PG WEB EXTRA: Nonprofit Center

Choosing Chester

As an underserved area, Chester, Pa., was desperately in need of a full-service supermarket, which the city had been without since 2001, but since it was one of 35 food deserts in the Delaware Valley, how was it chosen as the site of hunger relief agency Philabundance’s first nonprofit grocery store? (At left, a view of the store from across the street, where a shuttered business provides evidence of the area's economic malaise.)

“It was a combination of factors,” explains Bill Clark, president and executive director of Philabundance. “Certainly, the need in Chester was substantial. As a food bank, we were distributing over 1 million pounds a year of charitable food in Chester, so we knew the need was there. The administration, the community, had never given up on the idea of getting a supermarket, so there was a huge kind of base of support for bringing a supermarket [here]. It was also in the 1st Congressional District, which is Congressman Bob Brady’s district, and his district we’ve pointed out as one of the hungriest districts in the nation, so we had his support. … The difference between Philadelphia and Chester is that it was a little bit more isolated, and could give us a lot more of a test bed where we could develop this model and calibrate it and work out all the nuances of what we don’t know, without having it being a very large city like Philadelphia.”

Once the location was chosen, the process of setting up a grocery store began – but it was anything but fast. “From the original conversations, it probably took us about seven years,” admits Clark. “Now, that’s a long time to open up a store, but it is also our first store, so it was really a new concept as well as a new location, and we didn’t have the depth of retail experience that you would have, and as a nonprofit, we had to go through, for two or three years, the internal strategic considerations of whether this [was] even something that we wanted to do, or could do, or could pull off, and, it took us a while to gain kind of a collective consensus that that’s something we should do, and then we had to figure out how to do it.”

After the way forward was decided, however, another factor added to the length of the undertaking. “Then, of course, for us, the fundraising component took longer,” notes Clark. “It’s not like you’re a commercial operation, you line up your investors, and, boom, you’re there -- we did this totally with donations, whether they were government or charitable donations, so it took a long time to then talk to those potential donors and explain to them the concept, because it was a new concept.”

Going forward, the store will serve as a laboratory of sorts, charting customers’ adoption of healthier eating practices.

“In a lot of areas, improving nutrition and eating habits is a function of education,” notes Clark. “We believe that merchandising, and the tools that are available to the commercial business, are what really moves it. I’m more interested in looking at skim milk in a share-of-market battle against whole milk than I am looking at educating to tell you that skim milk is better for you. To know whether I’m successful at influencing behavior, I need to have that longitudinal data” derived through Fare & Square’s free Carrot Club membership.

On the Job

When it came to finding staff, Fare & Square was determined to hire locally, but finding qualified employees presented a bit of a challenge, so the nonprofit grocery store turned to job training.

“We wanted to hire as much as possible from the community,” notes Bill Clark, Philabundance president and executive director, “but we realized that the workforce in the community that we were accessing had a long history of unemployment, were not very skilled, did not have retail store experience, and so we partnered with the city, the Career Link operation with the city, and we recruited for a five-week job-training program, and then we tried to hire as much as possible from that graduating class.”

“Chester’s been losing jobs and population for the past 30, 40 years, probably,” says Store Team Leader Noah Langnas. “We have [69] employees, many of whom went through a five-week unpaid training course. It wasn’t retail grocery training; it was like life-skills training. They learned how to do a resume and a cover letter, they learned how to do mock interviews, they learned about food safety, they learned about customer service, different things like that. What we found was, when we interviewed those who went through the class -- and they were told, ‘If you go through this class, you’re not guaranteed a job’ – 44 people graduated, of which we hired 36, by the way, which I’m very proud of.”

Asked what made the difference between job candidates who underwent the training and those who didn’t, Langnas replies that in interviews, program graduates “did much better, they were much better prepared, their resumes were prepared a heck of a lot better, those types of things, and it was easy to hire those folks.”

Once the employees had been hired, though, they required specific retail training, so Fare & Square looked to UpLift Solutions, the national nonprofit organization founded by Jeff Brown, of Westville, N.J.-based Brown’s Super Stores Inc., a member of the Wakefern Food Corp. retail cooperative and a pioneer in bringing for-profit grocery stores to underserved communities in the greater Philadelphia area.

UpLift helped with “everything from store layout, consulting, to job descriptions, people -staffing plans,” says Clark. “When we trained folks, since I didn’t have another store for them to get started at, we sent all of our cashiers and a lot of our dairy people, a lot of our managers, to ShopRites, where they did a mini week[-long] apprentice[ship], so they could get real hands-on experience of working in a grocery store, … and they got a real sense of what it was to deal with customers.”

“UpLift provided workforce development to Fare & Square’s associates and also assisted the management team in developing operational strategies to ensure long-term success of the store,” affirms Mike Basher, the organization’s director of community development, whose group worked closely with the trainees. “By developing entrepreneurial solutions, we assist many clients throughout the country seeking to increase food access and have seen firsthand the positive impact these types of projects have on their surrounding communities.”

Although their approaches to the problem of underserved communities are different, Clark has nothing but praise for Brown, who he believes has “done a fantastic job of fighting food deserts, even at the edges of what’s possible. He’s been able to come further into food deserts than just about any other commercial operator. And yet there are still areas that even he can’t make work, and that’s where we said, ‘Listen, we don’t want to want to compete with Jeff; we want to augment, we want to be a Zen, AC/DC to him.”

As a result of the efforts Fare & Square made to hire from the community, “82 percent of our team members live right here in Chester,” Langnas points out. “When I went to talk to the mayor and the councilpeople, I said, ‘We’re bringing two things to Chester; we’re bringing food and jobs.’ And there were some other companies in Chester that promised jobs and didn’t quite deliver, so we did what we said we were going to do -- we brought foods and jobs -- and we’re really proud of that 82 percent number.”

He’s equally proud of the many “great success stories in the store, people who hadn’t had jobs for four, five, six years” who are now gainfully employed at Fare & Square.

According to Produce Team Member Doretha Brown, who went through the training, Fare & Square is “just a wonderful place to work. I like meeting the people and seeing their happy faces. Everybody’s so happy just to have a market.”

As Clark puts it, “We’re based here in Chester; we see ourselves as a Chester citizen; we’ve gone to great lengths to hire from the Chester community, independent of previous experience; and we’re building and living this for the benefit of the Chester community.”

Silver Linings Playbook

Fare & Square’s associate – or team member -- culture is all-inclusive, thanks in large part to the enthusiastic guidance of Noah Langnas, who manages the store and serves as its head cheerleader. Langnas, who calls himself “an old Acme Markets guy,” was actually consulting when he heard about the Fare & Square project through another consultant who was working on it. “As soon as I read the job description -- I wasn’t looking for a job at the time – it was instantly something that I wanted to be a part of,” he recalls.

The emphasis on teamwork is a reflection of employees’ willingness to go above and beyond and pitch in when necessary. “That’s why my title isn’t ‘manager,’ it’s ‘team leader,’ and we have team members,” says Langnas. “I know it’s semantics … but it’s the culture that we’re trying to develop here.”

In keeping with that sense of shared responsibilities, “I’m very hands-on,” notes Langnas. “You missed me earlier stocking the meat case. I like to get my hands dirty. I bag, I mop floors. … When I started at Acme, I started as a bagger, cleaning bathrooms and pushing shopping carts. And now I’m running a [multimillion-dollar] project. So, at the end of the day, I think if you do those kinds of things, it builds respect, and when you build respect, you build loyalty.”

He also makes sure to boost morale by psyching up his team members. According to Langnas, “Before we opened, we had a team meeting in the produce department, I gave like a little pre-game warm-up speech, and I was yelling, ‘Who are we?’ and they were all yelling, ‘Fare & Square!’ We had the building rocking and they were all pumped up. This is the part of the job that I enjoy. A day like today, when both my meat cutters call in sick, that’s a part of the job that I don’t enjoy – we’re scrambling; one of them’s on the way – but I’m still smiling.”

Not surprisingly, Langnas is also fond of “working with people, making sure they find what they’re looking for.”

Another key element of Fare & Square’s employee culture is allowing certain amount of independence. “Before, there was a playbook, and you just had to execute it,” says Langnas. “Here, we’ve written the playbook and we’re executing it, so if [a team member wants to work directly with a supplier], we give him the autonomy to say, ‘OK, here are the prices; now can you get in something cheaper?’ you know, [work with] different suppliers. It’s not like we have to use the corporate supplier. [They’ve] got the autonomy to make decisions.”

The Shape of Things to Come

Fare & Square has been open for only a short time, but it’s full of big plans for the community – and possibly beyond.

In addition to the store’s teaming up with the local Hillside Farm and its “Seed to Snack” program targeting schoolchildren (see the Store of the Month feature “Cornering the Market,” in the November 2013 issue of Progressive Grocer), Store Team Leader Noah Langnas mentions a partnership with Penn State Brandywine: “They might come in once a week or once every two weeks to do some nutritional education.” Store tours might also be in the offing, he adds.

Membership Manager Denina Hood expands on some of the planned initiatives. “We’re looking into – there’s a lot of things we want to do – we’re going to have SNAP outreach, someone will be here at least once a month, or more if necessary, to help people navigate the process, and we’re looking to do some type of [store] tour” to explain how to cook certain items, “so that people aren’t afraid of some of the vegetables or fruit. It would be nice to be able to do that, and we already have some recipes on the website. If we’re doing a special, here’s a [recipe featuring that] vegetable on the website that you can use.”

Hood continues, “We’ve had some of the organizations that we’ve worked with [offer] to come in and do BMIs, blood pressure screenings” and other medical tests.

Confirms Managing Director Paul Messina: We have community outreach services that we’re running at the store. Our No. 1 is SNAP outreach for customers in need, we have nutritional information available on our website, and we’re going to have a certified nutritionist here at the store to talk to people.”

He adds: “We’re pretty far along in the process of partnering with Community Hospital down the street [to have] certain doctors and eye doctors for dental screenings, eye examinations, blood testing -- you name it. We want to be able to send a message to customers and the people of Chester and the surrounding communities that it’s important that they consider what they’re eating and try to live a healthier lifestyle, to try to live a few extra years and enjoy their families and their grandchildren. The message hasn’t really been sent in Chester, so we’re trying to really promote that.”

What about future food and beverage items? Although, according to Messina, demand for natural/organic products is “very little at this point … we are hoping to get into that, in terms of merchandising that product in the store and promoting it someplace down the line. The No. 1 priority we had was, obviously, to get people into the store. We can promote healthy lifestyles, but we can’t force people to eat healthier, so what we’re trying to do is educate our people.”

In terms of technology and equipment, as well as offerings, Philabundance President and Executive Director Bill Clark notes that a deliberate decision was made to keep things simple at Fare & Square, at least to start with. “We went through a lot of discussion about should we make it a LEED building, there was even talk one time about growing organic herbs on the roof, and basically, I nixed almost all of that,” he explains. “I said, ‘Listen, it’s a pretty big business-model challenge and economic challenge to open up a grocery store in an area that thus far hasn’t been able to support a grocery store; let’s do the basics. And you want to get fancy, we’ll talk about that in a second one, but I’ve got to prove viability of the concept.’”

Clark’s mention of future stores raises the question of whether there will be more Fare & Square locations. When he’s asked about the possibility, his reply is circumspect. “When we designed this store, we designed it first, to be large enough to have a significant impact in the community,” he says. “We designed it to try to minimize, or be as sustainable as possible, without ongoing large infusions of charitable funds, and we designed it to be scalable. … I think if we can figure out how to make this work so that it would be scalable, we would be willing to entertain” more stores.

Perhaps more important is that the nonprofit model be adopted by other organizations, which Philabundance would be only too happy to help. “This is not an issue where I can get a return on investment and make wealthy shareholders,” stresses Clark. “We’re owned by the community, which means the intellectual property, all our learnings, are available to the community. We want the community to be better, not to improve wealth. So if our friends in [other areas] think that they have a community that needs this, we would be willing to share with them as much information as we can to improve the likelihood of their success.”

The store’s design and underpinnings could even potentially be part of that assistance. “Now, it’s possible that we have a lot of systems that we have invested in, like the POS system, the customer relationship systems, the Fare & Square logos and identity packages, we might be able to franchise some of that,” muses Clark. “We probably wouldn’t be charging the same franchise fees that we would if we were a commercial operation, but … just from doing this, we have learned so much that probably in some ways it would be silly for a food bank to try this without at least talking to us, because we have a lot of advice to give, and it’s pretty much free.”

One thing is certain: The interest in opening nonprofit grocery stores does exist, as inquiries from several municipalities attest. “There are other people around community food banks that are looking at retail stores as a model,” notes Clark.

As for Chester itself, does Clark see the store as the beginning of an economic renaissance for an area that’s experienced decades of high unemployment and shuttered businesses? “It is, by its very nature, an economic development project,” he says. “We’ve substantially improved the infrastructure of this end of town, we’ve increased the traffic, we’ve increased the lighting, we’ve provided 69 jobs, more than 80 percent of them are from the city of Chester, and we are bringing a tremendous amount of shopping traffic into town, so it’s certainly hopeful that it can serve as a basis of operations as any grocery store would to a greater economic development spread out over time.”

Designed to Succeed

When planning Fare & Square, Philabundance engaged New York-based brand agency and retail design consultancy CBX to create an ambiance that would “reflect the hopeful and respectful nature of Philabundance’s goal to serve Chester residents through a store that could look at home in any community,” according to Joseph Bona, CBX president of branded environments. The resulting store features fixtures, lighting, flooring and other elements that might appear in any for-profit supermarket, with the addition of a unique mural paying tribute to Chester.

Designed by Philabundance and Philadelphia-based LevLane Advertising, the Fare & Square logo, a purple carrot with a green tops and the words “Fare & Square” set in a rounded-corner square, inspired the store’s overall palette of bright green and shades of saturated purple, with splashes of yellow and orange, rounded out by such modern elements as light wood and stainless steel trim. “The palette is designed to make Fare & Square an energizing and inspiring, but comfortable, place to shop and congregate,” noted Bona.

Arriving customers immediately encounter large displays of produce arranged on tilt-style tables, while pendant lighting above draws eyes to the freshness and quality of the fruits and vegetables. A broad assortment of additional produce items are displayed in fresh food fixtures lining the walls. Dairy, deli and fresh meat sections are also included in the perimeter.

Shoppers can easily navigate the store’s center store and frozen food section, thanks to hanging aisle-marker signage and attractive end cap displays. Flooring throughout the store is vinyl, which was chosen to be easy on both the backs and feet of employees and customers.

By the exit, a centralized checkout with multiple lanes helps shoppers breeze through the bagging process. “In the same spirit as we welcome customers through the front door, we also wanted that last image as they exited the store to leave a positive impression,” Bona pointed out, adding, “We designed a neighborhood store that’s clean, well lit, functional, convenient and friendly, but it’s also a place that the community can call their own, instilling a sense of optimism, pride and connection.”

Making Fare & Square look like a for-profit grocery store was crucial, explains Philabundance President and Executive Director Bill Clark. “It was important for us that when our clients – customers -- come in the door, they don’t see this as a charitable nonprofit, they see it as a real supermarket,” he says, “because … there’s a normal shopping behavior that people have because they’re Americans, and we respect customers in ways that we don’t respect clients who are charity cases.”

To help realize this vision of a neighborhood supermarket at which local residents would be proud to shop, Jerry Roller was tapped as the project’s architect. “Jerry’s worked on a number of grocery stores for larger banners in the area,” says Clark.

One major challenge faced by the design team was the space on offer. “We were somewhat limited in the footprint of the store,” admits Clark. “[The] 16,000-square-foot building was really a function of what was available in this old, originally a Penn Fruit, and 8,000 feet of the building was already rented to Family Dollar in a long-term lease, so we had to work around the 8,000-foot carve-out of a 24,000-foot footprint. So we did the best we could. I suspect that we’re probably a little small for the ideal community, but this is the building that was available.”

Additionally, although customer-facing design was a priority for the store, certain bells and whistles – like top-of-the-line energy-efficiency features – weren’t. “Everything that we wanted to do that was extra delayed the day … we could open, because I had to fundraise for all of it, and I couldn’t really justify that I could return on any of that investment, because we didn’t know what the store-operating practice would be,” recounts Clark, “so we basically said, ‘No, let’s try to be single-minded about getting a shopping environment that meets the need of the community, and then if that works, we’ll become energy-sufficient later.’”

Still, in at least one major way, Fare & Square’s design could be considered sustainable. “Environmentally, we recycled this building,” notes Clark. “This building had been vacant for 12 years. Interestingly enough, when we took it over, it had this old refrigeration system that was originally for Penn Fruit, and they used cork insulation, all the refrigerators and freezers were insulated with cork – that’s how old this building was. So we had to rip everything out.”

Community Pride

When Philabundance sought to open a grocery store in Chester, Pa., the hunger relief organization naturally consulted with the community on what it needed from such a venture. One result of this collaboration was the Chester-themed mural adorning one wall of the store, which was created in accordance with residents’ views of their hometown. The store also went to great lengths to hire locally.

“When you’re in an urban market like this, there are demands, and we listen,” notes Fare & Square Managing Director Paul Messina. “We’ve been listening for a long time. We’ve been out in the community, promoting the location and meeting with people, and getting feedback from people as to what they wanted to see. We listen, and we do what the people want us to do.”

“We thought it was important to listen,” echoes Store Team Leader Noah Langnas. “You know, it’s easy to come in with your own ideas and tell people what you think needs to happen, but we did a good job of listening to the community.” That listening included featuring fresh meat and deli when residents requested them at the store.

During Langnas’ listening tours of the community, “I hear all sorts of stories about people having to pay $40-$50 to pay a hack – around here they call it a jitney – to get them back and forth, and there was a mother who has five children and she’s gotta take the bus to get to the store, she’s gotta hire a hack to get home, so how much money is she spending on transportation that could have been spent on food? She only shops once a month, ’cause it’s such a hassle. So how much fresh produce is she buying? Not a whole heck of a lot.”

Another time, Langnas heard “about a woman who wanted to make her daughter a birthday cake; she went into a local corner store. All of the cake mixes on the shelves were out of date – every single box. She had nowhere to go because she didn’t drive.

“Those are the stories that just break your heart,” he notes. “Unfortunately, some folks here in Chester really don’t have a choice, and that’s what we wanted to do, was give them choice, and also empower them through our Carrot Cash benefit membership program, [which enables] them to … get help if they needed it.”

“We got a lot of input from members of the community,” affirms Philabundance President and Executive Director Bill Clark. “It was very important to the members of the community that they saw this as their store and that we work with industry professionals” to create an optimal shopping experience, such as architect Jerry Roller.

Since the store has opened, community reaction has been “fabulous,” asserts Messina. “I mean, we had a mad rush on opening day. It’s been very consistent since. We’re getting a lot of positive feedback, mostly about the fresh produce, about our fresh meat, about our deli department …. We’ve heard a lot of feedback about people that are so excited about having a supermarket in their city again, ecstatic, and almost every one of them refers to it as ‘their’ supermarket, which is awesome. That’s pretty much how we feel: This isn’t really our store, it’s theirs, and we’re happy to be that way. They’re very, very excited about us being here.”

Membership Manager Denina Hood likewise describes community reaction since the opening as “overwhelmingly positive. … We have a gentleman -- he doesn’t live that far from here -- he’s here every morning at 8 o’clock. Every morning – you could set your clock by him.” Even if it’s just to buy one thing, “he is here, and he opens up the store – he probably knows the store better than anyone” who works there, she quips.

All of the local enthusiasm for Fare & Square is reflected in the rate of enrollment in the store’s Carrot Club. “As far as we can estimate now, about 40 percent of the community has signed up to be members, so that’s a substantial impact to a community like Chester, whereas … the food cupboards probably only get to 2 percent or 3 percent of the people,” says Clark.

What’s more, in the short time since opening day, the store has already become a community gathering point, “almost like a high-school reunion thing going on,” as Hood characterizes it, with people running into each other after not having seen each other for years, despite not living that far apart.

“Chester was the first city in Pennsylvania, it has a long and proud history, and to have a city of this size without one supermarket defines a community in a negative way,” observes Clark. “Having a supermarket now defines the community in an entirely different way, and I think that what we sensed was a lot of that community recognition that they as a city could be proud now.”

And that pride could conceivably radiate beyond Chester’s city limits as shoppers come in from other nearby communities to shop at Fare & Square.

“We don’t know yet how to calibrate that, but we do believe that the trading area for this store would be larger than a typical commercial store, and we know from our membership registrations that we already have members that are from Delaware, from Philadelphia and the surrounding areas,” says Clark. “The membership at least has been registered from a larger trading-area radius. It could very well be that we end up having a draw, which we’re referring to internally as more of an ‘Ikea effect’; it’s kind of a regional market [more] than a neighborhood” store.

Certainly, community uplift will be an important way of gauging the viability of the store, as well as of the concept. “We don’t value success on its profitability, its return on investment, the amount of shrink — I mean, all the typical operating things that drive towards the bottom line, we’re not interested in,” explains Clark. “We’re interested in, does it serve the purpose of being a binding agent for the community to build civic pride, and does it provide access to the healthy products that, over a longer term, can actually move the needle toward a healthier diet?”