Farmer Jack
Encyclopedia
Supermarket
A supermarket, a form of grocery store, is a self-service store offering a wide variety of food and household merchandise, organized into departments...
chain based in Detroit, Michigan. At its peak, it operated more than 100 stores, primarily in southeastern Michigan. In its final years the chain operated as a subsidiary of the New Jersey-based A&P (The Great Atlantic and Pacific Tea Company
The Great Atlantic and Pacific Tea Company
The Great Atlantic & Pacific Tea Company, better known as A&P, is a supermarket and liquor store chain in the United States. Its supermarkets, which are under six different banners, are found in Connecticut, Delaware, Maryland, New Jersey, New York, and Pennsylvania. A&P's liquor stores, known as...
) Corporation. A&P shut down the Farmer Jack chain on July 7, 2007.
Farmer Jack stores were typically in suburban neighborhoods, usually anchoring strip malls. In addition to offering groceries, each store operated full-service produce, floral, delicatessen, bakery, pharmacy, meat, and seafood departments. Many stores also featured a bank.
History
Farmer Jack's beginnings were in 1924, when Jewish-Russian immigrant Tom Borman opened a neighborhood grocery store, Tom's Quality Meats, at 12th and Forest in Detroit. In 1927, his brother Abraham "Al" Borman opened a store on Kercheval on the city's east side. The brothers eventually formed a partnership, which ended in 1945, with Tom developing Lucky StoresLucky Stores
Lucky Stores is an American supermarket chain founded in Alameda County, California in 1935. Lucky is currently operated by SuperValu in Southern California and Nevada and by Save Mart in Northern California and Nevada.In 1998, Lucky's parent company, American Stores, was taken over by Albertsons,...
, and Al developing Food Fair markets. In 1955, the two operations merged into Food Fair, operating under the corporate entity Borman Food Stores Inc. Four years later, the renamed Borman's Inc., sold more than 400,000 shares of stock, with the brothers retaining control. Proceeds from the stock sale fueled a buying binge: Borman's bought State Super Markets of Ferndale; American Stores Inc., acquired nine Lipson-Gourwitz Co. markets in Detroit, planning an expansion to 46 stores.
In 1966, Borman announced the opening of three suburban shopping centers that would contain gas stations, car washes, garden supply stores, Yankee discount stores, and food stores, operating under the new moniker of Farmer Jack.
By 1972, Detroit became a major zone of grocery store competition, with six chains competing in the region, including Chatham
Chatham (grocer)
Chatham was a supermarket chain, now-defunct, headquartered in southeastern Michigan, USA.Founded by Royal Supermarkets in the mid-1950s, Chatham were often compared to Kroger in size and selection...
and Great Scott! In a speech, Paul Borman claimed A&P
The Great Atlantic & Pacific Tea Company
The Great Atlantic & Pacific Tea Company, better known as A&P, is a supermarket and liquor store chain in the United States. Its supermarkets, which are under six different banners, are found in Connecticut, Delaware, Maryland, New Jersey, New York, and Pennsylvania. A&P's liquor stores, known as...
's move to discount-type stores had nearly destroyed the supermarket industry.
In 1987, Borman's was flush with cash, taking advantage of Safeway
Safeway Inc.
Safeway Inc. , a Fortune 500 company, is North America's second largest supermarket chain after The Kroger Co., with, as of December 2010, 1,694 stores located throughout the western and central United States and western Canada. It also operates some stores in the Mid-Atlantic region of the Eastern...
's troubles as an opportunity to diversify their store base beyond Michigan when it bought that chain's 60-store Salt Lake City division. Those stores were throughout Utah
Utah
Utah is a state in the Western United States. It was the 45th state to join the Union, on January 4, 1896. Approximately 80% of Utah's 2,763,885 people live along the Wasatch Front, centering on Salt Lake City. This leaves vast expanses of the state nearly uninhabited, making the population the...
, southern Idaho
Idaho
Idaho is a state in the Rocky Mountain area of the United States. The state's largest city and capital is Boise. Residents are called "Idahoans". Idaho was admitted to the Union on July 3, 1890, as the 43rd state....
, and in adjacent towns in Nevada
Nevada
Nevada is a state in the western, mountain west, and southwestern regions of the United States. With an area of and a population of about 2.7 million, it is the 7th-largest and 35th-most populous state. Over two-thirds of Nevada's people live in the Las Vegas metropolitan area, which contains its...
and Wyoming
Wyoming
Wyoming is a state in the mountain region of the Western United States. The western two thirds of the state is covered mostly with the mountain ranges and rangelands in the foothills of the Eastern Rocky Mountains, while the eastern third of the state is high elevation prairie known as the High...
. The Safeway stores were renamed Farmer Jack; the company planned to remodel and update them, as Safeway had not invested much in the division. Later in 1987, a lengthy strike by Detroit-area clerks and cashiers, who were not supported by meat cutters or Teamsters
Teamsters
The International Brotherhood of Teamsters is a labor union in the United States and Canada. Formed in 1903 by the merger of several local and regional locals of teamsters, the union now represents a diverse membership of blue-collar and professional workers in both the public and private sectors....
, depleted Borman's cash reserve. Borman's eventually bought out 800 workers, paying $12.9 million. The Western stores did not perform to expectations; within a year they were sold to other operators.
The 1987 strike started a period of losses that would eventually prompt the sale to A&P. During a decade of merger mania
Merger mania
The term "merger mania" is used, as in financial and law journals, to describe a period of high activity in corporate mergers and acquisitions ,with some merged companies then merging yet again into other companies within a few years...
in the supermarket business, A&P paid $76 million for 79 Farmer Jack stores operated by Borman's. The buyout made A&P the top player among grocery stores in southeastern Michigan, with a 36% share. By 1994, nearly all A&P stores in metro Detroit
Metro Detroit
The Detroit metropolitan area, often referred to as Metro Detroit, is the metropolitan area located in Southeast Michigan centered on the city of Detroit which shares an international border with Windsor, Ontario. The Detroit metropolitan area is the second largest U.S. metropolitan area...
had been converted to Farmer Jack stores.
Restructuring
After initial merger pains, Farmer Jack rose to prosperity, becoming A&P's most profitable division. However, by the early 2000s, Farmer Jack struggled to compete with newer, larger stores; less-senior, lower-cost labor; and more tech-savvy, efficient operations offered by rivals MeijerMeijer
Meijer, Inc. is a regional American hypermarket chain based in Grand Rapids, Michigan. Founded in 1934 as a supermarket chain, Meijer is credited with pioneering the modern supercenter concept in 1962. About half of the company's 196 stores are located in Michigan, with additional locations in...
and Kroger
Kroger
The Kroger Co. is an American supermarket chain founded by Bernard Kroger in 1883 in Cincinnati, Ohio. It reported US$ 76.7 billion in sales during fiscal year 2009. It is the country's largest grocery store chain and its second-largest grocery retailer by volume and second-place general retailer...
. Rather than investing significant capital into upgrading existing stores, A&P focused on expanding the chain beyond Southeast Michigan, entering Toledo, Flint, Saginaw, and Lansing markets. Meijer was engaged in an aggressive price-cutting campaign to fend off K-Mart's aggressive Super Center expansion, as well as Wal-Mart
Wal-Mart
Wal-Mart Stores, Inc. , branded as Walmart since 2008 and Wal-Mart before then, is an American public multinational corporation that runs chains of large discount department stores and warehouse stores. The company is the world's 18th largest public corporation, according to the Forbes Global 2000...
's proposed entry of Supercenter stores. Farmer Jack found it necessary to reduce prices to compete.
Farmer Jack's Detroit-area stores were experiencing significant drops in revenue due to the price cuts, as well as consumer flight. Rather than adding revenue, the chain's expansion proved to be a failure and major financial drain. Farmer Jack was now losing a significant amount of money. Then, an accounting scandal hit the chain.
In 2002, the chain reorganized, closed stores, and cut staffing. Farmer Jack attempted to improve its image by advertising clean stores and guaranteed fresh food. They converted a number of their older stores to A&P's Food Basics
Food Basics USA
Food Basics is a no-frills supermarket chain operated by The Great Atlantic & Pacific Tea Company in the northeastern United States. The Food Basics concept began in Canada, where it was launched by A&P's Canadian subsidiary. The two chains are no longer connected, as the Canadian Food Basics is...
format in an attempt to compete with extremely low priced chains such as Save-A-Lot
Save-A-Lot
Save-a-Lot is a discount supermarket chain headquartered in Earth City, Missouri, near St. Louis, United States. The subsidiary of Supervalu comprises approximately 1,250 stores in the United States with over $4 billion in annual sales....
. Unfortunately, the efforts proved too little and by 2005, the chain was officially up for sale. An agreement was reached to sell most of the chain to Spartan Stores
Spartan Stores
Spartan Stores Inc. is an American food distributor and grocery store chain headquartered in Byron Township, Michigan. The company distributes national and Spartan brand products to over 400 independent grocery stores in Michigan, Indiana and Ohio.-History:...
. However, Spartan backed out of the deal and, combined with a wage concession from its unionized workers, a decision was made not to sell Farmer Jack.
By late 2006, A&P was reporting that Farmer Jack was breaking even and sometimes recording a small profit.
Liquidation
In April 2007, A&P announced its decision to focus on its core Northeast Division; Farmer Jack was one of the chains put up for sale. In June, A&P announced that Farmer Jack would cease to exist as of July 7, 2007; the last remaining stores were shut down on that date.
Kroger
The Kroger Co. is an American supermarket chain founded by Bernard Kroger in 1883 in Cincinnati, Ohio. It reported US$ 76.7 billion in sales during fiscal year 2009. It is the country's largest grocery store chain and its second-largest grocery retailer by volume and second-place general retailer...
acquired twenty former locations while independent grocers collectively bought 21. In an October 2007 SEC filing A&P revealed that it received approximately $110 million for 41 former Farmer Jack sites, and that two warehouses and 25 stores remained on the market.
In June 2010 A&P stopped making lease payments at its vacant Farmer Jack locations; affected property owners responded with 24 lawsuits against A&P. In December 2010 A&P filed for bankruptcy; the filing cited dark leases from discontinued operations like Farmer Jack as a factor in its decision.
Marketing
Farmer Jack is remembered in metro Detroit for their "It's Always Savings Time" jingle, which was used in the 1990s and again in the mid-2000s. Its most famous advertising mode was the 10-second "Farmer Jack savings time" plugs where the radio personality would give a quick special while in the background would play a sound similar to a teletype that began and ended with a low "boinnng" sound.Another famous slogan was "Made in Michigan, Sold at Farmer Jack's". This was used to promote Michigan brands and agriculture products.
External links
- Farmer Jack (Archive)
- A&P