heinen's ceo divulges plans for new downtown grocery, acknowledges challenges

Although Heinen's is still mapping out the details of its planned grocery store in downtown Cleveland, co-owner Jeff Heinen recently shared with Fresh Water conceptual plans, while acknowledging that opening a 33,000-square-foot grocery downtown is anything but a slam dunk and will require fine tuning to reach the right market.

Last year, Heinen's announced plans to bring a long-sought-after, full-service grocery to downtown Cleveland. Later this year, that store will open at the historic Cleveland Trust rotunda at East 9th and Euclid, which first opened in 1908. The shopping experience promises to be unlike any other, with customers selecting produce beneath a glorious stained glass dome.

Heinen's is conducting plenty of research to ensure the store fits local market dynamics, Heinen explains. "We're taking a space that's not a traditional grocery store and creating a grocery store offering," he says. "We're spending time making sure that we're not bringing a suburban store to an urban location."

The downtown location will be about half the size of the typical Heinen's, which poses challenges. "There's a reason why grocery stores are diverse and carry 40,000 items. Our challenge is to find items that please the highest percentage of people."

Heinen also acknowledges that "based on traditional metrics, there are not enough downtown residents to open a grocery store." Yet he was convinced to plunge into the market to help settle the classic chicken-and-egg quandary ("Which comes first, residents or retail?") after witnessing soaring demand for downtown living.

"This is a unique location," he notes. "East 9th and Euclid used to be the center of downtown Cleveland. They don't make 'em like this anymore. If you add the residential living momentum happening downtown, this project makes sense."

He adds, "We're ahead of the curve, but hopefully not too far."

While Heinen's likely will lose money in its first few years -- every new store does -- the owner believes the concept will catch on and he'll be able to tap into the growing base of downtown residents and office workers living and working downtown.

"Even now, there's plenty of competition," he admits, citing Dave's, the West Side Market, Constantino's and others. "The vast majority of downtown residents have cars, so it's not like you have a captive audience. We'll have to earn our business."

Heinen's will do that by offering a customized product mix catered to urban residents, including the kind of organic, local and fresh produce it's known for.
 
The company also will try and make shopping downtown as convenient as possible, while acknowledging that shoppers will not enjoy suburban-style parking. A parking garage that will serve Heinen's and The 9 is located about a block away, though the store will have curbside pickup along Euclid for shoppers to have their groceries loaded. There will be valet parking as well. Heinen's also will sell and promote the old-school two-wheeled carts common at the West Side Market and urban grocery stores in other cities.

"The average suburban person wants to drive up close," Heinen says. "But we also know that people in urban environments get the fact that the parking won't be next door."

To be successful, however, the store must pull from surrounding neighborhoods and not just rely on downtown apartment dwellers, who now number close to 14,000. "If people won't drive here, we'll lose a lot of money," he says.

Of course, shoppers also can utilize public transportation, such as the RTA's free and popular downtown trolley service. Heinen plans to request a stop outside his front door.

For those who want to learn more about how the store will be configured and what it will offer, details will be released in a few months. "It will be very similar to shopping in our Hudson store," he says of that efficiently designed concept. "We'll make downtown as much of a full line store as we can make it. The reality is, it's half the size of most of our stores, so there will be trade-offs. We may not have a 24-pack of Charmin, because downtown dwellers don't want a 24-pack."

"We think people will be able to do a full week's shopping here," he adds. "We know who grows most of our product, and we know how it was grown. The woman with six kids and the single person -- we want to serve everyone."


Source: Jeff Heinen
Writer: Lee Chilcote