Cal Poly – Sustainability in Retail May 10, 2016

Cal Poly – Sustainability in Retail
May 10, 2016
Leading, High-Growth Extreme Value Retailer
 Leading extreme value retailer of food, beverages and general merchandise
 Network of 249 store locations; added 29 stores in past 12 months
Business
Overview
 Offer 40-70% savings versus conventional grocers
 Typical store carries an average of 4,500 SKUs across grocery, deli, frozen,
produce, fresh meat, general merchandise, health & beauty care, and beer & wine
 Small format with average of 14,000 selling sq. ft.
48
Pennsylvania
40
6
20
Geographic
Presence
5
130
The Evolution of Grocery Outlet
1946
 Jim Read starts
“Cannery Sales”
in San Francisco
1940
1950
1959
 Jim Read
acquires interest
in “Big Bonus
Foods”, a 10
store Bay Area
chain
1984
 Deli department
added
1960
1970
1971 / 1972
 First supplier
agreement with
Del Monte signed
 First Independent
Operator
Agreement
signed
1995
 100th store
opened
1980
1990
1999
 Fresh produce
department
added
2006
 MacGregor Read
and Eric Lindberg
appointed as coCEOs
2000
2006
2002
 Corporate name
changed to
“Grocery Outlet
Inc”
2009
 Berkshire
Partners
acquires Grocery
Outlet
2009
2011
2006
 Fresh Meat
department
added
2011
 Grocery Outlet
acquires Amelia’s
in Pennsylvania
2012
2013
2014
 Hellman &
Friedman
acquires Grocery
Outlet
2014
2013
 Opened 20 new
stores
Period of Significant Growth Investments
2015
2015
 Entered LA
market
Grocery Outlet Enters the LA Market (Dec. 2015)
Cal Poly Students’ Experience at Grocery Outlet SLO
 “Why don’t you have everything that I’d find at a
typical grocery store?”
 “Why are your prices so much cheaper than a
typical grocery store?”
Our business model is different and
founded on sustainability
Our Differentiated Model Is Founded on Sustainability
Opportunistic Sourcing
 CPG excess inventory: close-dated products,
production overruns, packaging changes,
discontinued products, seasonal closeouts, and
new product innovation
 This opportunistic sourcing allows Grocery Outlet
to pass along significant savings to customers
 Our approach circulates products that would not
have otherwise been sold
Independent Operator
 Perform duties as CEOs of store operating
business in support of local community
 Select, order and merchandise products
according to local market preferences to
minimize waste
 To reduce waste further, all edible unsold food
is donated to local food banks
 Grocery Outlet’s shrink is approximately half
the industry average
Sustainability Measures at Grocery Outlet: LED Lighting
 Only Walmart has more LED-lit stores in the U.S.
than GO; first GO LED-lit store was in 2009
 100% LED lighting that far exceeds California state
requirements for energy efficiency, using up to 70%
less of the power of an equivalent fluorescent
lighting system
 Our lighting systems automatically “harvest”
daylight, reducing energy used for lighting
 LED lighting system eliminates 70-100 tons of CO2
emissions annually in each store
Sustainability Measures at Grocery Outlet: Refrigeration
 Our refrigeration system is air cooled, saving over
50,000 gallons of water annually per store over an
equivalent water cooled system
 We reclaim waste heat from refrigeration equipment
to heat store
 Our refrigerated equipment meets or exceeds all
Department of Energy requirements
 Our refrigeration, lighting, and HVAC systems are
monitored and controlled by a central computer to
maintain optimal energy efficiency
 Grocery Outlet uses very low HCFC refrigerants in
our refrigeration systems and automatically
monitors for leaks to reduce potential global
warming impact
Additional Sustainability Measures:
 Title 24 inspector said we are the “most dialed in”
retailer he has seen
 All retired signs and office paper products are
shredded and recycled
 Small store footprint reduces carbon footprint