Franktown-based grocer thrives in lean times

Chris Michlewicz
Posted

An ability to adapt to emerging economic and demographic trends has kept a Douglas County-based company thriving for 75 years.

Leevers Supermarkets, a family-run independent grocer headquartered in Franktown, has embraced numerous store formats and nearly as many names over the years: Leevers SuperValu, County Market, Warehouse Foods, Colorado Ranch Market. Its latest incarnation – Save-A-Lot – could be the most promising.

The no-frills franchises, which Leevers Supermarkets operates under a license agreement, are among the only “hard discount” food stores in Colorado, and their exponential growth in middle- to low-income communities is a reflection of the tough economic times many families are experiencing.

Save-A-Lot bills itself as “value-oriented” rather than service-focused, said John Leevers, president of the company. The stores don’t have a pharmacy or customer service counter, and shoppers must bag their own groceries. More and more budget-crunching consumers are willing to make the trade-off for prices that are an average of 40 percent below larger grocery chains such as King Soopers, he said.

Instead of managing 40,000 in-store products with sales-induced price fluctuations like its counterparts, Leevers Supermarkets keeps things simple with about 3,000 items at consistently low prices. The stores carry a limited assortment of each product, but by brokering deals with major suppliers, the Save-A-Lot chain is able to drive down prices. It also becomes the largest purchaser of, for example, 24-ounce squeeze bottles of ketchup, which research shows is the most in-demand item of its kind.

The bare-bones business model is clearly working. Leevers Supermarkets had six stores in 2008. On Feb. 20, it will open its 15th store, all of which are on the Front Range between Pueblo and Greeley. Last year, the company grew to 400 employees, and with four more stores planned in the next 18 months, the Leevers will hire another 100 people.

Leevers Supermarkets is one of about 50 companies in Douglas County with 250 or more employees, said Becky Nelson, economic development specialist for the county. However, it does have one quality most of the other large employers can’t claim. It has been family run from the beginning.

Unlike many businesses, Leevers Supermarkets was helped by the economic downturn. Real estate prices plummeted as consumers sought out better deals on food.

“People were searching out value, they were looking for stores like us to save money and we give them significant savings over our competition, so we had this increased demand at the same time we had this real estate cost going down. It really opened a lot of doors for us,” Leevers said.

A tailored approach to running each individual location has endeared Save-A-Lot to its shoppers, many of whom live in Hispanic communities. Stores in those communities have different meat and produce departments, and Leevers Supermarkets buys products made in Mexico that Save-A-Lot does not carry.

“Grandpa’s thing over the years was to really tweak the store to the neighborhood that we’re in and really serve that local customer in that neighborhood, and that's why we get the different formats,” said company vice president Chris Leevers, referring to founder Norm Leevers, who began the family’s first store in January 1938 in North Dakota. “When we were in Boulder, we had a sushi bar and a coffee bar.”

Norm Leevers passed the business to his sons, Jack and Bob, who ran the operation before passing it to Jack's sons, John and Chris Leevers. The third-generation proprietors first began working in the stores at age 13 or 14, starting from the bottom.

With roots firmly planted in North Dakota, it took nearly five decades for Leevers Supermarkets to branch out into Colorado. The first store opened in Pueblo in 1984. The grocer moved its home-based administration office in 1997 into the Clocktower building on the northwest corner of Colorado 83 and Colorado 86. It was seen as a central location between Pueblo and Loveland, then its northernmost store.

Up until Jan. 1, Leevers had been a family-owned company. The family recently formed an employee stock ownership plan and sold all of its shares to those who have been instrumental in the company’s success, Chris Leevers said. Twelve of the employees are based in the Franktown admin office and the rest generally live in the communities being served by the store.

As for the future, there is plenty of opportunity for Save-A-Lot to expand its presence in the west. Roughly 1,000 of the chain’s 1,400 stores operate east of the Mississippi River.

“Our grandfather always said that there are only two directions you go in this business: forward and backward,” John Leevers said. “There’s really no such thing as standing still. So we’re always looking to grow and change and reinvent ourselves.”

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