By Barbara Soderlin / World-Herald staff writer
Customers began lining up at 2 a.m. Wednesday to be among the first inside Omaha’s newest competitor in the ever-hotter grocery game.
Fast-growing Illinois chain Fresh Thyme opened its 40th store, the first in Omaha, Wednesday at 150th Street and West Maple Road.
Two other west Omaha stores are set: Locations will open shortly after the new year — maybe as soon as January — at 132nd Street and West Center Road, and near 175th Street and West Center Road in the Lakeside area, a store official told The World-Herald on Tuesday.
A fourth location is set for the Crossroads Mall redevelopment, but timing depends on that project moving forward.
Shoppers this week flooded the store’s Facebook page with comments. One shopper is “so glad for another health food store.” Another added, “You have no idea how excited we are!”
Ralston resident June Kowalewski, 35, is among those who say they can’t wait. A friend brings back a Fresh Thyme haul from a store in Lincoln that already has opened there, she said. A mortgage training supervisor at a credit union, Kowalewski does all the grocery shopping for herself and her boyfriend. She considers herself a loyal Hy-Vee customer who also shops at Costco and Walmart but is eager to try Fresh Thyme.
“I try to eat as healthy as I possibly can, but I also have food allergies,” she said. “One of the things that really brought me to Fresh Thyme is they’ve got really, really good prices. I want to say, in a nice way, that it’s like the Walmart of Whole Foods.”
She’s on the hunt for healthy ingredients for meals, adding: “That’s what people are looking for these days.”
The store caters to customers like Kowalewski who are looking to eat a healthful diet without spending a lot. It targets middle-income to upper-income areas, but not the highest-income neighborhoods.
What does Fresh Thyme sell that other stores don’t? Not much.
Other stores in Omaha also boast low prices on produce, offer large produce sections including organics, make sausage in-house, carry a wide range of specialty and bulk foods, and stock natural beauty and household goods.
What distinguishes Fresh Thyme is the depth of variety in specialty foods, how merchandise is displayed, and what the store doesn’t carry.
Fresh Thyme rips the most popular pages from its competitors’ playbooks, then leaves out most national-brand processed food like Pepsi and Doritos, and flips its store footprint around so the produce section is right in the middle.
This strategy pays off — produce makes up nearly a third of Fresh Thyme’s sales volume, compared with about 10 percent at a typical supermarket. Its meat, prepared foods and “natural living” departments also see outsized sales.
That could heighten competition among other groceries as consumer shopping habits evolve. A new report made public this week at grocery industry group FMI’s annual conference played up the importance of produce in the grocery business. The group’s Power of Produce report concluded that produce is a top draw that can persuade shoppers to switch stores and that alternative-format stores like Fresh Thyme are luring younger customers, who may then fulfill the rest of their grocery list while they’re at it.
But industry consultant David Livingston cautioned that Fresh Thyme’s model is yet unproven. He lumps the chain in with others like Natural Grocers, which has Omaha locations, and the Fresh Market, which closed unprofitable stores this year after it was sold to a private-equity firm.
These stores typically have much lower sales per square foot than upscale competitors Trader Joe’s and Whole Foods, Livingston said. He estimates Fresh Thyme weekly sales at a typical store at $250,000, compared with $500,000 and up at the others.
“There’s going to be some shakeout,” he said. “They’re building a lot of stores really fast without ever testing out the concept to see if it works.”
Privately held Fresh Thyme does not disclose its sales. Its investors include Meijer, the privately held Michigan supermarket operator. The chain launched in 2014 under the leadership of former executives from Sunflower Farmers Market, a Phoenix chain that merged with Sprouts Farmers Markets.
It has plans to open 20 to 25 stores a year, for a total of 150 across the Midwest in the next four years, and may look to an initial public offering a few years down the road.
Livingston, a location expert, said Fresh Thyme is picking “B” rather than “A” locations for its many stores, based on traffic and demographics.
One of its new locations, for example, was home to an aging No Frills store.
Director of Operations Greg Hamm doesn’t dispute that but says Fresh Thyme stores are a success.
“We go into areas where we’re told somebody else was there and it didn’t work out,” he said. “Well, it works out for us. Customers are really excited about who we are as a company.”
He also said the chain is OK with lower margins and is willing to make a quick nickel over a slow dime, while moving large amounts of volume.
A growing private-label lineup will help keep prices low while boosting margins, he said.
The first Omaha store is in the new West Grayhawk retail development, along the fast-growing West Maple Road corridor, where signs advertise “For Lease,” “Available Space” and “Retail Coming Soon.”
Despite the strip mall vibe outside, the store takes on a trendy farmhouse feel inside. Check stand light fixtures are fashioned with galvanized metal and mason jars.
Workers on Tuesday readied the store for a flood of customers who appear eager to give it a chance. Workers tied up bouquets of balloons, stacked cartons of raspberries, arranged pears in a pyramid, and lined up cucumbers in neat rows.
Omaha should get ready, Hamm said.
“We’re a game changer. We’re going to change how everyone else in the area does business.”
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