Stew Leonard’s, renowned in grocery retailing,
is looking to repeat that success with its new wine and spirits stores.
By Richard Brandes
Anyone serious about retail knows the story of Stew Leonard’s, the Norwalk, CT-headquartered grocery emporium that is renowned for its sometimes extravagant, always innovative merchandising techniques that range from a petting zoo to in-store animatronics and costumed characters to scheduled entertainment. The three-store grocery chain — which began its business life as an on-site dairy — differs from many supermarkets in that it offers approximately 2,000 items for sale, whereas most groceries average about 30,000 items. That focus, the company says, allows it to offer consumers fresh, quality merchandise at a good value.
Wine managers Doug Zucker (left) and Jerry Martellaro
oversee operations at Stew Leonard’s newest wine and spirits store,
which opened a little more than a year ago in Farmingdale, Long Island, NY.
Now, the company is also targeting wine and spirits consumers with a series of stores located in its two Connecticut grocery locations (Norwalk and Danbury), Yonkers, NY (just north of New York City) and Farmingdale, Long Island, in the eastern suburbs of New York City, which is the newest of the Stew Leonard’s wine and spirits operations and has been opened for a little over a year. Already, the two New York locations have helped make Stew Leonard’s Wines one of the largest retailers of wine and spirits in New York, with sales approaching $25 million a year.
The challenge is to translate its successful approach to retailing from its groceries to its wine and spirits operations. “Stew’s major goal is to provide the best customer service possible,” said Jerry Martellaro, one of the two wine managers at Stew Leonard’s Wines in Farmingdale. “To do that he makes sure to cultivate a knowledgeable, passionate and friendly staff. He wants to offer customers new and innovative products at competitive prices. With that in mind, the staff tastes dozens of new wines every week, trying to find wines that provide the best quality and value to our customers.”
The overall company motto sounds like something you’d read on a refrigerator magnet: “Rule #1: The Customer Is Always Right. Rule #2: If the Customer Is Ever Wrong, Re-read Rule #1.” But it works like a charm. Indeed, customers like it to the tune of almost $300 million a year in sales; and the almost 2,000 employees, called “team members,” also like it, for family-owned Stew Leonard’s has developed a reputation as a great place to work. Indeed, Stew Leonard’s was ranked 30th last year in Fortune Magazine’s “100 Best Companies to Work For in America.”
But why does a successful, pretty famous grocer choose to open wine and spirits stores in one of the toughest markets in the country? Especially in an industry where individual state laws can be as serpentine as cooked spaghetti. [Because of these laws, it’s important to note that the Stew Leonard’s Wine stores are independent of the food stores. They are also independently owned by different members of the Leonard family, and doing business under different names. For example, Stew’s sister Beth Leonard Hollis owns the Yonkers store while Stew Leonard, Jr. owns the Farmingdale store. In addition, each store buys independently.]
The answer, according to Meghan Flynn, vice president, public relations for Stew Leonard’s, is: “Stew Leonard, Jr. said that a few years ago he was eating dinner with his family. The filet mignon, asparagus, corn, Ciabatta bread, all came from his family’s store. The only item on the table he was not happy with was the wine. He had bought it at a wine shop down the street and had not had any help picking it out, so he ended up just grabbing a bottle off the shelf.” He quickly became immersed in the wine business. Stew personally took the WSET course [Wine and Spirits Education Trust, taught by Mary Ewing Mulligan in conjunction with the International Wine Center] and accompanied his wine buyers to major wine shows and to meetings with vintners. He now regularly attends shows and visits wineries throughout the world; in fact, Stew and Jerry Martellaro just returned from a California wine trip at the end of February.
The Farmingdale Stew Leonard’s Wines contains 11,500 square feet, though the other wine and spirits stores range from 4,000 to 12,500 square feet. (The Stew Leonard’s grocery stores, in comparison, range from 103,000 to 130,000 square feet; the original Stew Leonard’s, which began as a 17,000-square-foot retail dairy store in 1969, has gone through 30 additions to its space through the years.) One area of the Farmingdale store is devoted to distilled spirits, while the majority of the floor and shelf space merchandise wine, which accounts for almost 80% of the store’s total retail sales.
With 11,5000 square feet, the Farmingdale Stew Leonard’s features lots of wine rack and case displays. Wine sales account for about 80% of the revenue at this location.
The retail space is organized by category and country/region and runs the gamut from a fine wine room to wood shelves to large displays selling product straight from the cases. The temperature-controlled fine wine room includes several hundred bottles of hard-to-get, highly rated, limited production wines from around the world.
The store features most nationally advertised brands, which are displayed in a variety of ways, from cut-case displays to wooden boxes. “Overall, the store is very tastefully merchandised,” Martellaro said. “There are maps of wine regions and signage — mostly created in-house — relevant to all manner of wine-related customer education.”
The custom-made signs are created to “try to tell a story,” Martellaro said. “We try to personalize the message… for example, a sign might say something like, ‘We found this great wine when we were visiting France.'”