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Genuardi’s Family Markets, Inc.

Genuardis Family Markets, Inc.

301 East Germantown Pike
Norristown, Pennsylvania 19401
U.S.A.
Telephone: (610) 277-6000
Toll Free: (800) 660-2400
Fax: (610) 277-7783
Web site: http://www.Genuardis.com

Private Company
Founded:
1920
Employees: 5,000
Sales: $650 million (1999)
NAIC: 44511 Supermarkets and Other Grocery (Except Convenience) Stores

Genuardis Family Markets, Inc. is a family-owned grocery store chain based in the Norristown, Pennsylvania, area. Long a family owned enterprise, Genuardis offers a full line of groceries and specializes in prepared foods. Some of the companys stores feature coffee bars, pizza bars, and sandwich stations, and some stores offer delicacies such as imported pasta, polpettes, and cappuccino cake. Genuardis also owns Zagaras Inc., an upscale grocery store chain in New Jersey. The company was recognized in 1999 as Family Business of the Year by the Wharton School of Business and the Pennsylvania Small Business Development Council. More than 7,000 Genuardi employees operate 33 stores in Pennsylvania, New Jersey, and Delaware.

The Huckster Begins a Tradition in the 1920s

Genuardis Family Markets, Inc. began when Gaspare Genuardi and his wife Josephine started growing vegetables on their small farm in Norristown, Pennsylvania. Gaspare began selling his home-grown produce to his neighbors out of the back of his horse-drawn wagon. He became known for his high-quality produce, integrity, and loyalty to his customers, who affectionately referred to him as The Huckster. While other grocers were cutting back the size of their portions, Gaspare was throwing in an extra head of lettuce now and then to show his appreciation. Gaspare eventually hired several drivers to deliver his produce, first by horse and wagon and later by Model T truck.

Gaspare and Josephine Genuardi had nine children, five of whom became involved in the business at an early age. After opening a string of small stores, their sonsCharlie, Frank, Joe, Tom, and Jimopened the first Genuardis market on Main Street in Jeffersonville in 1954, the first independently owned supermarket in the area.

The first Genuardis market was a success and the family quickly set its sights on expansion. The Genuardis used the profits from the first store to open others in the Norristown area during the 1950s. The company was a major family affair; by the 1960s Gaspares grandsons also worked in the stores pushing carts, bagging groceries, and running countless errands according to the Philadelphia Business Journal

Postwar Expansion

In the 1960s and 1970s Genuardis became the largest and most respected grocery-store chain in the Greater Philadelphia area. Genuardi employees were well trained and dedicated. The Genuardis initiated a program known as the Legacy, in which current employees and managers mentored new employees and taught them Gaspare Genuardis original company philosophies, such as the importance of providing customers with outstanding service. The Genuardi culture was always there for us and as we moved into management roles, we wanted to maintain that. We do that today by meeting regularly with both our personnel and customers, recalled Dave Genuardi in the Philadelphia Business Journal

Genuardis was also committed to the communities in which its stores were located. In 1976 it established the Community Cash Back Program in which it awarded cash rebates to local nonprofit groups. Under the program, nonprofit groups collected Genuardis receipt tapes and exchanged them for cash rebates or credit toward the purchase of computer hardware and software. By 2000 the Community Cash Back Program had awarded more than $20 million to 3,500 nonprofit organizations. Genuardis also operated Genuardis Childrens Charities, which donated funds to organizations that benefit children.

Change in the 1990s

In the 1990s Genuardis was faced with stiff competition from a bevy of supermarket chains as well as indirect competitors such as Kmart, Sams Club, and many convenient-store chains. Genuardis restructured to better compete with its competitors. It eliminated unprofitable stores and remodeled others. For the first time since the companys inception, it hired managers from outside the family to oversee its day-to-day operations. The new managers allowed the Genuardis to spend more time interacting with customers, something they considered very important.

Genuardis also changed the way it brought customers into its stores. While it had focused heavily on promoting its low prices, in the 1990s the company promoted its restaurant-like atmosphere and its many product line choices. We want to give customers so many choices that theyll have no reason to go anywhere else Roy Taglialatela, director of perishables and merchandising, explained in Supermarket News. Genuardis built its new stores in middle- and upper-class family neighborhoods, wherein the average household consisted of dual incomes.

The company expanded it private label brands to include over 900 items under the Genuardis, Up Country, and Fresh from the Farm labels. Private-label items ran the gamut from canned and frozen groceries to soda, cereal, and fresh meats. The company maintained that its private label products equaled or exceeded the quality of national brands, but were offered at substantially lower prices.

By 1990 the original Genuardi brothersCharlie, Frank, Joe, Tom, and Jimhad turned the company over to a new generation of Genuardis. The new family membersLarry, Skip, David, Jim Jr., Joe Jr., Tom Jr., Anthony, and Michael Genuardiwere led by Genuardis President Charles A. Genuardi, son of Charlie Genuardi. All of the cousins were shareholders who had worked in Genuardis markets nearly all of their lives. As of 2000, Charles A. remained president of the company.

In 1997 Genuardis launched an interactive Web site that featured an online nutritionist, live cooking classes, and interactive chat sessions. Customers could also order groceries via Genuardis Web site. We entered into this new medium to help us get a better connection with our customers, said Alan Tempest, Genuardis director of marketing, in Supermarket News. He added: Using the Internet has become a way of life for people. We feel that eventually this will be an extensive medium of commerce and a strong selling tool for us.

Upscale Focus in the late 1990s

Genuardis made customer convenience a top priority in its markets. In 1997 it surveyed its customers and found convenience to be extremely important. They were adamant about it, said Roy Taglialatela in Supermarket News. They said it came near to being an insult to ask them to walk across a huge store to buy milk and eggs. To make some of their markets more user-friendly, Genuardis placed refrigeration units stocked with milk, eggs, and other essentials near checkout lines, so customers needing only essentials could enter and exit the store quickly. The company also created a separate entrance into the fresh-and-prepared foods isle and gave this area its own cash register. It even installed a portable cash register in this area to help keep lines short during the lunch rush. The biggest change, however, was in the amount of prepared foods offered in the markets. Genuardis wanted to be more than just a grocery store; it hoped to take business away from the fast-food chains as well. The company quadrupled the space for self-service prepared food and increased the variety of these foods by over 20 percent. Some of Genuardis newer markets had coffee cafes with hanging lamps and high-backed wooden stools; these markets were equipped with espresso machines and floor-to-ceiling windows. Genuardis offered Italian specialties such as poplette, meat lasagna bolognese, stuffed hot peppers, colorful roasted vegetables, ricotta pie, and cappuccino cake. Imported pasta was available at a pasta station. Employees working at a pizza station could be seen tossing pizza dough in the air. Lunching customers could dine at a sandwich station or select a piece of cooked meat from a carving station.

Genuardis prided itself on the freshness of its foods. While the emphasis here is on prepared foods, produce is a good messenger of fresh. Whether its a deli sandwich or a meal, its freshness the customer is buying. And it all comes back to produce, explained Bill Chidley, the vice-president of Design Forum, a firm that helped Genuardis conceptualize its new stores.

Company Perspectives:

Genuardiness describes our philosophies, our culture, and the way we do business. Although the word is new, Genuardiness began in 1920, when Gaspare and Josephine Genuardi started what is now Genuardis Markets. There are basically twelve characteristics that set Genuardis apart from other supermarkets. Twelve advantages that, together, create something called Genuardiness. Its these twelve points that keep customers coming back, assuring a strong, successful future for Genuardis Family Markets and everyone who works here. (1) Genuardis food is better; (2) Were known for superior freshness; (3) Were a value-added food store; (4) Were fashionable, yet not upscale; (5) We offer no-hassle shopping; (6) We deliver satisfaction; (7) Our goal is Legendary Service that goes beyond what customers expect; (8) Customers enjoy shopping at Genuardis; (9) We offer Genuardis Value; (10) Were part of the community; (11) Our Family Pride Makes the Difference; (12) We play to win and never forget that were in a tough, competitive business.

During this time, in 1997, Genuardis made its first major acquisition, purchasing Zagaras Inc., an upscale grocery chain in New Jersey. Zagaras was known for its deli, bakery, sea-food, and high-quality meats. The stores also carried a large variety of vitamins, herbs, and nutritional products. Analysts concluded that the Zagara acquisition demonstrated Genuardis plans to move into an upscale market. Genuardis decided against changing the Zagara name and planned to open additional Zagara markets in 2000.

The Genuardi family said it was impressed with the amount and quality of prepared foods Zagaras offered its customers. They do an incredible job at preparing foods, so this gives us an edge over our competitors Acme and Superfresh, said Larry Genuardi in the Philadelphia Business Journal. Were following the trend in society where people are so time-sensitive; its driving fast foods and restaurants of all kinds all over the country. With our Zagaras products people get fresh quality food and they get it very quickly. Its just another way of reinventing ourselves explained Larry Genuardi in the Philadelphia Business Journal.

At the Genuardi stores, the company opened its first glatt kosher deli department in 2000, featuring a full line of smoked fish and specialties salads, kosher meats, poultry, lunch meats and breads. The kosher deli was certified kosher by the Organized Kashruth Laboratories (OK Labs). Moreover, believing atmosphere to be very important, the company planned to remodel many of its stores in 2000. Genuardis newer stores boasted glass towers with sculptures of fruit and vegetables so large they could be seen from major highways. The company hoped the sculptures would remind customers of Genuardis commitment to freshness.

In 2000 Genuardis announced its position regarding genetically modified organisms (GMOs), food irradiation, and organic standards, becoming the first grocer in the United States to take a stand on the issue. Specifically, company management decided to make efforts to eliminate irradiated ingredientsfood exposed to radiation to kill bacteriafrom its product line. The company also stepped up efforts to inform its customers about food content through more thorough labeling. We believe consumers have the basic right to know relevant information that will affect their personal food choices. We also recognize the significance of individual food preferences, and therefore, we want to guarantee choices for our customers to the best of our ability, explained Charles Genuardi in a company press release. Genuardis had begun selling organic food in the early 1990s. In 1998 Genuardis was awarded the Big O award by the Organic Trade Association for excellence in promoting organic foods.

As they approached a new century, Genuardis markets were known for the integrity, quality, and low prices. The company operated 33 stores in Pennsylvania, New Jersey, and Delaware, and the Genuardi family was still closely involved in the companys operations. Genuardis planned to open five additional stores in the year 2000. Genuardis Markets was recognized as Pennsylvanias Family Business of the Year by the Wharton School of Business and the Pennsylvania Small Business Association in 1999, when it also received a Salute to Excellence from the Private Label Manufacturers Association for its private brand product line. In 2000 the company received the Purple Aster Award from the Sons of Italy. The Genuardis were proud of their companys success but also careful not to take it for granted. With the supermarket business being extremely competitive and with the growing popularity of online grocery services, all players in the industry faced challenges. As Larry Genuardi explained in the Philadelphia Business Journal, one of the companys biggest challenges was in dealing with nine distinct ownersmeaning Charles A. Genuardi and his eight cousins. Were constantly trying to keep our unity and so far, its worked, said Larry Genuardi, adding You hear all these horror stories from other large family businesses, where it turns into people looking out for their own personal interest. Here the company comes first, the individual owners dont. We understand our strengths and weaknesses and the leadership comes from Charles.

Principal Subsidiaries

Zagaras Inc.

Principal Competitors

Acme; Super Fresh; Pathmark Stores, Inc.

Key Dates:

1920:
Gaspare Genuardi earns his living selling produce by horse and wagon.
1954:
Gaspares sons open the first Genuardis market.
1976:
Genuardis establishes its Community Cash Back Program.
1997:
Company purchases Zagaras Inc., and launches its Web site.
1999:
Genuardis Family Markets Inc. is named Family Business of the Year.

Further Reading

Conway, Terry, Producing Profits at Genuardis; Building a Legacy, One Generation After the Next, Philadelphia Business Journal, 28 May 1999, p. B1.

Family Businesses of the Year Named by the Pennsylvania Small Business Development Centers, PR Newswire, March 20, 2000.

Genuardis Glatt Kosher, Progressive Grocer, January 2000, p. 14.

Harper, Roseanne, Happy to Oblige, Supermarket News, March 10, 1997, p. 29.

Tracey Vasil Biscontini

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