The grocery war is on: HEB is making its move into D-FW – The Dallas Morning News

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H-E-B is finally bringing its namesake supermarkets to Dallas-Fort Worth.

The San Antonio-based grocer, which has been buying land in North Texas for more than 20 years, always said it was a matter of when, not if, it would expand here.

H-E-B said it will break ground on two stores this summer in Frisco and Plano. They will open in fall 2022.

“We’re excited to say that the time has come for us to bring our flagship H-E-B banner to Dallas-Fort Worth,” said Stephen Butt, president of H-E-B’s Central Market division based in Dallas.

  • The Frisco H-E-B store will be built on the northeast corner of Legacy Drive and Main Street on land the company bought in 2016. The site is a mile east of a Kroger on Main.
  • The Plano store will be on land H-E-B has owned since 2012 at the southwest corner of Preston Road and Spring Creek Parkway. That location is about 5 miles from the company’s Central Market store in Plano.

The two stores will be about 9 miles apart, straddling the Dallas North Tollway and surrounded by rooftops in Collin County, one of the fastest-growing areas in the nation.

Butt declined to say how many stores it plans to open here beyond the first two.

H-E-B’s entry will unleash a new level of competition in D-FW. The company ranks high both with customers and in industry performance. Walmart has the largest market share here, and all the major national grocery chains have significant footprints in D-FW, from Kroger and Albertsons to Aldi, Trader Joe’s, Sprouts Farmers Market, Target, Sam’s Club, Costco, Amazon and Whole Foods Market.

“This latest push into D-FW signals that H-E-B’s intent is to emerge from the pandemic as a long-term winner,” said Pam Goodfellow, director of retail insights at Kantar. Grocery at large did well during the pandemic, she said, but in the next couple of years ,“we are going to see the truly strong competitors separate from the weak as they jockey for lasting food-at-home dollars.”

Unlike its competitors, H-E-B is run by Texans for Texans and has gained loyalty over the years as an employer, corporate citizen and for the flavors it serves up in prepared and frozen foods. It regularly adds new private-label products, including varieties of salsas and queso. Its Texas-shaped tortilla chips are shipped to Texans scattered all over the country.

In 2020, H-E-B moved ahead of Trader Joe’s to become the top U.S. grocer in the annual Retail Preference Index from data science firm dunnhumby. It was No. 2 this year as Amazon jumped to the top of the ranking during the pandemic.

Butt said that eventually all the retailer’s banners will open stores in D-FW.

In addition to H-E-B and Central Market, the company owns the Mi Tienda chain and Joe V’s Smart Shop, a low-cost concept. Its Austin-based Favor delivery service also operates here.

Mi Tienda is H-E-B's Hispanic concept store.
Mi Tienda is H-E-B’s Hispanic concept store.(H-E-B)
Joe V's Smart Shop is H-E-B's discount grocery banner.
Joe V’s Smart Shop is H-E-B’s discount grocery banner.(H-E-B)

“North Texas is a very important market for our future growth, for all of H-E-B,” Butt said. “Our plan is to grow here with our multiple formats.”

The company brought its Central Market stores here first.

Central Market, a division that’s based in Dallas, opened its first local store in Fort Worth in 2001 and now has six locations, including stores in Dallas, Plano and Southlake. The other Texas markets with Central Market stores only have one or two of the upscale specialty chain.

Butt said expanding the H-E-B brand here won’t affect its plans for Central Market. The company is reopening the tornado-damaged Preston Hollow Central Market on June 30 and said its plans for stores in Uptown Dallas and in Oak Cliff will continue to move forward.

“We’ve learned over time that customers use both formats. They love the completeness of a trip to our food/drug H-E-B stores and fill in with specialty items at Central Market,” Butt said. “We find customers use both.”

Central Market in Dallas at Preston Road and Royal Lane will reopen on June 30. It's being rebuilt after a tornado damaged the store in 2019.
Central Market in Dallas at Preston Road and Royal Lane will reopen on June 30. It’s being rebuilt after a tornado damaged the store in 2019. (Lola Gomez)

H-E-B was already positioned to respond to the changing consumer habits and increased demand during the pandemic and pulled it off better than the competition, said Scott Benedict, director of the Texas A&M Center for Retailing Studies.

“H-E-B is really good at stores and really good online,” Benedict said. “The innovations of the past year, everything they’ve learned and refined, makes them particularly ready to come into D-FW.”

Bennett spent much of his career at Walmart and said there were only two companies he heard management compliment glowingly — H-E-B and Florida-based supermarket chain Publix.

Grocery chains that are struggling a bit now are going to be challenged by the bright new stores H-E-B will build, he said.

D-FW is the largest market in Texas that doesn’t have H-E-B stores dotting its neighborhoods.

The 116-year-old Texas grocery has opened stores south and west of Fort Worth in Burleson, Cleburne and Granbury. Its newest store in the area opened in 2019 just west of Fort Worth in Hudson Oaks.

A store in Waxahachie is 28 miles south of downtown Dallas — close enough for some devoted shoppers to make the trek.

The retailer believes it can make inroads not only with people who already know H-E-B but also with new transplants to Texas who have gravitated to the suburbs.

“We hear people ask all the time when are we bringing H-E-B to the market. That recognition makes us proud, but there are many in D-FW who don’t know us,” Butt said. “There are a lot of new residents in Plano and Frisco. And we will work hard to earn their respect and their business.”

While the brand is known in the supermarket industry as a big Texas regional supermarket chain, it’s not in all parts of the state yet. H-E-B, which operates 420 stores mostly in Central, South and West Texas and Mexico, doesn’t operate in El Paso or the Panhandle. D-FW holds the largest market potential.

Its entry into the Houston market was brutal for the rest of the grocery operators. H-E-B started opening stores in Houston in the early 2000s and within 10 to 12 years its market share was neck-and-neck with Kroger and Walmart. By 2016, it catapulted over both operators and has been No. 1 in Houston ever since.

A broad announcement to H-E-B’s employees went out Friday morning. “A strong team” has been assembled to work on the expansion, Butt said.

Juan-Carlos Rück, H-E-B executive vice president, said part of the retailer’s success over the years has been not only from customers’ trust, but also from employees “who go above and beyond to serve them.”

Kathryn Rohloff, 28, of Dallas grew up in Houston and stocks up whenever she can on her favorite H-E-B products — sea salt tortilla chips, non-flavored bubbly water and in-house baked breads.

”One of my biggest gripes with moving to Dallas was the lack of H‑E‑B. Whenever I see family I make them bring my favorite H‑E‑B staples,” she said. Rohloff moved to Dallas in 2015 and says that when she lived overseas for a time, her parents would send her H-E-B care packages.

”I love H‑E‑B. I cannot wait for them to come to Dallas,” she said. “I also had friends who worked for H‑E‑B and have always been treated so well.”

Twitter: @MariaHalkias

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