Nugget Markets

Nugget Markets, Inc.

Type	Private
Industry	Retail (Grocery)
Founded	1926
Headquarters	Woodland, California
Number of locations	9
Key people	Gene Stille, Chairman Eric Stille, CEO/President Chris Carpenter, COO/Vice-President
Products	Grocery
Revenue	221 million USD (2004)
Employees	1,300
Website	nuggetmarket.com

The popular Nugget Market on East Covell Blvd. in Davis, California

Nugget Markets is a family-owned upscale supermarket chain operating within the greater Sacramento metropolitan area. It is headquartered in Woodland, California. As of October 2009, the company operates 9 of its flagship Nugget-brand stores, as well as 3 Food 4 Less franchises.

History

Nugget Market was founded in 1926 by the father-and-son team of William and Mack Stille. Their store was located in the heart of downtown Woodland, California. Son Mack ran most of the day-to-day operations and helped pioneer many new concepts, such as incorporating meat departments into the grocery store, installing refrigerated produce cases (built by his father) and employing checkout stands equipped with take-away power belts. Customers and competitors alike noted their progressive, employee-friendly approach, providing associates (employees) with some of the top wage and benefit packages in the industry.

Expansion Outside Woodland

In the late 1970s, under the leadership of Mack's son, Gene, and grandson, Eric, the company began its expansion outside the local Woodland community by opening a Nugget store in neighboring Davis. In 1984, Nugget acquired a pair of Sacramento Alpha Beta Stores and converted them into Nuggets, one in the Greenhaven-Pocket neighborhood, the other in Foothill Farms. All Alpha Beta associates were invited to join the company, and many continue to work with Nugget today. In the early 90s, Nugget opened its first Food 4 Less franchise in Vallejo, California.

Fresh to Market

Beginning in the late 90s, Nugget developed their new Fresh to Market concept, pairing European-style open-air marketing with higher-end products and specialty departments, such as their Cheese Concierge, Pastry Chefs in a full-range Bakery, Full-Service Kitchen, Healthy Living Department, dedicated Seafood butcher and a Juice & Espresso Bar. The Stilles began an aggressive search for new locations with clientele that would appreciate their pleasant, motivated personnel. In 2001, the company built its first all-new Fresh to Market store in Vacaville's Browns Valley Marketplace and then at Oak Tree Plaza in East Davis.

Fresh to Market emphasizes a more artful approach to grocery marketing, with elaborately designed product displays, classical exterior architecture, a contemporary approach to interior design, and heavy use of natural sunlight. The "Nugget Tower" surrounded by statues of a robed woman with a basket of food above her head is a signature architectural feature at the entrance of its newest stores. The robed woman, casually dubbed the Market Mom, is now the corporate logo and mascot of the company. An artistic rendition of the statue with the tagline "Fresh to Market - Where Quality & Price Matter" has replaced the classic, double-G-downstroke-hoop Nugget logo in most corporate branding.

In 2008, Nugget sold its in-store pharmacies to Long's Drugs (which has in turn been bought by CVS Pharmacy).

Ever fine-tuning, the Stille family continues to experiment with niche foods from basic to boutique, working closely with hundreds of grocery vendors and several score local farms, ranches, vineyards, mills and manufacturers. Growing up around Nugget, many of Yolo County's highly motivated and educated organic farmers trained at the University of California, Davis, ag school and have eagerly embraced the latest science of food growing and responsible resource management. The Stille family was enthusiastic for organic long before it mainstreamed.

Points of Difference

Nugget continues to struggle against its image as an exclusive upscale grocer due to its specialty products and upscale store decor. Nugget identifies dominant local grocery chain Raley's & Bel-Air, as well as national chains Safeway and Whole Foods, as its primary competition.

To differentiate themselves from the local competition, they are the major regional distributor of several high quality specialty brands, such as Boars Head Deli Meats, Harris Ranch Beef, and Equator Coffees. Nugget supports local produce growers with its partnership with NorCal Produce of West Sacramento, California. Signs throughout their stores tout these partnerships and the quality of the products as key points of difference to shop at Nugget.

Nugget has also continued its stance on provided quality employee benefits, with wages and benefits meeting or exceeding those of its competition. Strong benefits coupled with a positive work environment and responsive leadership have allowed Nugget to remain a union-free workplace. Fortune has recognized Nugget Markets for the past three years as one of the 100 Best Companies to Work For. In 2008, the company placed 12th,^[1] in 2009, Nugget reached the No. 10 spot,^[2] and in 2010, they moved up to number 5, placing just behind Google.^[3]

Nugget continues its push to open new stores in the Sacramento and North Bay regions. Recently opened locations are in Elk Grove and El Dorado Hills. There are also tentative plans for Nugget to build a unique, significantly smaller size store under the K Street Mall revitalization proposal of Hank Fischer/Evergreen Developments. The K Street location would likely be half the size of a traditional Nugget store and, given the nature of the proposal, more focused on their Full Service Kitchen, Bakery, and Juice Bar.^[4]

"Price Challenge"

Because of the breadth and quality of merchandise they carry in their stores, there is the perception that Nugget is expensive and overpriced. The company has attempted to tackle this problem through their "Since 1926 Price Challenge". All guests (customers) are invited to pick up blank price-comparison survey forms at the stores, which let them survey prices on 25 items of their own choosing at Nugget and at one conventional competitor (such as Raley's, Bel Air or Safeway). Whether Nugget wins or loses, every properly completed survey is entered into a monthly drawing for a $1,000 Nugget Markets Gift Card. Nugget claims to win at least 80% of item-to-item price comparisons with other full-service markets.

Nugget also publicizes its own internal team of price checkers who weekly go to competitors to check their prices. All Nugget-brand stores have a "Price Challenge Scoreboard", designed to resemble a baseball scoreboard, with a tally of wins and losses against their competitors.

Vallejo store controversy

Given the company's success with the Food-4-Less store, in 2003 Nugget began plans to open a Nugget in Vallejo as well. The company sought assurances from the city that a supercenter store would not enter Vallejo, and these fears were seemingly assuaged when Wal-Mart built a supercenter several miles away in American Canyon. Development began on a Nugget and a property was selected.

In 2005, Wal-Mart made clear its intention to build a Supercenter in the White Slough neighborhood, on the location of a former K-Mart. Given the proximity of the proposed Supercenter to the existing location in American Canyon, as well as the guidelines of the neighborhood plan preventing the construction of a store of this type, the plans for the Nugget in Vallejo continued. However, President Eric Stille made clear to the Vallejo City Council that the approval of the Vallejo Wal-Mart would effectively mean the end of the Vallejo Nugget.

In November 2006, with construction already underway at the Vallejo Nugget location, Stille announced the company would no longer build a Nugget in Vallejo, citing a City Council deadlock vote on whether to approve the Vallejo Wal-Mart. Stille stated that with the construction of a Vallejo Wal-Mart, there simply would not be enough grocery dollars in Vallejo to make a Nugget financially feasible.

His comments and actions resulted in a backlash from the city residents. Supporters of the Vallejo Nugget cited the lack of upscale grocery options in the city, and the need to head down into the East Bay or up to the Vacaville Nugget for gourmet goods. Opponents derided Stille's actions as unwarranted, claiming that Nugget feared that its customer service or products would not be good enough for Vallejo consumers. Others accused the Nugget of trying to blackmail the city in order to maintain their virtual monopoly on discount grocery goods in Vallejo.^[5]

Locations

Active Nugget Market stores

• Downtown Woodland - 157 Main St., Woodland, California
• El Macero - 409 Mace Blvd., Davis, California
• Lake Crest - 1040 Florin Rd., Sacramento, California
• Southport - 2000 Town Center Plaza, West Sacramento, California
• Park Plaza - 771 Pleasant Grove Blvd., Roseville, California
• Browns Valley - 130 Browns Valley Pkwy., Vacaville, California
• Oak Tree - 1414 E. Covell Blvd., Davis, California
• El Dorado Hills - 4500 Post St., El Dorado Hills, California
• Elk Grove - 7101 Elk Grove Blvd., Elk Grove, California

Active Food-4-Less warehouses

• 5184 Sonoma Blvd., Vallejo, California
• 451 Pioneer Rd., Woodland, California
• 3333 Coach Ln., Cameron Park, California

Defunct stores

• Riverside - 6419 Riverside Blvd., Sacramento, California
• Hillsdale - 5731 Hillsdale Blvd., Sacramento, California

References

1. ^ "100 Best Companies to Work For 2007: Full List". CNN. http://money.cnn.com/magazines/fortune/bestcompanies/2007/full_list/index.html. Retrieved 2008-12-06. 
2. ^ "100 Best Companies to Work For 2009: Full List". CNN. http://money.cnn.com/magazines/fortune/bestcompanies/2009/full_list/index.html. Retrieved 2010-09-29. 
3. ^ "100 Best Companies to Work For 2010: Full List". CNN. http://money.cnn.com/magazines/fortune/bestcompanies/2010/full_list/index.html. Retrieved 2008-12-06. 
4. ^ "City of Sacramento - K Street Proposals". May 2005. pp. 2. http://www.cityofsacramento.org/econdev/msc/pdfs/KStreetUpdate_Community051105.pdf. Retrieved 2008-12-06. 
5. ^ Johnson, Kelly (May 6, 2005). "Nugget tells Vallejo to ban super Wal-Marts". Sacramento Business Journal. http://www.bizjournals.com/sacramento/stories/2005/05/09/story7.html. Retrieved 2008-12-05. 

External links

• Nugget Markets website