Supermarket retailer Hy-Vee Inc. is entering into two strategic partnerships that it says will strengthen its commitment to bringing customers increased access to culinary expertise, health-and-wellness choices, and new customer experiences.
As part of this effort to diversify its business model while reinforcing its mission of making customers’ lives easier, healthier and happier, Hy-Vee plans to build, own and operate 26 Wahlburgers restaurants, nearly doubling the brand’s current locations. Hy-Vee will also add select Wahlburgers menu items in all of its in-store Market Grille restaurants.
In addition, Hy-Vee will partner with Orangetheory Fitness to provide customers with convenient access to an intensive group-fitness program in or adjacent to Hy-Vee stores.
“These unprecedented collaborations reinforce our company’s longstanding commitment to health and wellness, culinary expertise and customer experience,” said Hy-Vee Chairman, President and CEO Randy Edeker. “However, they also represent a bold step to deliberately evolve our business to meet the change in our customers’ lifestyles and spending habits. These partnerships keep us on the leading edge as the retail grocery industry evolves.”
Changing Retail Landscape
Last year, eating meals outside the home surpassed meals consumed in the home. According to the Bureau of Labor Statistics, grocery spending trends began to shift in 2014. Millennials have played a significant role in that evolution, spending 44 percent of their food dollars annually on eating out, according to the Food Institute’s analysis of the USDA food expenditure data from 2014.
That increase has skyrocketed income spent in restaurants and on takeout meals, which has risen from 34 percent in 1974 to 50 percent in 2014.
“There is a changing landscape in the retail industry,” Edeker said. “Hy-Vee has a responsibility to our customers, employees and communities to look for new ways to strengthen our company. With this type of progressive action, Hy-Vee is well positioned for future growth.”
Wahlburgers is a family-friendly restaurant that offers a unique dining experience featuring signature burgers and drinks in a casual environment. Currently, Wahlburgers operates 17 locations in nine states and Canada.
Hy-Vee will build, own and operate 26 Wahlburgers in seven Midwestern states, becoming the brand’s largest single franchisee. In addition, all 84 Hy-Vee Market Grille restaurants will offer Wahlburgers-branded menu items. The Wahlburgers restaurants will complement Hy-Vee’s Market Grille restaurants, and tie into the organization’s commitment to providing culinary expertise and experiences.
‘A Great Partner’
“I would personally like to welcome Hy-Vee to the Wahlburgers family,” said Paul Wahlberg, chef and co-founder of Wahlburgers. “It’s a great honor to be able to partner up with a company that has a long and successful history in the two areas that are very important to Wahlburgers, quality and customer service.”
The first Hy-Vee-owned Wahlburgers will be located in the retailer’s headquarters city of West Des Moines, Iowa, and open in mid-2018.
“Hy-Vee has been a great partner for us with our Performance Inspired Nutrition line. Their commitment to quality and innovation shows in everything they do,” said Mark Wahlberg, actor, producer and co-founder of Wahlburgers. “I can't think of a better fit for Wahlburgers to introduce our family's hospitality to the Midwest."
Orangetheory Fitness is a fitness program offering an intensive group-training workout. With 750 studios open nationwide, the company is on track to open 1,500 in the next two years.
Hy-Vee will partner with Orangetheory to offer customers a fitness experience in or adjacent to Hy-Vee stores. In addition, Hy-Vee dietitians will work with Orangetheory members to offer dietetic services, provide samples of nutritional products and lead store tours to showcase items that align with member needs.
This partnership creates an integrated fitness component to bolster Hy-Vee’s focus on health and wellness, including in-store dietitians, HealthMarkets, chefs, fresh and organic produce, and pharmacies.
The first Hy-Vee Orangetheory Fitness location will open in 2017 in Minnesota’s Twin Cities, a significant growth market for the retailer.
“Orangetheory is a revolutionary fitness experience, which, combined with Hy-Vee’s health offerings, creates a one-stop shop for wellness,” said Orangetheory Fitness Chief Brand Officer Kevin Keith. “Like our members, we know that many Hy-Vee customers are looking for more convenient ways to access fitness and healthy eating options in one location – this partnership solves that need.”
Innovation has become especially important to Hy-Vee as customer lifestyles and attitudes toward retail shift. In addition to these partnerships, Hy-Vee will continue to explore new ways to evolve while maintaining its core focus.
“At Hy-Vee, we are committed to meeting our customers where they are – whether that is in a retail grocery environment, restaurant or online through our Aisles Online program,” said Hy-Vee EVP of Strategy and Chief Merchandising Officer Jeremy Gosch. “These partnerships are just another example of Hy-Vee listening to the needs of our customers.”
Boca Raton, Fla.-based Orangetheory Fitness is a scientifically designed, one-of-a-kind group personal training, interva-fitness concept offering a 60-minute workout broken into intervals of cardiovascular and strength training.
Hingham, Mass.-based Wahlburgers was founded by Executive Chef Paul Wahlberg, his celebrity brothers Mark and Donnie, and other investors. Wahlburgers offers a fun, casual music-filled atmosphere and a menu featuring a variety of fresh burgers, housemade condiments, crispy haddock, seared chicken and vegetarian options, along with thick creamy frappes and floats.
Hy-Vee Inc. is an employee-owned corporation operating more than 240 retail stores across eight Midwestern states with sales of $9.8 billion annually.