over a longer period of time. There will be more longerterm TPRs, lower shelf prices, those kinds of things where everybody can depend on a little bit more normal volume than just promoted volume. 

 Food Trade News: If I were a typical vendor, give me a take away that would encourage me beyond the fact that you are going to be deploying cap-ex, you are putting more into the finished product, theoretically growing sales. What is going to make me feel good about my take away experience with the new Tops? 

 Frank Curci: The vendors should know that we are now going to be looking at programs for the long run, to drive their business in the long run. We are not going to be looking to nickel and dime on every little individual thing that we do. We want to build advertising programs, we want to build pricing programs that are going to build volume for both of us over the long run. We are still a promotional retailer, we will still have promotions, but they will be more thought out. They will be built more with the longer term in mind instead of just short term – what am I going to have in the ad this week, what can I get from you that will allow me to put something in the ad? It is how do we want to build this business? What do we want to stand for in the customer’s mind? What are those known value items that people buy every week that we can help them build meals around? Those are the types of things. It is more a strategic look and a promotional plan and the way we are going to build and market our stores going forward.  

 Food Trade News: One of the things our readers find interesting is this constant buyer vs. seller grind. It’s like “we want to work with you, we want to call you partner,” but too many retailers have programs that vendors perceive as money grabs. From your perspective, you are in the hot seat, you are the customer. In the vendor’s view, if you had a wish list for the people who call on the company, how would you look to improve the overall relationship and, most importantly, their effectiveness with Tops? What items might be on that wish list? 

 Frank Curci: There are two big ones. One is having transparency in how they could fund their products coming through our stores. There is a constant tug of war of us asking for money for various things and them wanting to just do an overall price program. I understand both sides of that. The problem for us is that we don’t want to be at a disadvantage against other retailers by not asking for the right things. What we would like to do is develop a program with them where they are transparent with us about what the funding levels are because we want our fair share of funding. We are willing to not ask for every individual item as long as we have the understanding that we are going to be treated fairly with vendors against our competition. We just want our fair share. We are willing to take it in a nice steady way and we will deploy it the way we think it should be deployed. Too often we are in a position where we have to go for extras if we feel like we are not getting a fair shake from them. That is always a big tug of war that I think could be amplified on. That is one big one. The second one that I would ask of vendors to keep in mind is that traditional supermarket retailers are the only ones out there selling their whole program. However, today everyone wants to sell food. Every dollar store, every gas station, every Home Depot, every Lowes, they want to sell the top 50 items, the top 100 items. The problem for us is that we are the only outlet that stocks all of the vendor’s products. There is a cost behind us carrying the inventory and being the place where people could be traded up, where people could be introduced to new products. By everybody selling the top items, that takes thin margins down to almost no margin. There is no way for us to survive in the long run with just the tertiary items. That is how vendors survive – by line extensions and all of those other things. It puts us at a severe disadvantage when we are the ones out there selling the whole program and everybody else gets to sell 100 ounce Tide or whatever the main product is.  

 Food Trade News: So, how should vendors perceive that – as you need to review your go-to-market approach knowing that we are taking your full basket, we are giving you those ancillary opportunities? 

 Frank Curci: There is a cost for us to do that and they need to help us with that cost if we are both going to survive in the long run. Neither of us is going to survive if we just sell the top 50 items. There is a definite cost to the fact that we are going to carry the full line of a manufacturer. It doesn’t help us when the top five items in every category can be bought anyplace, can be bought by subscription, can be bought online, can be bought in a gas station. It really hurts us. We have to find a solution to that.  

 Food Trade News: Your role as a businessman in Buffalo – you have been here a long time. It is a very tight, familial type market. You are not only CEO of the largest supermarket chain in the area, you are also the board chair of Kaleida, which is the region’s largest healthcare organization. You have a pretty broad view of the whole marketplace, not just your perch here. How do you look at the economy here in a market like this, where there is no growth, somewhat negative growth, depending on where you are situated in the market? And related to that the legislative piece, which could apply nationally or locally, but always a key component when we are talking about economic health. 

 Frank Curci: I have been in Buffalo for almost 20 years now. It is hard to believe. I have seen a lot over those 20 years. I am the board chair of Kaleida Health, which is the largest hospital system here. It is the largest hospital system in western New York. The funny thing is, although it is a totally different business, it is similar in a lot of ways because they need scale, they need to continue to grow, they have almost as many employees as we have. We have 14,000 employees. They have 11,000. There are a lot of the same issues. So, you are right, I do get to see a lot of different aspects of the economy here. I will tell you this, the economy is as good as it has ever been here in upstate New York. I think from the governor to everybody in Albany, they have paid more attention to upstate New York then they have in a long time and that has been good for us. There is actually some growth here. The growth means that the negative has fallen to almost zero. There is slight growth now. There are a couple of aspects that I have always tried to explain to people. I love doing business in upstate New York because people are genuine. They are loyal. And they will listen to what you have to say. Here, the fact that it has been a no-growth market for such a long time keeps some people out of this marketplace, quite frankly. In my past, I spent some time down in South Carolina with Bi-Lo. In the Carolinas everybody in the world wants to be there. Here you can build a business and sustain it for the long run. Tops has been a part of the community since 1962. We have a long proud history. It is a great legacy and people appreciate that. You said earlier that the family aspect of the business as it grew up was important to customers. We are the hometown grocer here. We want to continue to grow in the marketplace. Our store network here is better than anybody’s. I think people really do enjoy shopping with us and recognize our commitment to the community. The fact is that we are locally owned and operated. Our management team lives and works here. I do think that is an advantage. We are starting to see some growth, but we are not going to get growth from organic sales. If you look at the history of our ID sales, they have been flat. The reason behind that, to a large extent, is the fact that we have such a strong presence that when other companies like Aldi and Walmart built stores and their presence over the last decade, the pie didn’t get any bigger. They do business, which makes it is hard to get organic growth. What we have done here at Tops, and what we are going to have to continue to do, is to grow our scale. When we took the business over from Ahold in 2007, we had 71 stores. Today we have 159.  That is really an important part of our story because we are not going to get the scale and growth from internal sales, from ID sales. We are going to need to manufacture that growth.  

 Food Trade News: You have also expanded geographically. 

 Frank Curci: We have. When we took over from Ahold, we were largely in the Buffalo and Rochester markets. The Penn Traffic acquisition got us into Syracuse. The Ahold-Delhaize merger allowed us to pick up stores in the Hudson Valley. We bought the old Grand Union stores from C&S up in the Adirondacks. That has expanded us across upstate New York. We have 17 stores in Pennsylvania. We have three in Vermont. We are excited about our ability to take our program to other markets. We have done really well in the Hudson Valley. We have done well in the Adirondacks. We have done well in Syracuse. We have done well in the markets that we have gone into. That is how we see us continuing to grow our business. Because the economy here is never going to be booming.  

 Food Trade News: It is not just the pure scale of saying that we doubled our store count, it is also the success you have had in these new markets, that have not only created scale but have created sales momentum. 

 Frank Curci: Correct. Here in Erie County, in Buffalo, we are not going to be able to grow much. We have stores on every corner. We have a great store network. It is just not going to offer growth to us in the future. In Rochester we have the opposite – with that being Wegmans’ hometown – we have a presence there. It is a profitable presence, we are proud of our stores but with those two markets we are in a détente now. Everybody is kind of steady. It is the new markets that give us the growth that we are going to need in the future.  

 Food Trade News: Are there plans to touch down in other markets adjacent to where you have expanded or expand the base in Syracuse, eastern Pennsylvania, Hudson Valley? 

 Frank Curci: I think our greatest opportunity is to continue to fill in our current footprint. When you go east of Syracuse, north of Syracuse, those areas where we are not well populated now. What we found in the past is that by going after independents that are looking to get out of the business or can’t compete, those are good opportunities for us to come in and take over a store for what is a very attractive multiple for us once we put our cost structure and our program in placeWe have been pretty successful at growing that base. We think there are opportunities for 20 or 30 more in those types of situations when we get further out east. We will look at individual niches and opportunities within that footprint. I think that will keep us pretty busy for now. 

 Food Trade News: I don’t know if you realize it, but Tops was one of the first retailers to utilize an infill strategy. You bought Penn Traffic. You were one of the first to adopt something that now we are seeing Ahold use, Weis use. I’ll take the twos and threes. I want to be here. As you know, that used to be frowned upon – there wasn’t enough scale, we are a new market, it is going to be difficult to ingratiate ourselves. Now that philosophy seems to have changed. You were one of the pioneers in that mindset. 

 Frank Curci: I think that we were early on in that. It has been really successful for us. We have acquired independents from one store to four and five stores and they have been very successful. They tend to be in some of the out markets that are more defendable. You are not going to get a Wegmans or Walmart to build a new store there. They are profitable ventures and there are not a lot of downside risks to those things.  

 Food Trade News: We are seeing much more of that. Whether its inner city opportunities or let’s move the goal posts a little further for the primary purpose of we can’t exist with 18 other chains around us. That has proven to be a pretty sagacious mindset in terms of what the industry is now doing. Regarding legislation, which specific legislative items might impact Tops and the entire Western New York market? 

 Frank Curci: It is hard doing business in New York, especially upstate New York, since most of the legislature is very focused on the big cities. Upstate New York is very different from the city. In a no growth, low margin business, it just makes it very difficult to do business, especially with all the legislation around minimum wage and benefits, etc.  We have stores in Olean and in Frewsburg and Watertown, NY and all of those places where we offer very good jobs to people. All of the legislation around wages and benefits could push us to the limit where we are not going to be able to operate in those types of situations anymore. The volumes just aren’t high enough. It is very difficult for us to do it.  

 Food Trade News: Specifically, you are talking about minimum wage programs? 

 Frank Curci: Minimum wage, worker’s compensation, family leave benefits, scheduling. In supermarkets all of those things add up to an environment where it is difficult to be profitable. They are going to push us out of more marginal areas and it is not going to be good for the local communities. I understand why you need a $15 wage in New York City, but in Jamestown, NY, where most of the population is at a much lower income level, you are just not going to be able to operate anymore.  

 Food Trade News: Digital and e-commerce: what is Tops doing that will make it more visible, more proactive and more engaging in that space? 

 Frank Curci: The fastest growing part of our business right now is the digital side. We partnered with Instacart about a year ago. Today, almost 90 percent of our customer base can shop online with us and have orders delivered directly to their homes. We chose to go with Instacart because they had the best program. It is almost impossible for a company of our size to develop our own network of delivery and online ordering and all of that. We thought it was the best and quickest way for us to go. We have delivery, our prices online are the same as if you shopped in the stores. We also just started to roll out “Click and Collect.” Right now, it is up and running in three stores. We have 10 more stores coming within the next month. Most of our customers will have the availability of ordering online and getting it delivered or ordering online and going by and picking it up. However, it is still a very small part of our business. Upstate New York, again, is different than New York City. People here have cars. They drive around. They can get in their cars at any time and in five minutes be in a store. It is not a big deal. They have a suburban house, they don’t have to climb up eight flights of stairs. But we need to be in the space, so we have gone allin with Instacart. While it is still a very small percentage of our business – less than one percent –it is growing fairly quickly. We have a very active website. We have lots of email addresses. We have digital coupons. People can shop our ad online. We have an app. We are doing all of the things that a modern retailer needs to do, because we need to be relevant. We are also working on a program where people can shop in our stores and use their phones to buy stuff: by scanning it and paying at the front end. We are doing all of the things that we think we need to do to attract that millennial shopper. 

 Food Trade News: Would it be fair to say, based on the reality of this market or the differences of this market, that you are now poised to be able to adapt to some of these changing needs and tweak them to the point that, if something needs to be accelerated, you now have the capability internally and financially to do that? 

 Frank Curci: I think that absolutely the answer to that is yes. We are poised to fill the needs of the modern shopper. As I said, you can go online. If you look at our Instacart site, there is a lot of bundling and meal solution opportunities for people. You can shop our whole store online. I have use it myself, and while I like to be in the store, it is a pretty seamless operation. We think it is what some customers want. Will it ever be a major part of the business? I think in our area it is not ever going to be more than five, six, seven percent of the business, but we want to be relevant to that customer. 

 Food Trade News: Well said. Anything to add? 

 Frank Curci: I think we are poised for some good things ahead for us. This past year – while it was painful in a lot of ways, I would say that it  gave us the chance to really reflect on our business and understand what is important going forward and we now have the wherewithal to fulfill some of those goals. We are excited about the years ahead for our business. 

 Food Trade News: As you look at your career, which has been very successful, is there an end zone close by? Do you think that way? You are obviously in good health, but mindset-wise, where is the end zone if you know at all? 

 Frank Curci: I try not to look at it that way. The way I look at is, am I adding value? As long as I have input that is interesting and challenging to me personally, I feel like I will continue. In a lot of ways when you reach a certain age, you want to know that what you are doing is meaningful. Right now, getting through this process was very meaningful. I think I added a lot of value during the whole process. I think there is a lot of work to do to get us ready for the future and I would like to continue to do that as long as I know that I am adding value and I am excited about it, interested in it and it is fun to me.  

 Food Trade News: Thank you. 


Frank Curci Bio

Frank Curci has served as chief executive officer and director of Tops Markets, LLC since December 2007 and as chairman of the board since December 1, 2013.  

Curci has more than 40 years of experience in the supermarket industry. From April 2005 to September 2006, he served as chief operating officer for Alabama-based Southern Family Markets, a subsidiary of C&S, where he led the start-up of two chains emphasizing the neighborhood grocery store format. From June 2004 to March 2005, he served as senior vice president of operations at Farmer Jack, a supermarket chain based in Michigan.  While at Koninklijke Ahold N.V. from 1995 to 2003, Curci was chief executive officer of Tops Markets, LLC and held senior leadership positions at the Bi-Lo chain in South Carolina and Edwards Super Food stores on the East Coast.  

Curci also spent nine years from 1987 to 1995 at Mayfair Supermarkets, which operated as Foodtown in New Jersey.   

He is a certified public accountant and holds an M.B.A. and a B.A. from Rutgers University. 

In addition to his career, Mr. Curci serves on the boards of the Buffalo Niagara Partnership, The Food Industry Alliance of New York State, the Food Marketing Institute, and is Chairman of the Board of Directors of Kaleida Health.  He is also a member of the board of directors of Topco Holdings, Inc., a buying cooperative.    

Aside from business, his hobbies include running and golf.   

Curci resides in Clarence, NY with his wife, Robin.  They have three grown children and two grandchildren. 

Tops Markets LLC, is headquartered in Williamsville, NY and operates 163 full-service supermarkets – 158 company-owned and five franchise locations under the Tops banner.  With more than 14,000 associates, Tops is a leading full-service grocery retailer in upstate New York, northern Pennsylvania and western Vermont.