Check Out Woodman's Buffalo Grove Behemoth

Woodman's Markets appears to be upping its expansion game in Illinois, with a recently opened Buffalo Grove store and new locations in the works in Lakemoor and Bloomingdale's Stratford Square Mall.

The Janesville, Wis.-based retailer's new Buffalo Grove store is a several times larger than a conventional grocery store, standing at 240,000 square feet. It is poised to draw a considerable crowd of shoppers looking for high variety and low prices. 

Indeed, Clint Woodman, president of the 24-hour superstore chain, told the Daily Herald that he anticipates the new store will draw customers from as far as an hour away like its Carpentersville and North Aurora, Ill., locations have.

Woodman added that the retailer’s strategy when scouting new locations includes ensuring they are close to major intersections with access to a highway. The Buffalo Grove store sits right at the intersection of North Milwaukee Avenue and Deerfield Parkway, both major roads that have been in the process of undergoing improvement. 

Additionally, according to the Daily Herald, the village incentivized the store to move into the area with a package that will share up to $7 million in sales tax revenue with the retailer.

The Buffalo Grove store will stray from Woodman’s typical strategy of not accepting credit cards, allowing customers to use a Discover Card, according to the Daily Herald. Woodman said this tradition has been in place because “accepting credit cards would be very costly” and the retailer would have to raise its prices.

David Livingston, supermarket site analyst with DJL Research, told WGB that since Woodman's carefully plots out each location, and has the money to buy property as opposed to renting, it "hasn't had a loser yet,” adding that he has seen Woodman's "drive a Walmart right out of business across the street."

The retailer, which has acquired fewer than 20 stores in about a century, opened its first store outside of Wisconsin in Rockford, Ill., in 2001 and moved on to a second location in Carpentersville, Ill., in 2004, expanding to a third location in North Aurora, Ill., in 2006.

Additionally, Livingston said Woodman's has "no debt so there is no interest expense" and their backroom storage space is a much higher ratio than their competitors so " they can have truckloads of products delivered directly to their stores” and the employee-owned retailer is not unionized, which also drives down cost.

"They also put customers, employees and just having fun messing with the competition before profits," Livingston affirmed.

Jim Hertel, SVP of Willard Bishop, a Long Grove, Ill.-based grocery retail consultant, told the Daily Herald that it is “an operation that is designed to move a lot of product and to do it at extremely aggressive price points.”

“You give up some things as a shopper there—it's not a high-frills environment—but if what you're looking for is an opportunity to save fairly significantly on your grocery bill, it's definitely an operation you should try,” he said.

Livingston urged that retailers can learn a thing or two from Woodman’s, advising that “the mistake other grocers make is putting the next quarter's earnings as top priority.”

“They borrow money to expand,” he said. “They rent rather than own. They have unions organizing their labor, creating high labor and benefit costs and less labor production. Other grocers take credit cards, adding 1%-2% to the expenses.”