In the three years after H-E-B opened its first store in Frisco, the number of new grocery stores built in the Metroplex has increased by 312%, data shows.
DALLAS — When H-E-B entered the North Texas grocery market in 2022, it had an immediate and transformational impact on the way North Texans buy groceries.
Even if a North Texas shopper has never stepped foot in an H-E-B, they’ve felt its impact. The numbers, provided by Weitzman, a Dallas-based commercial real estate group, prove it.
In the three years after H-E-B opened its first store in Frisco, the number of new grocery stores built in the Metroplex increased by 312% compared to the previous three years, data from Weitzman shows.
That’s a good thing, said Bob Young, executive managing director with Weitzman. As grocers become increasingly competitive, building new stores and renovating existing ones, the consumers come out ahead, he added.
“If competition hits you and you’re the other grocers in the space, you look at what they’re doing, and guess what you have to do? You have to play up,” Young said. “You have to become better. Kroger and Tom Thumb and H-E-B are in beautiful competition together in a growth market called DFW. Guess what? The consumer wins.”
Exactly how impactful is the H-E-B effect? Young says it’s helped spur a “grocery gold rush” in North Texas. Across the Metroplex, commercial real estate saw its highest occupancy rate in decades and grocers were the driving force behind the growth, data shows.
H-E-B’s impact on the region can also be measured by the number of eager customers who line up outside its stores before they open. H-E-B shopper Nicole Gibson said the grand opening of the grocer’s newest store in Melissa has been on her calendar for weeks.
“There were 450 people on our 8th store that we’re opening, waiting in line with the first one starting at I think 3 p.m. yesterday,” Juan-Carlos Ruck, executive vice president of H-E-B’s northwest division, said at the opening of H-E-B’s newest store in Celina. “We have something really special here that we have to take care of over time.”
Thus far, H-E-B has taken care of its brand by opening stores in some of the fastest-growing cities in North Texas. The grocer has opened more than ten stores so far, and it has over ten stores in the pipeline, WFAA previously reported.
“If we’ve proven anything over time, it’s that our goal is to serve all Texans, all communities across Texas, and so we’re going to get across all of DFW and we’re slowly making our way, but what you’ll see is hopefully us continue to grow,” Ruck said.
North Texas keeps growing, so Young expects the ever-increasing competition between grocers to intensify in the coming years. Spurred, in part, by H-E-B’s big bet on the region.
“Some people say they’re a real estate company in the grocery business… Whatever the case may be, they’re dominant and their commitment to the great state of Texas is unquestioned. I mean, it’s real,” Young said.
Other grocers respond
On the day of its grand reopening, Kroger’s newly remodeled store in Wylie welcomed customers with special produce displays and expanded offerings. The store’s staff gathered around the grocer’s leadership as they celebrated the completely revamped store.
The remodel, which cost the grocer about $2 million compared with the $40 million it cost to build a new store, was driven by increasing competition.
“That’s the good thing about competition, it helps us stay on top of it, and we want to make sure that we are the best grocer in North Texas,” John Votava, director of corporate affairs with Kroger, said.
The newly remodeled store can hold 35,000 products. Kroger’s goal is to make the story feel fresh, with full shelves, fresh produce, and plenty of room to maneuver.
Kroger enhances about a dozen stores every year, Votava said.
“There is a lot going on in North Texas as far as grocers; everyone is fighting for customers’ attention,” Votova said. “So we want to make sure that we are giving our best effort and showing customers what Kroger is all about and inviting them into our store.”
Kroger has also consolidated some of its stores in recent months, WFAA previously reported. Rob Darnell, vice president of research with Weitzman, said the closures are a reflection of increased competition in the region, which is forcing retailers to close down underperforming stores and gain ground in emerging markets.
Along with redesigning existing stores, grocers are also opening new ones.
‘The consumer wins’
When competition increases, the consumer benefits, Young said.
“The consumer gets better offerings, the consumer gets better pricing dynamics,” Young said.
Shoppers echoed that sentiment. Nicole Gibson, who was excited for H-E-B to open its newest store in Melissa, said she’s noticed the increase in grocery options around her home in North McKinney.
“Everywhere you turn, there’s a grocery store. H-E-B has excited everyone because it’s new,” Gibson said.
Grocers are innovating to give consumers what they want, which is often convenience, Young said. Last-mile delivery is one way grocers are trying to outpace their competition and give consumers a better experience.
“It’s all about the consumer,” Young said. “The consumer wants to buy what they want, when they want, and have a great experience. (They want) convenience and visibility.”
H-E-B, with its popular products and cult-following, has an edge when it comes to differentiating itself from its competition, Young said.
“H-E-B is iconic in the great state of Texas,” Young said. “The H-E-B effect is that they’ve got that special differentiation, merchandizing (and) offerings.”
After a career in the military, Ruck said he was used to competition. But nothing compares to North Texas’ grocery market, he said.
“This is one of the most, if not the most, competitive grocery market in the United States,” Ruck said. “All the players are here. They’re continuing to grow. We understand that all of us have to continue to meet the needs of the customers, and it’s changing.”
Kroger, for its part, has invested heavily in delivery by building and investing in a fulfillment center in southern Dallas.
“That gives people a little bit more flexibility in their daily life to weigh their options,” Votava said.
Despite the competition, grocers continue innovating with one goal in mind: Attracting and keeping customers. In the end, Young says, customers win.
“If we take care of our customers better than anybody else and hopefully they reward us with their business, and that’s how we think about it,” Ruck said.
Great Job & the Team @ WFAA RSS Feed: news Source link for sharing this story.
