Feeling Like Family

Kowalski's Markets strengthens the realm of regional independents with unique offerings, cozy confines and civic responsibility

"Our commitment is to bring you an environment that wraps itself around you from the time you walk into the market until you leave the parking lot."

That's the warm and inviting declaration family-owned Kowalski's Markets makes on its website, and it's apparent that the commitment is one the family has gone to great lengths to uphold.

Far removed from the cavernous superstores that seem to dominate the retail grocery scene, Woodbury, Minn.-based Kowalski's instead aims to swaddle its shoppers in cozy sights and scents. Markets in the nine-store chain, located in the MinneapolisSt. Paul metropolitan area, average 20,000 square feet, with individual locations ranging from 12,000 to 48,000 square feet.

"We are adept at getting nearly everything you'll need — from Cheerios to Asian pears — in a small footprint," says Jim Kowalski, co-owner of the chain with his wife, Mary Anne. "Everywhere you turn, there are mouthwatering choices at your fingertips."

Perhaps rather than just supermarkets, Kowalski's offers markets that are just super, in ambiance as well as in offerings.

"We specialize in perishable departments, and local, specialty, organic and natural products," Jim Kowalski explains. "That being said, we are still a full-service, full-option supermarket. We are always on the lookout for the next great neighborhood location."

And meeting the needs of those neighborhoods has been among the company's key milestones since the first Kowalski's Market opened 25 years ago. "Although we have maintained our small, family-owned, community-oriented values, we have evolved our more conventional format into what we are currently," says COO Kris Kowalski Christiansen, the Kowalskis' daughter, "which seems to greatly satisfy a need in the marketplace for taste, quality, sincerity and trust."

That need is further fulfilled by the company's greatest strengths and what its leaders see as its strongest points of differentiation from competitors: a reputation for quality and service, great facilities, high-quality perishables, and an overall fun shopping experience.

"Our markets were created out of our family's love and passion for delicious, healthy foods and inspired by families looking for a place where they'd love to shop and be proud to call their own," Kowalski's declares on its website. "The flow of our markets is designed to be easy and convenient. The environment is relaxed and well organized. It's the kind of place you'll feel comfortable running into for a quick gift or a forgotten item. Most importantly, it's a place where you can shop at your own pace, mingle freely with staff and friends, and discover something new each time you visit."

This formula has delivered, among other things, a fierce loyalty to Kowalski's Markets from its customers, Jim Kowalski says. "During the recession, we maintained sales and profit levels," he notes, explaining that the company streamlined operations to reduce costs but didn't lay off a single employee. "While our competitors were giving the ship away, we maintained our core following."

Smaller size can have its advantages when a company is committed to enriching the community in which it operates. "We're small enough to introduce many local new products and trends to our consumer base while helping local entrepreneurs bring their products to the market," says Mary Anne Kowalski. "We have always put a significant amount of concentration in our produce departments. For many years, we have used local growers seasonally, and have growers in other parts of the country that work with us for new produce item introductions to the market."

But the company accepts an even more profound responsibility to its employees and the community. In 2003, Kowalski's embarked on a leadership initiative that has transformed the way the company's management and employees view themselves.

"We realized there was a bigger obligation to the greater world than merely being a good business partner or employee," Jim Kowalski says. "As an institution, we are obligated to remind people of their role not only as an employee, but also as a citizen of a democratic society. In other words, you are obligated to a whole that needs to stay true to the common good, rather than merely meet individual needs and interests. We have found that this puts more of a transcendent purpose to people's daily work, which translates to great service not only to themselves, but to customers and the community as well."

As such, store associates play a crucial role in building a successful in-store experience for shoppers. "All employees have been through ‘Active Citizens Training,’ a three-hour educational experience that teaches the obligation and responsibility to work for the common good," Jim Kowalski explains. "All executive staff and store management, including department heads, have attended ‘Civics 101,’ a 12-week program that teaches democracy and the power we all have to manage using our core document of identity, principles and standards. The employees are the essential ingredient in our reputation in the community."

That's an important motivator at Kowalski's, one that truly sets it apart from its competitors in a cutthroat grocery retailing environment.

"We operate in a very competitive market against very strong independent operators, and competition continues to surround us with the introduction of national chains such as Trader Joe's, Whole Foods, Target supercenters and Aldi," Christiansen says. "While it may be harder to sustain market share in such conditions, we have sustained our customer base by staying true to our brand and organizational values."

Early on, the Kowalskis knew they couldn't compete with big players on price and volume. "We divorced ourselves from that quite a while ago and decided to concentrate on operational value," Jim Kowalski explains. "We've been able to do that so much better than the big-chain box stores have .... We just evolved into what we thought we could do best. It's foolish for small guys to go after what the big guys do."

To be sure, Kowalski's finds itself thriving — quite a feat in its market, "especially with all the non-union stores, specifically regarding wages and benefits," Jim Kowalski notes.

That's been a key ingredient of the climate change for regional independents in recent years, he continues: "The rapid growth of the chains in our area has reduced the number of independents who can sustain business as usual, and inhibited their growth. We have taken the approach we always have in competing with the non-union chains by being faster; more aggressive with buying, merchandising and vendor relationships; and taking seriously our responsibility to educate our consumers and employees."

In ensuring speed to shelf of new items, Jim Kowalski says, "we find that mostly small independent suppliers are our best partners. We need the everyday goods, and Supervalu is our main supplier of groceries. Otherwise, we use small suppliers for all of our perishable departments."

Providing a unique alternative format also gives Kowalski's an edge. "We have stuck to our principles and values and identity," says Mary Anne Kowalski, "and we offer very warm and inviting stores, with a gift department, the recent addition of wine stores in some locations and always striving for the best produce."

Christiansen adds: "It's nice to be a small family-owned business where you're fast and flexible. We involve employees in our decision-making. We've been strengthening our brand; everyone is committed to it and loves it. Together, we've done a good job staying ahead of trends and keeping our niche safe. There's still a need out there, and we're not going to stray from what we've built for all these years."

The Kowalskis consider social networking important to their continued success. In just a brief amount of time, the company has built up a significant presence on Facebook (its page has nearly 3,000 fans and includes a photo gallery and discussion board), and a somewhat lesser but growing one on Twitter.

Christiansen says meal planning via Facebook seems to be catching on: "Daily at 4, our culinary specialist posts some ideas for dinner, and that's getting some play."

The company's extensive website features store news, announcements of special events, recipes and other resources. It also includes a company history and highlights the family's bold, clearly worded vision that leaves no doubt as to what shoppers can expect upon entering any of the nine Kowalski's Markets: "Whether it's your first time shopping with us, or you've been a loyal customer for years, we promise to always do our best to make you feel like family."

History

In March 1986, Jim and Mary Anne Kowalski purchased a Red Owl Country Store in White Bear Lake, Minn., and converted it to a Kowalski's Market. Faced with competition from large chains and warehouse stores on the horizon, they began the long process of differentiating their stores from the discounters by adding value to the shopping experience.

A central bakery facility was added in 1991 that could supply their stores with fresh bakery products at a great value. In 1993, the Kowalskis built a franchised Cub Foods store in White Bear Township that would assure purchasing power throughout all of their stores. Though the couple knew they could never differentiate themselves in the grocery aisle, Kowalski's was becoming known as the store where shoppers could find unusual or new products.

In August 2000, the Kowalskis' vision or what a grocery store could be was unveiled in Woodbury, Minn.: the first Kowalski's Market built from the ground up. Designed to look like a European village, it featured a glasswalled bakery oven, three restaurant concepts, a department store-quality gift shop, an educational and meeting area, a full-service JUUT Salon Spa, and a Natural Path department offering organic and natural foods and homeopathic remedies.

In April 2002, the Kowalskis acquired GJ's Supervalu, a small chain in the Minneapolis area, and remodeled the stores to mimic their signature theme. In February 2004, Kowalski's Markets expanded to the Minneapolis suburbs with the acquisition of Driskill's New Market in Eden Prairie; remodeling was completed the following November. In June 2005, the Kowalskis opened a market in Stillwater/Oak Park Heights. The most recent market was added in November 2008 in Eagan, bringing the total to nine Kowalski's Markets in the St. Paul-Minneapolis area.

Jim and Mary Anne Kowalski have both received industry honors, Jim as Minnesota Grocer of the Year and Mary Anne as the National Grocers Association Woman of the Year. But they consider their real accomplishments to be building lasting relationships with customers and employees.

Family Ties

The extended management team of Kowalski's Markets includes two generations of the Kowalski family, and members of the third generation are already starting as cashiers and in other entry-level positions. In all, the company employs nearly 1,200 people at its nine stores and its subsidiaries: a transportation department, a central production/bakery facility and an accounting office.

Jim Kowalski, owner

Mary Anne Kowalski, owner

Kris Kowalski Christiansen, COO (daughter)

Doug Clock, CFO

Mike Oase, VP of operations (nephew)

Terri Bennis, VP of perishable operations Carol Lamb, outside sales

Boyd Oase, meat/seafood specialist (nephew)

Mark Wachter, floral specialist/merchandiser

Jerri Mahoney, gift specialist/merchandiser

Diane Odegard, deli specialist/merchandiser

Russ Tourville, bakery specialist/merchandiser

Britt Lindemann, grocery/dairy/frozen specialist

Debbie Leland, natural foods specialist

Roxanne Kielbasa, catering director

Joe Moore, executive chef

Brian Mallie, wine specialist

Laurie Bell, marketing

Tina Fournier,training/HR

Linda Anderson, culinary promotions director

Deb Kowalski, executive assistant (sister-in-law)