Master of Invention

Celebrating its 100th anniversary, the Piggly Wiggly franchise is still showing the industry how to go to market.
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People love “the Pig.”

That is how Southerners refer to Piggly Wiggly, the store that not only has the most indelible, cute and funny name in the supermarket industry—but also invented it. 

Businessman Clarence Saunders opened the first Piggly Wiggly on Sept. 19, 1916 at 79 Jefferson Avenue in Memphis, Tenn. Featuring a whopping 750 items, it was a sight to behold, as Piggly Wiggly was the first food store that allowed shoppers to actually “shop” and gather their own goods, rather than walk up to a counter and hand a clerk a list of items as had been the traditional practice. According to company lore, Piggly Wiggly was also the first to price mark every item, have a turnstile, use shopping baskets, have checkstands and require employees to wear uniforms. 

No one knows how the Piggly Wiggly name came about. One theory has Saunders peering out of a window on a train and seeing a piglet wiggle under a fence and not being able to get the image out of his mind. Once when asked about the unusual name Saunders replied, “I named it that so people like you would ask me just that question.”

Yet while still eliciting sneers from many Northerners, Piggly Wiggly has managed to not only survive but also thrive, outliving other industry pioneers—Food Fair, Grand Union, First National and A&P among them—that have been relegated to the graveyard of retail history.

Much of its success is attributable to the fact that Piggly Wiggly stores are independent franchisees deeply rooted in their communities, say industry observers.

“We have the most recognizable name in the Southeast U.S., and an independent grocer is able to utilize the brand and standards to their benefit while servicing their local community,” says Kristen Thane Clark, manager of communications at C&S Wholesale Grocers, the Keene, N.H.-based wholesaler that owns the Piggly Wiggly name. “We have our own mascot, Mr. Pig, who proudly participates in various community events, parades and store promotions,” she adds.

Suited to their community, Piggly Wiggly stores run the gamut from barebones discount outlets, to traditional supermarkets, to upscale gourmet emporiums, and operate everywhere from small bayou outposts and rural towns, to thriving suburbs and major cities including Birmingham, Ala., New Orleans and Atlanta.   

“Many years of experience, strong customer service and independent ownership allows them the flexibility to make various changes in operations to market to a specific customer need,” Clark says. “We offer the private label products to Piggly Wiggly stores, reflecting our name with top quality products in all categories. The monitoring of store standards by Piggly Wiggly regional managers ensures our facilities and overall operations measure up to or exceed competitors’ offerings for long term viability.”

“It is hard to out-local a Piggly Wiggly,” says Richard J. George, Ph.D., professor emeritus, food marketing, Haub School of Business at Saint Joseph’s University in Philadelphia. “They are the community store and do a lot of good stuff for the community, like getting involved with local schools, youth leagues, Little Leagues, etc. Ask other retailers what their community involvement is and they will tell you they belong to the local country club. But Piggly Wiggly is a store that likes to get involved. In many small towns Piggly Wiggly is the grocery store,” George says. “In their heyday they had almost 2,700 stores.”

Those early stores, however, were a fraction of the size of what would now be considered a modern supermarket. 

Today, 538 Piggly Wigglys are spread across 17 states, primarily in the South, but as far west as Oklahoma and north to Wisconsin, Illinois and Ohio. “In the past three years, we have expanded our exposure in West Virginia and Ohio,” says Clark. “We anticipate our future growth to occur in states adjacent to the ones in which we presently operate.”

Four wholesalers distribute Piggly Wiggly branded product: C&S Wholesale Services in Mauldin, S.C.; Spartan-Nash in Lumberton, N.C.; MDI in Hickory, N.C.; and the largest, Piggly Wiggly Alabama Distributing Co. in Bessemer, Ala., with $750 million in annual volume, servicing 275 stores, more than 200 of them under the Piggly Wiggly banner. In addition, Associated Wholesale Grocers divisions in Tennessee and Louisiana; SuperValu in Indianola, Miss.; and C&S-owned Grocers Supply in Houston, supply Piggly Wiggly stores with non-private label.

“People love the Pig,” says David Bullard, president and CEO of Piggly Wiggly Alabama Distributing Co. “A lot of times when you go into a Piggly Wiggly store it is kind of a throwback to an earlier time, and oftentimes shopping there is a social event.”

By “throwback” Bullard is not referring to stodgy, linoleum-tiled floor stores with manual NCR registers that still dole out S&H Green Stamps, but rather to the level of customer service. Piggly Wiggly is the type of store where the cashier will know the entire family by name and take the time to chat about how the kids are doing.

“A lot of times the meat cutter at the Piggly Wiggly is the best-known guy in the community,” Bullard says. “We are known for our meat. We are the 10th largest Certified Angus Beef distributor in the country, and the individual cuts that you can get at a Piggly Wiggly you are not going to get at a lot of the chains, particularly Walmart.”

“It is hard to out-service a Piggly Wiggly,” George says. “Piggly Wiggly has relationships with their customers. They create theater and interact with people, and that is what being a small-town retailer is all about. They have a better chance to develop customer intimacy with the customer than the Walmarts, Krogers and Safeways of the world.”

Piggly Wiggly also has strong relationships with its suppliers. Case in point, Kysor/Warren, the Columbus, Ga.-based refrigeration manufacturer, used a new Piggly Wiggly in its hometown operated by JTM Corp., an operator of 19 Piggly Wiggly stores, to install its new ammonia-CO2 cascade alternative refrigeration system. Since the store opened in September 2015, it won a Green Chill Best of the Best Award and cut its energy by 16 percent compared to a similar new store.

“We approached JTM because they are local to Columbus and we’ve worked with them on a number of their stores in the past,” says Michael Lehtinen, director of marketing at Kysor/Warren. “We wanted to have someone close to our plant since this system was the first of its kind, and we wanted to keep proximity to where we have our technical base and manufacturing facilities.” 

Another advantage was Piggly Wiggly’s embracement of new technology, Lehtinen says.

“Piggly Wiggly is an innovator in the grocery industry,” he says. “It is good to be part of a program like this with an innovator in the industry. They may not have the widespread reputation of it, but they really are, and for us we were very fortunate.”  

​Crestline Pig

Each Piggly Wiggly store is unique and tailored to its community, Bullard notes, citing the new Piggly Wiggly Crestline Village as an example. “I would consider Crestline to be the most affluent area in Alabama and we just put in a very high-end store. It is doing very well,” he says.

The Birmingham, Ala., neighborhood of million-dollar mansions on shady hilly streets had a Piggly Wiggly for more than 30 years, but it was shuttered in 2014 when the landlord did not renew the lease, pushing it out for a CVS/Pharmacy. 

Crestline residents did not take the loss lying down. Manicured lawns started sprouting “Save the Pig! Save our Village!” signs and a “Save the Pig” Facebook page earned thousands of likes. 

The store’s owners—Andy Virciglio and brothers Naseem and Basim Ajlouny—hired a realtor and purchased six individual lots in the heart of the village’s downtown to build a new Pig. One of the parcels included the Girl Scout Hut building, which the owners paid to renovate and move to a nearby lot. 

Opened in May, at more than 28,000 square-feet, the new store is about one and a half times larger than its predecessor. Its charming red brick exterior and asphalt shingled roof blends in well with the neighborhood. To create more selling floor, the stock room and offices were put on the second floor. In addition to Piggly Wiggly’s typical grocery products sold at competitive prices, Crestline boasts a service butcher, self-service Red Diamond coffee bar, and a wine and craft beer department that looks like a tasting room in a Napa Valley winery. 

Craft beers are sold on-tap by the growler, while high-end wines, some with price tags of more than $489, are merchandised lying down from behind a glass case with sliding doors.  

On the other end of the spectrum, about 10 percent of Piggly Wiggly Alabama’s store base operates on the Cost Plus format, where consumers pay the same price the store pays for the merchandise, plus 10 percent.

Piggly Wiggly Alabama is a true cooperative with no corporately owned stores, Bullard says, and as such members are free to supplement their stock with locally sourced grocery, produce and perishables, and even $489 bottles of wine.

“We try to buy as efficiently as we can,” Bullard says. “We provide other services including advertising, retail accounting, computer services. We have a team of about 35 field personnel that are out every day in our stores across the Southeast consulting in areas of grocery, meat, produce, HBA. We also have a sales force as we’re always trying to grow our business as well.”

Because Piggly Wiggly Alabama has a reputation of operating a lean business model with low overhead, its cost of goods are very low, with minimal delivery fees, Bullard says.

“One of the things that our operators like about buying from us is that it is simple,” Bullard says. “They know we are not a shell game. We don’t play games with high prices here and low prices there. We’re low-cost across the board.

“We’re very transparent in our operation. We are really good at going into a town or even a metropolitan area and helping that retailer compete in his given marketplace,” Bullard continues. “It is a big strength for us to go in and take a look around the area, see what the competition is and help the operator develop a program that will allow them to better compete.”     

That is accomplished through Piggly Wiggly Alabama’s lean business model. “Being a customer of ours is simple, and we’ve maintained a family-type environment throughout our company,” says Bullard. “I know a lot of folks around us are struggling, and I think we’ve got kind of a niche. We have a niche in that we are the only supplier of Piggly Wiggly products around, and the Piggly Wiggly private label is a very powerful brand, particularly in the South.”

When it comes to the operators, Piggly Wiggly is a family affair, with many stores under their second and even third generation of family ownership. 

Best Deal in America

To encourage traffic at its warehouse, Piggly Wiggly Alabama pays an annual patronage dividend to its members, based on the profits from the company. “Operators get a return on that profit based on their purchases from the warehouse,” says Bullard. “For example, if our patronage is 1.5 percent, they’ll get back from us 1.5 percent on all their purchases. Half of that is paid up front. The other half we take and put in a 10-year note that guarantees 7.5 percent interest—each year for 10 years. I call that 7.5 percent interest the best deal in America because I don’t know anybody else who is paying 7.5 percent interest.”      

That helps ensure survival in an industry notorious for low-margins and profits. 

Having happy owners helps Piggly Wiggly further cement its reputation as the supermarket that is “Down Home, Down the Street,” as the slogan plastered on the side of every Piggly Wiggly tractor trailer truck states. It is a practice that is definitely taking off. “There are riches in niches,” George says. “Piggly Wiggly can own this niche, be the player in the community and do quite well.”    

Best in Show

This little Piggly Wiggly went to the food show. 

Piggly Wiggly Alabama Distributing Co. puts on an FMI-style food show for its members in downtown Birmingham, Ala., allowing operators to come together to see and sample the latest products.

“We are a very food show oriented company,” says David Bullard, president and CEO of Piggly Wiggly Alabama Distributing Co., based in Bessemer, Ala. “We have three large food shows a year where we rent out the Birmingham-Jefferson Civic Center downtown. We’ll have about 250 vendors come in and negotiate deals with them.”

This past May’s show proved to be extra special as it doubled as a celebration for Piggly Wiggly’s 100th anniversary, which officially was Sept. 19. “We constructed our own replica of the original Piggly Wiggly,” Bullard says. “We had a big birthday party with a birthday cake.  Even Mr. Pig was there,” he says.  

“We worked with a lot of our private label suppliers and got them to include our 100th anniversary insignia on the labels,” Bullard says. 

The 10 Percent Factor

Competitors are finding it hard to catch a greased Pig—especially one operating on the Cost Plus concept. That is where items in the store are priced at cost, with shoppers charged a 10 percent markup on that at the register. 

“Cost Plus is a concept that has really taken hold in the South,” says David Bullard, president and CEO of Piggly Wiggly Alabama Distributing Co., based in Bessemer, Ala. Bullard says there are 35 Cost Plus, around 10 to 15 percent of his store base.

One of those is the Piggly Wiggly in McCalla, Ala., a Birmingham suburb not far from the Bessemer warehouse. Originally a Food World, a discount banner operated by the former Bruno’s and its now defunct successor Belle Foods, since switching to Cost Plus, the store has been more than holding its own against the Publix directly across the highway. Weekly sales have increased from around $170,000 a week to more than $300,000, Bullard estimates.

“Those sales have to be coming from somewhere,” he says.

Upon visiting the store it is easy to see why it is so popular. Unlike other discount supermarkets, Piggly Wiggly McCalla has all the trappings of a modern supermarket, including spotless floors, wide aisles, fully stocked shelves and an extensive self-service meat department. Signs throughout the store and each department proclaim the concept. 

A box of fresh Tastykakes, pre-priced at $3.99 is marked on the shelf for $2.24. Another 23-cents or so is tacked on at the register. “People have embraced this and it is a concept that has really helped a lot of independent retailers compete, particularly in very tough competitive areas,” Bullard says.

It’s Nice to Share

One way the Piggly Wiggly Alabama Distributing Co.cooperative is helping its independent retailer members better compete with the “big boys” chains is through its membership in the Retailer Owned Food Distributor Association (ROFDA), a networking group of 13 similar co-ops across the country, including Unified Grocers, URM, Associated Foods Salt Lake City, Affiliated Amarillo, AG Baton Rouge, AG Florida, Olean and  AG New England.  

“It is a really strong share group,” says David Bullard, president and CEO of Piggly Wiggly Alabama Distributing Co., based in Bessemer, Ala., “We get together and pursue aggregated purchasing and buying opportunities to give us the muscle to get even bigger and come together. It gives us a better cost of goods, and we pass that on to our retailers.”

ROFDA also helps when it comes to troubleshooting problems. 

“A week doesn’t pass by without me picking up the phone or shooting an email to one of the other CEOs and asking ‘Hey, how do you all do this?’ or ‘What kind of lease programs do you operate with your stores?’ Because a lot of times, the wheel has already been invented. ROFDA helps us stay abreast of it,” Bullard says.   

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