by Lorrie Griffith/editor–Southeast
Jan. 6, 2019, will mark the first Sunday that Tennessee food stores will be able to sell wine.
Rob Ikard, president and CEO of the Tennessee Grocers & Convenience Store Association (TGCSA), said his members are looking forward to the change.
“Sunday is a huge shopping day for our members, and it didn’t make sense to have every category except one on sale on that day,” he said. “Fortunately, a slim majority of the Tennessee lawmakers agreed with us. This was a really hard-fought victory but a really sweet one because our members really desired the ability to serve their customers 100 percent seven days a week.”
The bill included a provision for liquor stores to get a headstart on Sunday sales, so they have been selling wine on Sundays since the end of April.
Tennessee food stores also have gained the ability to sell wine on more holidays—the Fourth of July, Labor Day and New Year’s Day. This year was the first one that Tennessee food stores were able to sell wine on July 4, Ikard said during a July 2 interview.
“We’re excited about it,” he said.
Under the new legislation, the only days wine sales will not be allowed in Tennessee are Christmas, Thanksgiving and Easter.
When grocery stores can sell wine is tied to when liquor stores are open, Ikard explained.
Before Tennessee food stores gained the ability to sell wine—July 1, 2016—liquor stores were closed on all of the holidays listed above, plus Sundays.
“Those were just guaranteed days off for them; they could take a holiday without having to compete. That’s why Sundays were prohibited as well,” he said.
Another alcohol-related bill that passed during this session was one that allows third-party delivery companies to transport alcohol. Now, companies like Instacart and Drizly can deliver alcoholic beverages to consumers.
“It’s a modification to a delivery law that was out there that was written in a way that didn’t allow for the third-party type companies to do it,” according to Ikard.
Bag ban proposed in Nashville
A day after the Tennessee General Assembly adjourned, legislation to ban plastic bags was proposed by two Metro Nashville councilmembers, Davette Blalock and Mike Freeman, according to News Channel 5.
Ikard says the timing was not coincidental; it would appear that the council members wanted to make sure the state legislature did not pass legislation to pre-empt bag bans before they were able to file it.
“We have been working at the local level in Nashville to prevent that bill from moving forward,” Ikard said. “At the same time, Memphis has toyed with the idea of a fee or a tax on plastic bags, so this is clearly an emerging issue in Tennessee, and we are looking at all options to deal with it at the local and state levels. It will definitely be something we’ll be talking about in 2019.”
During the 2018 session, a sugary beverage tax bill came up that is now the subject of a study committee, Ikard said. The bill as presented would require retailers to keep up with how much sales tax they collect on the sale of sugary beverages and then divert that amount of money into a fund that would go to “a food desert relief fund of some sort,” he said.
TGCSA’s stance is that it would be an administrative burden for food retailers to have to account for what portion of sales came from these beverages.
The association also is keeping an eye out for legislation that would favor “farm-to-table food cooperatives that seek to skirt the food safety standards of the state,” he said. “We’re definitely of the belief that we should all be held to a very high food safety standard, that lives are at stake and we should not let anybody be exempt from those standards.”
Independent to fill former Kroger space in Memphis
There was community outcry in Memphis in early January when Kroger announced it was going to close down two stores in the heart of the city—the one in Southgate shopping center on South Third Street, and the one at 2269 Lamar, near Airways. The stores, according to the Commercial Appeal, citing a company news release, each had lost more than $2 million since 2014.
Many groups had lamented the fact that food deserts would be created due to the stores’ closures, which took place Feb. 3, according to the paper.
Ikard said that one of TGCSA’s “great members,” Rick James, owner of Castle Retail Group in Memphis, will fill the Southgate space with a new Cash Saver cost-plus store.
Ikard says James’ decision to open the store is “very exciting for that community because he really knows what he’s doing in those areas.”
WREG Memphis, in a June 20 story, quoted James as saying that the store will offer customers in that South Memphis area with “affordable and healthy food options.”
“Supermarkets are still the number one retail visit per week, so that’s good for everybody else that’s in the center,” James told the news outlet, adding, “We’re very, very familiar with what the customers look for and what they expect out of a grocery store. Everything from assortment and variety to freshness.”
Union Realty Co., an affiliate of developer Belz Enterprises, is going to spend $6.8 million to make improvements to the center, according to a June 15 article in the Commercial Appeal. In its application for a Community Builder tax incentive from the Economic Development Growth Engine (EDGE) board, the developer stated: “Without this grocery store, the neighborhood residents will have to travel a substantial distance to reach a similar size grocery store. Many of the residents do not own cars, and bus service is limited.”
The Cash Saver store is expected to open in August.
Other store plans
Publix, which, according to its website, operates 42 stores in Tennessee in Nashville, Knoxville and Chattanooga and the spaces in between, is planning to open new stores in the less-urban towns of Cookeville and Tullahoma, Ikard said.
The Daily News Journal reported in mid-June that Kroger had postponed plans to relocate its Middle Tennessee Boulevard store to Mercury Boulevard in Murfreesboro, choosing to focus on its existing stores and e-commerce, the paper cited Melissa Eads, corporate affairs manager for Kroger Nashville, as saying.
The Cincinnati-based chain had been planning to build a 94,000-s.f. store in a former Rose’s store space on Mercury Boulevard.
On the e-commerce side, Kroger applied for the Murfreesboro Planning Commission to review its plans for a ClickList setup at the Memorial Boulevard store, the paper said. The store at 2325 Memorial Boulevard aims to offer ClickList grocery online ordering and curbside pickup by the fall.
The ClickList service has grown in scope to the point that it is now available at a majority of Kroger’s stores, Eads told the paper.
In Chattanooga, the Signal Mountain Town Council is wrestling with whether to allow Food City to build a new store there. According to a May 15 story on The Chattanoogan.com, a large number of Signal Mountain residents showed up for the May town council meeting, most of them in opposition to a proposal by The Keith Corp. for the store to be built on property the developer owns at 617 Cauthen Way, the news outlet said. After the meeting, which lasted more than four hours, the council decided that more discussion was needed. The Food City would be built on three of the 8.5 acres of land that is owned by the Keith Corp., The Chattanoogan added. Residents’ concerns included increased storm water runoff, traffic noise and the removal of more than 1,000 trees; several also expressed the sentiment that they had moved to Signal Mountain for the hometown feel and not for increased shopping opportunities.
Another resident said that Pruitt’s Grocery Store is already considered to be the town center, according to The Chattanoogan story, and it also offers “very personalized services and supports local vendors.”
The few in support of the project said revenue is being lost as Signal Mountain residents leave the mountain to shop for groceries.
The Keith Corp., according to The Chattanoogan, said that The Shoppes at Signal Mountain “would be in keeping with what residents wanted when the plan was created.” The store would be among Food City’s smallest ones. The development as a whole would create nearly 130 jobs.
Food City currently operates a store at the foot of the mountain; a three-year lease remains.
UGO expands its Athens warehouse
United Grocery Outlet (UGO) was founded in 1974 when Michael Tullock was still in high school. He launched The Bargain Barn in the back of his parents’ antique shop in Etowah, Tennessee.
While Tullock’s parents Doug and Carol drove the family station wagon to the Stokely-Van Camp plant to purchase cases of canned goods, Michael was busy minding the store after school. Within a few weeks, Tullock’s grocery business had driven out the antiques. With $1,000 allotted by his parents, Michael’s business was off and running, according to the company’s website.
The Athens, Tennessee-based company today operates nearly 40 stores in Tennessee, North Carolina, Kentucky, Alabama, Virginia and Georgia under the names United Grocery Outlet, Grocery Outlet and Bargain Barn.
Last September, The Daily Post-Athenian reported that UGO was expanding its Athens distribution center and warehouse, with plans to add 40,000 s.f. of space to the Lee Highway facility, which housed the company’s headquarters and operations center in approximately 100,000 s.f. of space.
Michael Tullock told the paper that the expansion would be 30 feet high, with about 12,000 s.f. of much-needed additional refrigerated space.
The company also bought an adjacent 24,000-s.f. building in the Northridge Industrial Park to prepare for future growth.
“The expansion will fill up with current business as soon as it’s finished,” Tullock told the paper, “so the building next door will give us a good opportunity for the future.”
The company’s 37th store opened in Ringgold, Georgia, just south of Chattanooga, last October.
United Grocery Outlet is described as the largest closeout grocery company in the Southeast, with approximately 800 employees.