HEB Grocery Company, LP, also known as HEB Grocery Stores, is an American privately held supermarket chain based in San Antonio, Texas, with more than 350 stores throughout the U.S. state of Texas, as well as in northeast Mexico. The company also operates Central Market, an upscale organic and fine foods retailer. As of 2013, the company has a total revenue surpassing $20 billion USD (2013). H-E-B ranked No. 15 on Forbes' 2014 list of "America's Largest Private Companies." H-E-B was named Retailer of the Year in 2010 by Progressive Grocer. Supermarket News ranked H-E-B No. 13 in the 2008 "Top 75 North American Food Retailers." Based on 2014 revenues, H-E-B is the twentieth largest retailer in the United States. It donates 5 percent of pre-tax profits to charity. Until 1976, it was closed on Sundays and did not sell alcohol.
History
The company was founded on November 26, 1905 when Florence Butt opened the C.C. Butt Grocery Store on the ground floor of her family home in Kerrville, Texas. In 1919, Howard Edward Butt, Florence's youngest son, took over the store upon his return from World War I. Shortly after becoming owner of his mother's small store, Howard tried four expansions into Central Texas, including one in Junction, all of which failed. Finally in 1927, Howard launched a successful second store in Del Rio, Texas followed by the purchase of three grocery stores in the Lower Rio Grande Valley. The first initials of Howard E. Butt became the name of the store.
Charles, the younger son of Howard E. Butt, became president of the H.E. Butt Grocery Company in 1971. As of 2016, Charles Butt is chairman and CEO of HEB Grocery Company, LP, having grown the business from annual sales of $250 million in 1971 to $13 billion in 2006. In 2010, Craig Boyan was named H-E-B's President and COO. In 2011, the company was #12 on Forbes's list of largest privately held companies; H-E-B was for many years, until Dell went private in 2013, the largest privately held company in Texas.
Operations
Headquartered in Downtown San Antonio, H-E-B operates more than 300 stores in over 150 communities across Texas. As of late 2010, its operations serve approximately "55-plus" percent of the Texas market, according to Progressive Grocer, with primary Texas markets including the Corpus Christi, San Antonio, Austin, Laredo and Houston metro areas. The company does business in 5 different retail formats: general H-E-B stores, Central Market, H-E-B Plus, Mi Tienda and Joe V's Smart Shop. In 2010, the company announced plans to build 19 new stores in Texas. H-E-B opened its first store outside of Texas in 1996, a 24,000-square-foot (2,200Â m2) H-E-B Pantry store in Lake Charles, Louisiana; though the expansion was, in comparison, short lived and ultimately did not catch on with either planners or the community. The H-E-B Pantry store format was discontinued in 2000, and the company closed its sole Louisiana store in 2003. Recently H-E-B offered consumers the opportunity to vote on possible designs for new stores as they expand into new communities.
The company operates several manufacturing facilities in Texas, including one of the largest milk and bread processing plants in the Southwest. H-E-B produces many of their own-brand products, including milk, ice cream, bread, snacks, and ready-cooked meats and meals. These and other private-label products are sold under various brands, including "Central Market Naturals", "Central Market Organics","H-E-B", "H-E-Buddy", "Hill Country Fare", "H-E-B Creamy Creations" ice cream, "H-E-B Mootopia" milk, and "H-E-B Fully Cooked."
Several stores include multi-tenant operations through third-party lease arrangements. Many stores include a bank operation and cellular kiosk. Common nationally recognized tenants include Sprint-Nextel, IBC Bank, Enterprise Rent-A-Car, Panda Express, Chase Bank, Flexi-Compras, Auntie Anne's Pretzel, AT&T, Gold & Silver Buyers, Wells Fargo, and Maui Wowi.
The H-E-B corporate offices have more authority over decisionmaking at individual H-E-B outlets in San Antonio than Foodarama does over individual La Fiesta chains in San Antonio. Because H-E-B is a regional chain, Elizabeth Allen of the San Antonio Express-News said that it is more "nimble" than national grocery companies such as Albertsons.
Central Market
In 1994, H-E-B introduced its Central Market concept in Austin. Based in Austin, Central Market offers an organic and international food selection, including a European-style bakery and extensive wine and beer selections. The chain is now composed of eight stores, two in Austin and one each in Dallas, Fort Worth, Houston, Plano, San Antonio, and Southlake. H-E-B operates four different formats of stores that introduce general merchandise and elements of the Central Market concept: The Woodlands Market in The Woodlands in Montgomery County, Kingwood Market in the Kingwood section of Houston, and the Austin-Escarpment store in south Austin. A fourth store opened on March 22, 2008 in West Lake Hills, and in 2009, the H-E-B in Bee Caves was remodeled. H-E-B's Alon Market opened on October 17, 2008 in San Antonio. In October 2007, H-E-B opened its Cypress Market store, located at the intersection of Highway 290 and Barker-Cypress. In November 2007, the 112,000 sq ft (10,400 m2) Vintage Market store opened in northwest Harris County in greater Houston. In November 2012, H-E-B opened its second Cypress store, Fairfield Market, located at the intersection of Highway 290 and Mason Road to serve the master-planned community of Fairfield and surrounding areas.
In July 2015, the Market concept was expanded as a new Spring Creek Market was opened in southern Montgomery County in Spring, Texas on Rayford Road adjacent to the new Texas State Highway 99 to serve the expanding suburb of Houston.
H-E-B Plus!
In 2004, the company launched three (in Austin, Corpus Christi, and Waco) H-E-B Plus! stores with an expanded focus on non-food categories, such as entertainment and other general merchandise. The company added three additional locations in 2005 (Corpus Christi, Round Rock and San Antonio). The stores offered several new departments including Do-It-Yourself and Texas Backyard, and greatly expanded product categories in baby, card and party, cosmetics, entertainment, housewares and toys.
Several other locations were later added, including stores in Flour Bluff, Corpus Christi, Bastrop, Beaumont, Belton, Boerne, Katy, Killeen, Cypress, Victoria, Kyle, Laredo, Leander, Mission, Rio Grande City, San Juan, San Antonio, Midland, Pearland, and Copperas Cove.
Mi Tienda
In 2006, H-E-B opened Mi Tienda in South Houston (adjacent to Pasadena) in Greater Houston - a 63,000-square-foot (5,900Â m2) Latino-themed store. Another Mi Tienda opened in north Houston in 2011; it is twice the size of the original location, and has 97,000 square feet (9,000Â m2) of space. This second location is off of Little York and U.S. Route 59. Mi Tienda, which means "my store" in Spanish, includes a panaderia that offers homestyle Mexican baked goods; a tortilleria, where employees make fresh tortillas; and a carniceria filled with marinated cuts of chicken, beef and pork. In addition, Mi Tienda also houses the Cocina restaurant, which serves tacos, tortas, carnitas, tamales and chicharrones, and an Aguas Frescas Bar that offers freshly made drinks.
Joe V's Smart Shop
In 2010, H-E-B opened Joe V's Smart Shop, a brand featuring discount items modeled after discount grocer Aldi. The first location opened was a 54,690-square-foot (5,100Â m2) store located in northwest unincorporated Harris County, Texas, near northwest Houston. The store format is smaller compared with a full service H-E-B store but double the size of an H-E-B Pantry store. A larger, second location with a 65,714-square-foot (6,100Â m2) space opened in December in northeast unincorporated Harris County, Texas. As of 2016, there are seven Joe V's stores. The "Joe V" name was based on the name of an executive of the company who was involved in the development of this store format.
Mexico
H-E-B crossed the $1 billion mark annual sales mark in Mexico in 2012.
Litigation
In the mid-1980s, local grocery chains Handy Andy and Centeno joined a lawsuit against H-E-B citing unfair pricing practices. H-E-B eventually settled the suit out of court with Centeno in 1998 for $6.5 million and with Handy Andy for an undisclosed settlement amount.
H-E-B has paid $12 million to settle a whistleblower lawsuit accusing the San Antonio-based grocery chain of Medicaid fraud. Since at least 2006, according to the suit, H-E-B allegedly submitted to Texas Medicaid inflated prices on thousands of claims for prescriptions it filled so the company could obtain higher reimbursements than allowed.
Charitable activity
Historically, the company is known for its charitable donations, with 5 percent of annual pretax earnings given to causes in the communities it operates in, including education and food banks. An annual charitable program maintained by H-E-B since 2000 is the Excellence in Education Awards, in which teachers, administrators and schools in Texas are recognized with awards totaling $500,000 in contributions in 2009.
H-E-B coordinated donations to relief efforts in the wake of a fertilizer plant fire and explosion in West, Texas. The company donated $50,000 to the American Red Cross and launched a check stand campaign benefitting the organization to get the community involved in the relief effort. The company said in a news release 100 percent of the donations from the campaign will support the American Red Cross’s disaster relief efforts. H-E-B also activated its emergency response units, sending the H-E-B Eddie Garcia Mobile Kitchen and water tanker to West, including donations of meals and water to the victims and first responders.
Gallery
References
External links
- Official website
- H-E-B Plus!
- H-E-B Mexico (in Spanish)
- H-E-B Online Digital Photo Printing
- Joe V's Smart Shop
- H-E-B at YouTube
- Forbes.com Forbes' 2004 List of World's Richest People: Charles Butt
- H-E-B at the Wayback Machine (archived April 5, 1997)
