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2014, SPECIAL ISSUE

For the latest industry news visit www.cagrocers.com

CALIFORNIA GROCERS ASSOCIATION

www.cgastrategicconference.com

Traditional grocery? Meet non-traditional thinking. A place where one-size-fits-all is being replaced by one-size-fits-one. A place where true value is derived from expressing your true values.With today’s fragmented shopping reality, customers are looking for a different kind of retail relationship. Omni-connected consumers are embracing the companies and brands that express and demonstrate their values. How retailers define themselves is as important as the products on their shelves and the prices they charge. Truthfulness, integrity, sincerity, individuality, and openness are the new currencies that creates loyal customer connections — in-store and on-line.

Join your industry colleagues at this mind-expanding, purposeful journey into the next generation of grocery retailing.

CONFERENCE SCHEDULE OVERVIEWS U N D AY, S E P T E M B E R 2 1

Illuminators Golf Tournament Opening General Session Opening Reception sponsored by

Kraft Foods and E&J Gallo Winery After-hours Social Event sponsored

by Heineken

M O N D AY, S E P T E M B E R 2 2

Collaborative Share Group Discussions Opening Remarks and General Session Pre-scheduled Business Meetings Reception & Illuminators Special Event

T U E S D AY, S E P T E M B E R 2 3

Multiple Educational Sessions & Retailer Spotlight

Pre-scheduled Business Meetings Luncheon Keynote Address

STAND OUT. BE A TRUE AND AUTHENTIC ORIGINAL.

MARK YOUR CALENDAR

September 21 – 23, 2014 | Palm Springs Convention Center | Palm Springs, California

For complete sponsorship information including a list of participating retailers and sponsorship prospectus, contact:

Beth Wright Director, Events & Sponsorship California Grocers Association(916) 448-3545 | (800) 794-3545 bwright@cagrocers.com

Last year’s sponsorship opportunities sold out early so call today to secure your spot Now for this year’s conference.

The 2014 CGA Strategic Conference offers a variety of sponsorship packages and new, customized opportunities to promote your company’s products, equipment, or services. Sponsor benefits range from dedicated use of a Business Conference Suite, to 10' x 10' floor display spaces, or exclusively-presented social events. Whatever your desired outcomes, the 2014 CGA Strategic Conference offers a variety of opportunities to meet your goals and budget.

Don’t miss this unique opportunity to meet with California’s top grocery industry decision-makers. All conference sponsors receive customized, pre-scheduled meeting schedules as part of their investment. Whether you represent a new niche product, or an established national supplier, the CGA Strategic Conference provides a highly productive forum to meet one-on-one with buyers from California’s top retail companies.

Many thanks to

The Illuminators for their continued, generous support of the CGA Strategic Conference by

providing the outstanding conference meal functions and entertaining

social events.

MEET WITH CALIFORNIA’S TOP RETAILERS

“ The CGA Strategic Conference is one of the finest annual resources to better understand the direction of the industry, as well as strengthen relationships between retailer and vendor. The disciplines in place allow for a fast paced, very informative conference, which provides great opportunities for both new business, as well as honing existing programs.”

Kurt Erickson, COO Vallarta Supermarkets

“ This is by far the best conference I attend all year! Where else do you get uninterrupted time to discuss and review your business with so many retail managers and VP’s. At the retailer meetings there is a lot of give and take and both the retailers and myself walk away with a far better understanding of our business needs. This always results in more sales and profits for both of us!!”

Bob Kennedy Jack Link’s

C G A | Board of Directors

CHAIRMAN APPOINTMENTS

Dave Jones Kellogg Company

Bob Parriott Twain Harte Market

Dora Wong Coca-Cola Refreshments

EXECUTIVE COMMITTEE

Chairman of the Board Mary Kasper Fresh & Easy

First Vice Chair Joe Falvey Unified Grocers, Inc.

Second Vice Chair Kevin Konkel Raley’s

Treasurer Diana Godfrey Smart & Final Stores

Secretary Jim Wallace Albertsons LLC

Immediate Past Chair Kevin Davis Bristol Farms

DIRECTORS Raul Aguilar Anheuser-Busch InBev

Jon Alden Jelly Belly Candy Co.

Renee Amen Super A Foods, Inc.

Teresa Anaya Northgate González Markets

Joe Angulo El Super (Bodega Latina Corp.)

Kevin Arceneaux Mondelez International, Inc.

Kelly Augustin United Markets, Inc.

Dennis Belcastro Hillshire Brands Company

Jennifer Bosma Harvest Market

Paul Cooke Nestlé Purina PetCare

Brent Cotten The Hershey Company

Dennis Darling Foods Etc.

Robert Digrigoli Procter & Gamble

Brian Dowling Safeway Inc.

Kendra Doyel Ralphs Grocery Company

John Eagan Costco Wholesale

Jon Giannini Nutricion Fundamental, Inc.

Dick Gong G & G Supermarket, Inc.

Robin Graf Whole Foods Market

Rickey Hamacher Bimbo Bakeries USA

Michel LeClerc North State Grocery, Inc.

Eric Lindberg, Jr. Grocery Outlet, Inc.

Dave Madden MillerCoors

Casey McQuaid E & J Gallo Winery

Dan Meyer Stater Bros. Markets

Omar Milbis Rio Ranch Markets

Phil Miller C&S Wholesale Grocers

Hee-Sook Nelson Gelson’s Markets

Keith Olscamp Campbell Soup Company

Chris Podesto Food 4 Less – Stockton/ Rancho San Miguel Markets

Bob Richardson The Clorox Company

Casey Rodacker Mar-Val Food Stores, Inc.

Dean Ryan Tops Fresh Market

Harish Solanki Big Saver Foods, Inc.

Naresh Solanki Bestway/Gardena Supermarkets

Mimi Song Superior Grocers

Mike Stamper Nestlé Sales Division

Kim Stokes Unilever

Dirk Stump Stump’s Markets

Tiernan Summins Kraft Foods Group, Inc.

John Swindell Food 4 Less/Foods Co. (A Kroger Company)

Paul Turcotte Pepsi Beverages Company — WBU

Jim Van Gorkom NuCal Foods

Kevin Young Young’s Payless Market IGA

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C O N T E N T S | Special Issue

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CALIFORNIA GROCERS ASSOCIATION

President/CEO Ronald Fong

Senior Vice President, Government Relations and Public Policy Keri Askew Bailey

Vice President, Communications Dave Heylen

Vice President, Business Development & Marketing Doug Scholz

Executive Vice President, COO Retail Marketing Services Jeff Snadow

Executive Director, CGA Educational FoundationShiloh London

Director, Events & Sponsorship Beth Wright

Director, CGA Educational Foundation Brianne Page

Director, Local Government Relations Laura Peralta

California Grocer is the official publication of the California Grocers Association.

1215 K Street, Suite 700 Sacramento, CA 95814 (916) 448-3545 (916) 448-2793 Fax www.cagrocers.comFor association members, subscription is included in membership dues. Subscription rate for non-members is $100 and does not include CGA Buyers’ Guide.© 2014 California Grocers AssociationPublisher

Ronald Fong E-mail: rfong@cagrocers.com

Editor Dave Heylen E-mail: dheylen@cagrocers.com

Associate Editor Tony Ortega E-mail: tortega@cagrocers.com

For advertising information contact: Tony Ortega E-mail: tortega@cagrocers.com

CIGA

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FEATURESCOVER STORY: One Voice: Historic Merger Strengthens Grocery Industry In May, the California Independent Grocers Association merged into the California Grocers Association, a strategic move that strengthens the Golden State’s grocery industry.

A Win-Win Situation Three independent grocers with deep roots in California’s grocery industry share their views on why the CGA/CIGA merger will benefit independent grocers statewide.

Q&A: Issues and Opportunities California’s evolving grocery landscape has created new challenges for independent operators, but also new opportunities, says the President and CEO of Unified Grocers, Inc.

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COLUMNSPresident’s Message An Independent’s Dream in California ..................5

From The Chair Typewriters and Grocery Stores .............................7

DEPARTMENTSKnow the Law ....................................................10

CGA News .........................................................14

CGA Staff ..........................................................28

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Unified Grocers salutes CGA on their merger with CIGA. Teaming up for a brighter future and a clearer voice.

Better than ever – together!

Phone: 800-724-7762 | unifiedgrocers.com

Congratulations!

An Independent’s Dream in CaliforniaAs with many immigrant families, my grandfather, Dan Fong, left his family near Guangzhou, China, in the late 1930s to forge a better life in America.

After working various labor-intensive jobs

and saving every nickel they could, he and

his brothers found their way to the American

dream – owning their own business. In his case,

the business was an independent grocery store

called, “Highway Market.” The year was 1941

and over the next 50 years my family grew our

grocery business.

My family’s story is not uncommon. In California,

thousands of families have lived the dream in a

similar manner.

While the small “independent grocer” market

share has dipped in the past decades, the dream

has not. My sisters, cousins and I still recall and

re-live the pride of owning an independent

market. The memories of literally knowing

every customer that walked into our store,

the extraordinary lengths we went to provide

customer service and credit, the great times we

had making 10-cents an hour as kids, the joy of

working together as a family, are etched in our

minds forever.

Independent grocery stores, whether large or

small, all embody the spirit of entrepreneurship

and ownership. We thrive on doing things

differently. We want to have that special touch

for our customers and community, and we want

to be apart from competitors.

Whether our Association members operate

one or 200 stores, the grocery industry’s

business, legislative and regulatory challenges

are common to all. Proposition 65 warning

issues, WIC licensing, minimum wage bills, sick

leave bills, egg regulations – these issues do not

discriminate amongst retailers. That is why I am

particularly pleased that in May the California

Independent Grocers Association (CIGA)

successfully merged with CGA.

More than 125 strong independent grocers,

along with more than 50 supplier companies

that serve them, join hundreds of their peers

that already are CGA members. In fact, nearly

80 percent of CGA’s retail grocery companies are

independent operators.

Congratulations to our newly combined board of

directors for having the vision, forethought and

leadership in bringing small, medium and large

independents and chains together under one

association. We look forward to working closely

with all our members in the years to come

as we collaborate to improve and strengthen

California’s vibrant grocery industry. n

RONALD FONG

President/CEO

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F R O M T H E C H A I R

MARY KASPERCGA Chair of the Board Senior Vice President, General Counsel, Secretary Fresh & Easy

Typewriters and Grocery Stores

Like typewriters, grocery stores have their own personality,

voice and style.

My husband is generally a calm guy, but lately he’s been railing against Tom Hanks.

Mr. Hanks is a vintage typewriter collector. A serious one. And now I’m one, too. It

started with a love letter Tom wrote last summer for the NY Times — “I am TOM. I

Like to TYPE. Hear That?”

Tom writes on a manual typewriter almost every day. As he notes, “…everything you type on

a typewriter sounds grand, the words forming in mini-explosions of SHOOK SHOOK SHOOK.

A thank you note resonates with the same heft as a literary masterpiece.”

I bought an Olivetti Lettera 32 autographed by Tom Hanks last year at a charity auction, and

another collector was born. I have always been intrigued by typewriters, especially when I

found my mom’s 1949 receipt for an Underwood Model 6 that she rented for $5.15 a month to

learn typing for her first job.

I learned to type in high school, back when you needed to know math for centering words

and to format columns. I’ve fallen in love with each of the (more than a few!) machines I now

own. The extra space in our home is filling up, and my husband blames Tom.

There is something magical about typing…the sound of the keys click-clacking, the ding of

the bell at the end of each line, the unique fingerprint of different fonts. There are tons of

different models, a match for every personality and style…the classic grey Underwood; the

sexy green Hermes 3000; the elegant black Remington Streamliner; the sassy red Royal

Quiet De Luxe; the sporty blue Olivetti Lettera 32.

It’s no different with grocery stores. Even with larger chains, each store has its own

personality, voice and style. Our customers are spoiled for choice: large, small, full-service

traditional supermarkets, independents, premium specialty, natural and organic, ethnic,

modern convenience, and more.

Like collecting typewriters, a customer doesn’t have to choose just one, and indeed our

customers love shopping at many different stores each week. Our CGA membership

is extraordinarily diverse, especially with the addition of our new members from the

California Independent Grocers Association (CIGA).

CIGA members, welcome to CGA! We greatly admire your individuality and the distinctive

products and services that you bring to the party. We look forward to getting to know you

better and building an even stronger Association with your support.

Typewriters continue to enchant, even with (or, perhaps, because of) the pervasiveness of

modern technology. Even the slickest laptop simply cannot compete with typing on a vintage

machine and making a unique statement. This is also the case in our stores…we have

complex IT systems, barcodes, scanning, apps, thousands of SKUs, social media and more…

but it’s the personal touch that matters most to our customers.

CGA members deliver that welcoming personal touch and

exceptional customer service with grace and style every single

day, each in our own way. No matter how cool new technology

may be, there’s no substitute for that.

So Tom, thank you. Although I may soon need to rent a

storage unit. n

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THE FUTURE BELONGS TO THOSE

WHO PREPARE FOR IT.

Education is key to unlocking one’s future. The CGA Educational Foundation is dedicated to helping CGA member employees and their dependents achieve their educational goals by assisting with the cost of tuition. To learn more, visit www.cgaef.org.

CGA Educational Foundation1215 K Street, Suite 700 Sacramento, CA 95814(916) 448-3545 / foundation@cagrocers.com

Ralph Waldo Emerson

cgaefCongratsAd0814Tuition_F.pdf 4 8/4/14 10:35 PM

Size: 7.375" x 4.875"Half-Page Ad

Fresh&Easy FNE-BRCN-CC1 v306.11.14 FNE-CGA_Hf-Pg_Ad_

Congratulationsto the California Grocers Association

and California Independent Grocers Association on your merger

and on becoming an even more powerful voice for our industry.

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Dealing With Unwanted SolicitorsEVERY GROCERY RETAILER, LARGE OR SMALL, MUST UNDERSTAND HOW TO DEAL WITH

UNWANTED SOLICITORS NEAR THE ENTRANCES TO THEIR STORES.

These solicitors, such as political signature

gatherers, sometimes aggressively approach

customers entering and leaving stores, causing

discomfort for customers. Store owners and

managers have tried various approaches to deal with

this problem, with varying degrees of success.

Even though the California Supreme Court has

clarified the law regarding the rights of retailers

relative to non-labor union solicitors in front of

stores, local law enforcement officials often don’t

understand the law and decline to arrest solicitors

who refuse to leave. The legal rules applicable

to non-labor union soliciting are not nearly as

complicated as many of the solicitor groups and

some law enforcement officials try to make them.

Many solicitor groups and law enforcement officials

still act as if the entrances and areas outside all retail

stores are “public forums” where the California

constitutional guarantees of free speech require

retailers to provide access to solicitors.

Under prior law as set forth in the well-known

case of Robins v. Pruneyard Shopping Center (1979)

23 Cal.3d 899, the entrance areas of retail stores

in shopping centers were often regarded as public

forums in which retailers could only limit soliciting

through reasonable time, place, and manner

restrictions. That is no longer the case.

In Ralphs Grocery Co. v. UFCWU Local 8 (2012) 55

Cal.4th 1083, the California Supreme Court confirmed

that the entrances, including the store apron

immediately outside the store, are generally not public

forums and that non-union solicitors have no free-

speech rights to be there for purposes of soliciting.

In particular, the Court held that “to be a public

forum under our state Constitution’s liberty-of-

speech provision, an area within a shopping center

must be designed and furnished in a way that

induces shoppers to congregate for purposes of

entertainment, relaxation, or conversation, and not

merely to walk to or from the parking area, or to

walk from one store to another, or to view a store’s

merchandise and advertising displays.” (Ralphs

Grocery Co., 55 Cal.4th 1083, 1093.)

According to the Court, because the entrance areas

of individual stores generally lack seating and

are generally not designed to promote relaxation

and socializing, these entrance areas, as typically

configured, are not public forums. This ruling is

consistent with an earlier lower court decision, Van

v. Target Corp. (2007) 155 Cal.App.4th 1375, where the

court held that the apron and perimeter of certain

Target, Wal-Mart, and Home Depot stores were not

public forums because they were not comprised of

courtyards, plazas or other places designed for people

to spend time together, or be entertained.

For grocery retailers in most shopping centers,

the store apron and perimeter will not qualify as a

public forum under the test set forth in the Ralphs

and Van decisions, and therefore retailers have the

right to ban solicitors from soliciting in those areas.

Solicitors who remain in those areas after being

asked to leave are trespassing.

Trespass is a civil law tort for which the landowner

or tenant can obtain injunctive relief and potentially

recover damages. It is also a crime, for which the

trespasser can be prosecuted. Thus, retail stores

have the option of suing the solicitors for trespassing

in a civil lawsuit seeking an injunction prohibiting

solicitation in the entrance and front area of store.

Additionally, if a solicitor will not voluntarily leave

after being asked by the retailer, the retailer can ask

local law enforcement officials to arrest the solicitor

on criminal trespass charges.

The Ralphs Grocery Co. decision focused on the

rights of union representatives to be present and

picket in front of grocery stores. (See "Know The

Law," Page 40, California Grocer, Issue 6, 2012). In

its decision, the Court also drew a clearer distinction

between the rights of union vs. non-union solicitors.

With the Court’s recent clarification of the law,

retailers have been increasingly successful in

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Before taking legal action against solicitors, retailers should first examine their lease to make sure they have a legal right to control the area where the solicitors are standing.

obtaining injunctive relief from the courts to exclude

non-union solicitors from their store entrances.

However, the success of such actions often depends

on where the solicitors are located and whether

that area is within the retailer’s control. One of

the elements of a trespass is that the retailer has

possession and control over the area from which

they seek to exclude the trespasser. That right of

possession can arise from an ownership or leasehold

interest in the property. Some retail leases do not

include the full apron in front of the entrance or the

parking lot. Some savvy solicitors stay in the area

just outside the store’s leased premises.

Before taking legal action against solicitors, retailers

should first examine their lease to make sure they

have a legal right to control the area where the

solicitors are standing. If the solicitors are in the

parking lot that is controlled by a landlord, you will

likely need the landlord to join you in seeking to

exclude the solicitors.

Having a clear store or company policy regarding

solicitors will also help if you seek assistance from

the court. Some retailers have developed policies to

exclude all solicitors, including charitable groups

like the Girls Scouts and the Salvation Army. Other

retailers have sought to exclude certain groups like

political signature gatherers, while allowing some

charitable groups to solicit in front of their stores.

A few stores that have chosen to exclude only certain

groups from soliciting have faced public relations

and political backlash, and there is the potential for

legal challenge if the distinction between allowed

and prohibited solicitors under a retailer’s policy is

based on gender, race, religious preference, or some

other protected classification.

Some retailers have tried to encourage local law

enforcement to arrest and prosecute unwanted

solicitors under state and local laws regarding

trespass. Due to what they perceive to be ambiguity

in the law, local law enforcement agencies are

generally reluctant to arrest and prosecute solicitors

for trespass.

Some local law enforcement agencies have indicated

that if a store employee is willing to make a citizen’s

arrest, the law enforcement officer will refer that

citizen’s arrest to the District Attorney’s office for

prosecution. California law gives the officer a choice

whether to honor a request for a citizen’s arrest. An

officer does not have to make the arrest if the officer

is not satisfied that there are sufficient grounds for

issuing a criminal complaint. (Penal Code §849(b)(1).)

However, if an officer fails to honor a request for a

citizen’s arrest and it is later determined that there

was sufficient grounds for the arrest, the officer

can be subject to a fine or imprisonment. (Penal

Code §142(a)). One of the primary reasons why law

enforcement agencies prefer these matters to be

K N O W T H E L AW

Continued on p. 12

Downey Brandextends a warm welcome to the

California IndependentGrocers Association members.

We look forward to working with you!

downeybrand.com advancing your interests

Sacramento | Stockton | San Francisco | Reno  

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handled by the citizen’s arrest is because California

law provides that when an officer follows up on a

citizen’s arrest and takes the trespasser into custody,

the officer cannot be sued civilly even if it turns out

that there were not sufficient grounds for the arrest.

There is no similar statutory protection from civil

suits for store employees who make a citizen’s arrest.

For this reason, many retailers have been reluctant to

have their employees request a citizen’s arrest.

Further education of local law enforcement officials

about the rights of retailers under the Ralph’s

decision may result in better and more consistent

enforcement with less insistence on requiring a

store employee to make a citizen’s arrest. In most

instances, unwanted non-union solicitors who

remain on property controlled by a retailer after

being asked to leave are trespassers.

When a store manager asks such a solicitor to leave

in the presence of a police officer, and the solicitor

refuses to leave, the officer should be willing to arrest

the solicitor for trespassing. It will take a significant

education effort to help local law enforcement officers

and their superiors to overcome their reluctance to

arrest and prosecute trespassing solicitors.

Whether you decide to proceed civilly or criminally

to remove unwanted non-union solicitors from your

store front, having a clear understanding of your

rights as outlined above will greatly improve your

chances for success. n

John C. McCarron is a partner in the Food & Ag Practice at Downey Brand, LLP in Sacramento, California. John’s practice focuses on commercial litigation and regulatory issues for food producers, processors and retailers.

K N O W T H E L AW

Continued from p. 11

Proudly Serving Southern California Families Since 1936

e Stater Bros. Supermarket “Family” would like to toast the CGA-CIGA merger!

Welcome CIGA members to CGA!

CGA_mergerAd_2014_Layout 1 5/22/14 11:14 AM Page 1

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Leading Shopping Cart Retrieval CompanyProvides Variety of Options For RetailersCALIFORNIA SHOPPING CART RETRIEVAL CORP. (CSCRC) IS THE INDUSTRY LEADER IN

SHOPPING CART RETRIEVAL, PROVIDING A VARIETY OF RETRIEVAL OPTIONS TO TAILOR-FIT

THE NEEDS OF ITS CLIENTS.

Its president credits the company’s success to its

commitment to providing efficient, cost-effective and

professional services.

“We take our mission statement seriously,” says

Dave Reid, president/CEO of CSCRC. “Over time,

we have built a network of contractors who patrol

neighborhoods across thousands of miles of

public right-of-way in California and Nevada. They

aggressively implemented technologies that help

manage the system and allocate resources.”

The retrieval company is a wholly-owned subsidiary

of the California Grocers Association. It serves nearly

5,000 stores, from national chains to mom-and-pop

stores, and more than 30 municipalities and counties.

Its economy of scale and automated reporting

system allows CSCRC to charge less, while providing

professional, dependable service.

“Carts are at risk from a variety of sources,” Reid

says, “Including pedestrian customers, consumers of

nearby businesses, retail competitors and recyclers.

As the nation's leading cart recovery service, CSCRC

has positioned itself to address these threats.”

The process begins when a cart leaves a retail store's

parking lot, according to Reid.

“The person taking the cart may be a pedestrian

customer who needs a way to take his or her groceries,

or products home,” Reid says. “Scrap metal thieves

sometimes steal shopping carts so they can obtain a

few dollars per cart from an unscrupulous recycler.

In some cities, aggressive public works employees

seize or destroy carts found on public streets, thereby

exacerbating losses to retailers.”

CSCRC contractors patrol the neighborhood around

member stores where most abandoned carts are

located. They also identify sites that commonly attract

carts, like bus stops and bottle redemption centers.

The company encourages residents, businesses and

governments to help quickly retrieve carts by offering

several ways to report cart locations, including our

website, a toll free number and iPhone app. Knowing

a specific location means that drivers can get a cart off

the street even faster.

On-site field agents with extensive backgrounds in

retail loss prevention and customer service oversee

experienced contractors. Their collective experience

in cart retrieval provides CSCRC a unique advantage

over industry competition.

The company developed sophisticated, digital

communications and data networks to allow the near-

instantaneous flow of information from retail clients

and stores to CSCRC and its agents and contractors.

Its proprietary reporting system allows CSCRC to

monitor trends in cart retrieval and offer customers a

custom-configured reporting capability.

“Because we are a wholly-owned subsidiary of CGA,

it reports to a board of member clients, ensuring

our customers can be sure they are getting the best

service possible,” Reid says. n

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A ready supply of shopping carts are an absolute necessity in operating a successful

grocery/retail enterprise. Shopping carts are at risk from the public at large and from

local and state authorities, as well. As the pre-eminent cart recovery service in California,

and Nevada, CSCRC is extremely well positioned to deal with both threats.

Customers will CSCRC easily accessible | We are open daily from 7:00 a.m. to 6:00 p.m.

For more information and to join the program today, call (818) 563-3070.

To report a cart location, call toll free (800) 252-4613 24 hours a day, 7 days a week.

1020 North Lake St., Burbank, CA 91502

www.cartretrieval.net

iPhone CART REPORTING

“WE HAVE AN APP FOR THAT”

CARTSNAP

FOLLOW US ON SOCIAL MEDIA

www.cartretrieval.net

ONE VOICEONE VOICE Historic Merger StrengthensCalifornia’s Grocery Industry

Historic Merger StrengthensCalifornia’s Grocery Industry

O N E V O I C E LEN LEWIS

ONE VOICEONE VOICE Historic Merger StrengthensCalifornia’s Grocery Industry

Historic Merger StrengthensCalifornia’s Grocery Industry

IN A STRATEGIC MOVE THAT STRENGTHENS CALIFORNIA’S GROCERY INDUSTRY,

THE CALIFORNIA INDEPENDENT GROCERS ASSOCIATION (CIGA) MERGED INTO THE

CALIFORNIA GROCERS ASSOCIATION (CGA) ON MAY 1, 2014.

“The importance of this merger cannot be

overstated,” said Ronald Fong, CGA president

and CEO. “The combining of these two great

associations will significantly strengthen the

industry’s advocacy efforts at both the state and

local levels, while providing greater member

services to an even more diverse group of grocery

retailers and suppliers.”

Each association has served California’s

grocery industry for more than 100 years. CGA

represents more than 80 percent of California’s

grocery industry including retail grocery chains,

independents, wholesalers, brokers and suppliers.

CIGA is comprised of independent grocery store

owners operating throughout Northern and

Central California.

This is the second merger for CGA in the past 22

years. The Southern California Grocers Association

merged with CGA in 1992.

“We warmly welcome our new members from

CIGA. Combining our efforts and resources allows

the Association to better serve grocery retailers

throughout California, both large and small,” said

CGA Chair Mary Kasper of Fresh & Easy. “More

retailers will have access to the resources needed

to operate in California’s complex regulatory and

legislative environment.”

In addition, Kasper said, the merger expands

the association’s diverse membership, brings

uniformity to industry messaging and makes

CGA even more responsive to industry changes

and challenges.

“By merging these two associations,” Kasper

said, “CGA firmly establishes itself as the

premier voice of California grocery retailers and

suppliers. The grocery community is one of the

state’s largest employers, and we proudly serve

our neighborhoods in many different ways. We

look forward to working with and learning from

our CIGA colleagues. This merger sends a clear

message we are strong and united.”

Continued on p. 18

O N E V O I C E

“The grocery industry is a vital component of local

communities throughout California,” said former

CIGA Executive Committee Chair Bob Parriott,

Twain Harte Market, Twain Harte, Calif. “By joining

these two long-established grocery organizations we

will greatly increase our sphere of influence in state

and local government.”

CGA has long recognized the critical role

independents play in its advocacy efforts, said

Immediate Past CGA Chair Kevin Davis, Bristol Farms,

noting nearly 80 percent of CGA’s member companies

are independents. “As an independent grocer myself,

I know that when local, family-owned grocery store

owners speak, elected officials are more apt to listen,”

Davis said. “CGA has a very strong advocacy program.

Merging the two associations will only serve to

strengthen its efforts.”

CGA will retain several CIGA signature programs

including its coupon redemption company, annual

educational conference, dental and vision benefits

program, and annual golf tournament. “CIGA

diligently served the independent retail community

for many decades, as has CGA,” Fong said.

“Our new members will have access to CGA’s robust

suite of membership services, including expanded

government relations advocacy, multi-information

channels, numerous networking events and our

educational foundation which provides college

scholarships and tuition reimbursement for

CGA members.”

CGA CREATES INDEPENDENT OPER ATORS COMMIT TEE

With the influx of more than 120 independent grocers due to the CGA/CIGA merger, the California Grocers Association has created the Independent Operators Committee (IOC), comprised of independent retailers from throughout California.

“Independent retailers comprise more than 80 percent of our retail member companies,” CGA President Ron Fong says.

“The IOC will help ensure that the unique needs and challenges facing this class of retailer is being addressed.”

The IOC will assist CGA in monitoring and assessing the unique training, organizational, managerial, labor, marketing, statutory and regulatory compliance needs of independent retailers and recommend appropriate action to the CGA Board of Directors.

The committee will consist of 20 voting members, and an unlimited number of non-voting “advisory” members. Voting members must be the owner-operator of an independent retailer member of CGA.

An owner-operator must be the general manager and/or control at least 25 percent of the voting power of the independent retailer.

Voting members will be nominated by the IOC, elected by the CGA Board of Directors, and serve three-year terms.

The non-voting advisory members may include independent retailers, wholesalers and suppliers serving independent retailers.

At its first meeting, Bob Parriott, Twain Harte Market, was elected committee chair. He will serve on CGA’s Executive Committee as a Chairman appointment. Dennis Darling, Foods Etc., was elected first vice chair and Dick Gong, G&G Supermarket, was elected 2nd vice chair.

Continued from p. 17

O N E V O I C E CONTINUED

Independent Operators Committee Chair Bob Parriott

(center) and CGA Chair Mary Kasper meet with Senate

Republican Leader Bob Huff during this year’s Grocers

Day at the Capitol..|

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CGA EDUCATIONAL FOUNDATION CELEBR ATES L ANDM ARK DONATION

The California Grocers Association Educational Foundation recently received a record donation from the California Independent Grocers Association (CIGA) that will significantly expand the funding of college scholarships, tuition reimbursement and industry educational opportunities for independent grocer members of CGA and their dependents.

The $403,000 gift was the result of the recent merger between CIGA and CGA and represents the single largest donation to the Foundation’s 22-year history.

“We are proud to support the mission of CGAEF,” said former CIGA Executive Committee Chair Bob Parriott, Twain Harte Market. “At a time when students continuously struggle to continue their education while lessening their financial burden, this program ensures that hundreds of students in our industry will receive the financial support they need.”

Parriott presented the check to CGAEF Chair Jim Van Gorkom, NuCal Foods, at a recent CGA Board of Directors meeting.

“CIGA’s donation to CGAEF is a huge investment in the development of tomorrow’s grocery industry leaders,” said CGAEF President Ron Fong. “We are grateful for CIGA’s tremendous generosity and its members which allow the Foundation an opportunity to provide college scholarships to deserving students.”

Currently the largest statewide program in America supporting the grocery industry, the CGAEF’s College Scholarship and Career Development Programs offer $500,000 annually in financial relief from ever-rising costs that prevent many from completing their education.

O N E V O I C E

As part of the merger, CGA created an Independent

Operators Committee (IOC) charged with monitoring

and assessing the unique needs of the independent

retailer (see sidebar).

“With such a tremendous influx of independent

grocery retailers into the association, creating a

committee to focus on the unique challenges and

opportunities of this retail segment made sense,” said

CGA’s Fong.

CIGA’s annual educational conference in Hawaii is

now the Independent Operators Symposium and

open to all CGA independent retail members. The

event is Jan. 11-18, 2015, at the Aulani, a Disney Resort

& Spa, in Ko Olina, Hawaii.

CGA will now offer “member-only” employers dental

and vision insurance products, previously provided

by CIGA. It includes a premier PPO and HMO plan

through Delta Dental and a vision plan through

Vision Service Plan.

As part of the merger, Retail Marketing Services,

Inc. (RMS), which operated the California Coupon

Redemption Center (CCRC), becomes CGA’s second

wholly-owned subsidiary along with the association’s

California Shopping Cart Retrieval Corp.

For more than 50 years, CCRC has served as a

coupon clearinghouse that provides a competitively

priced coupon processing service geared toward

meeting the needs of all retailers, wholesalers and

grocery associations.

Continued on p. 20

Grocery retailers from throughout California

participated in the first Independent Operator

Committee meeting in Sacramento.

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MERGER PROVIDES NEW BENEFITS

With the merger of the California Grocers Association and the California Independent Grocers Association, member companies will have access to a number of new benefits and services.

“Both associations have valuable programs that will benefit the entire membership,” says CGA President Ron Fong.

“The merger was a real win-win for all CGA members.”

Key benefits for the incoming CGA members include increased government relations advocacy, expanded communications, including a weekly e-newsletter and bi-monthly magazine, networking events, and the association’s educational foundation.

“Our government relations program is second to none,” says Fong. “Our team of staff and contract lobbyists closely monitor all levels of government from city councils to the State Legislature. It also monitors California’s complicated regulatory agencies.”

Fong calls the CGA Educational Foundation the association’s “shining star.”

The foundation provides financial assistance to advance the educational goals of CGA member employees and their dependents, as well as offer industry-related educational programming. In addition, the Foundation has published an Emergency Operations Plan and Standard Operating Procedures Manual – a 200-page comprehensive emergency preparedness guide that is free to CGA members.

With the merger of the two associations, CGA acquired its second wholly-owned subsidiary. Along with the California Shopping Cart Retrieval Corp., CGA now operates

the California Coupon Redemption Center, a coupon clearinghouse that has served retailers for more than 50 years.

CGA will continue two of CIGA’s main events, its annual golf tournament and Hawaii educational program. The educational program has been renamed the Independent Operators Symposium.

In addition, CGA will provide dental and vision insurance products for employers through Delta Dental and Vision Service Plan (VSP). More information is available on the CGA website.

CGA members are encouraged to participate on one or more of the association’s committees. These committees range from government relations and communications, to loss prevention and human resources.

CGA created a welcome booklet that was sent to the Association’s newest members several weeks after the merger. The booklet highlights CGA’s numerous benefits.

“I encourage our new members to thoroughly read the booklet and discover all the programs the association offers,” says Fong. “I also recommend visiting www.cagrocers.com for additional information.”

CGA will continue to host the popular annual Sonoma

Golf Tournament.

Former CIGA President Jeff Snadow joins the CGA

executive team and will serve as executive vice

president and chief operating officer of RMS.

Fong said the merger should provide significant

growth opportunities for CCRC. The company will

develop new marketing materials and unveil a new

look in the coming year.

Also as part of the merger, an IOC voting member

will be elected to the CGA Educational Foundation.

Former CIGA board member Kelly Augustine, United

Markets, Inc., was elected to the CGAEF Board of

Trustees at the CGA board meeting on July 11. n

Continued from p. 19

O N E V O I C E CONTINUED

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Congratulations to CGAon the merger with CIGA.

We look forward toworking with the new

CIGA members.

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SAFE Credit Union is thrilled to congratulate CGA as the premier voice of California’s grocery retailers and suppliers

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to thefamily tableWelcome

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A

SITUATION

W I N W I N

THE TERM “WIN-WIN” HAS BECOME SOMETHING OF A CLICHÉ IN BUSINESS CIRCLES. BUT

IT SEEMS TO BE THE BEST DESCRIPTION FOR THE MERGER OF THE CALIFORNIA GROCERS

ASSOCIATION AND THE CALIFORNIA INDEPENDENT GROCERS ASSOCIATION (CIGA) INTO AN

EVEN STRONGER RETAIL PRESENCE THROUGHOUT THE STATE WITH GREATER FINANCIAL,

POLITICAL AND HUMAN RESOURCES.

“It really is a win-win for both associations,” said Dick

Gong, G& G Supermarkets, Petaluma, Calif., whose

family has been operating supermarkets since 1963

and one of three independents interviewed for this

article that will be taking a seat on the CGA Board of

Directors.

Bob Parriott, CEO of Twain Harte Market agreed.

“I worked closely with Ron Fong for a year, driving

things on the CIGA side with two other board

members and things came together beautifully,”

Parriott said. “We got through all the legalese and

made sure everyone got what they wanted. Ron and

his team did a magnificent job of developing a very

well balanced merger and a smooth transition.”

Dennis Darling, another new board member and

operator of Foods, Etc. under the IGA banner, added:

“It’s a great opportunity to speak in one voice across

the state. All the other members, as well as the

CGA staff, have been very welcoming and I can’t

say enough about the part Ron Fong has played in

creating a smooth transition.”

Asked if he’s gotten any feedback from other

members at this point, Darling replied: “I think all

the former members of CIGA are pretty happy. We

have a group of eight independents that were former

CIGA board members. They are all very excited and

positive about the move,” he said.

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Clearly, one of the biggest benefits for independents will be having a combined voice in Sacramento and some representation in Washington, D.C., said Parriott.

W I N W I N

Clearly, one of the biggest benefits for independents

will be having a combined voice in Sacramento and

some representation in Washington, DC, said Parriott.

“At CIGA we had one part time lobbyist,” he said.

“Now we have five working on issues that will have

benefits for all grocers.”

There are also plans in the works to have a compliance

officer at CGA, according to Darling.

“Independents really struggle with staying current on

all laws and regulations,” Darling said. “It’s one of the

most difficult things we do. CGA already has people

to help with that. But the idea is to have one staff

member handle those issues exclusively.”

“Of course the primary focus will continue to be

an advocate for our interests in Sacramento and

Washington,” he added. “It’s amazing some of the

things our legislators can dream up and CGA has

been very effective not only in lobbying but providing

information to our legislators so they can make

informed decisions.”

Gong, whose company has just celebrated its 50th

anniversary and a CIGA member since opening

its doors, said combining the two associations will

benefit the entire California grocery industry.

“Both associations bring a lot to the table and we’ll

be able to combine the best programs of each,” he

said. “This will result in a stronger association with

the critical mass that will help all of us with a wide

spectrum of challenges facing our industry.”

As a new board member, Gong hopes the association

continues to expand the number of committees

addressing specific issues.

“I think these committees have done a great job

of identifying issues and providing solutions for

small and larger independents in areas like human

resources, marketing, and county, city and state

regulations,” he said. “We all have the same problems

and we should now be able to resolve some of them.”

“There’s going to be a lot more challenges facing the

industry in areas like technology and store formats,”

he added. “The merger will enable us to move forward

and meet these challenges with new ideas and tools.”

Having access to association programs like the CGA

Educational Foundation will be a significant benefit

for independents.

Both entities brought something to the table besides

money. “But we had several million dollars of funding

that we moved over. This included a very successful

educational symposium that CIGA held every year in

January. We also made a donation of over $400,000

to the CGA’s Educational Foundation, the largest

donation ever received,” said Parriott. “This really

opened up some new avenues for CGA to do more

education and training for our members’ families and

staffs.”

Discussing other programs, Parriott said CIGA

brings with it a for-profit ccoupon clearinghouse

company that he believes is one of the finest in the

country and will continue to operate under CGA.

“We also have a for-profit arm called RMS — Retail

Marketing Services,” Parriott said. “Like CGA’s

shopping cart business, it’s an umbrella under which

we can operate multiple for-profit companies for the

benefit of our retailers.”

Asked about the potential for new programs, Parriott

said: “We’re always tilling the soil and talking to

anyone that has a good idea. In fact, we’ve been

looking at possibly negotiating some better contracts

for recycling and picking a preferred vendor that

would work primarily with independents. A bigger

voice gives us the ability to negotiate better contracts

that the state mandates.”

Parriott said uniting the two associations will

strengthen independent retailer relationships

statewide. While CGA’s independent membership

stretched across the state, CIGA membership was

primarily in Northern California.

“We have a lot of relationship building to do,” he said

speaking of the independent retailer community. “But

forging those relationships and making new contacts

for the future is a great part of the job.” n

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Q & A

Q&AIssues and OpportunitiesBOB LING, PRESIDENT AND CEO OF UNIFIED GROCERS, INC., WHOSE MEMBERS

GENERATED $3.7 BILLION IN SALES IN FISCAL 2013, DISCUSSED SOME OF THE ISSUES AND

OPPORTUNITIES FACING THE INDEPENDENT RETAILERS WITH CALIFORNIA GROCER.

For some, the recession

may be in the rear view

mirror. But cautious

optimism is still the

watchword among

business leaders

nationwide and in

California, where the

symptoms that led

to the downturn are

dissipating, but have yet to be cured.

Despite some inflation in commodity prices, guarded

consumer spending, drought-related issues and a

troubling regulatory climate, the state’s independent

grocers seem to be in a very good place, with lots of

room for growth and a willingness to experiment with

new formats and categories.

Q: Just to put everything in context, how would you

assess 2014 so far for the industry?

A: “Speaking for our members, we’re generally

seeing a steady improvement in performance.

What’s encouraging is that improvements are

across various formats and geography.”

Q: How big an issue is the economy?

A: “I think there are signs of improvement in

certain areas, but it hasn’t taken hold in every

corner of the state.”

Q: Is there any such thing as full recovery?

BY LEN LEWIS

Continued on p. 26

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A: “The question is what it would look like. There’s

still significant opportunities for improvement.

Consumers are still very cautious and focusing

on value. You can characterize our retailers the

same way.”

Q: Does that mean they’re being cautious with

expansion and remodeling?

A: “Just the opposite. We are seeing a modest, but

visible acceleration in growth among those who

have survived the recession. There are more

stores opening this year than last, and we expect

that trend to continue. Certainly our members

are closely watching the Safeway transaction

and what it might mean in terms of picking up

additional stores, or expanding their presence in

a particular marketplace.”

Q: Sounds like that could be a great opportunity?

A: “It can be. No one knows at this stage the

breadth of stores that might be available.

Regardless, there will be some disruption in the

market. Typically that benefits independents.”

Q: What other issues concern you right now?

A: “Well, the focus on value, combined with the

lack of even modest inflation in food outside of

meat. It’s put a lot of stress on margins. So, we

have to make sure we are as cost effective as we

can be.”

Q: Do you see the low inflation rate continuing?

A: “There’s some evidence that we might be

seeing an acceleration as a result of increased

commodity prices. I think the opportunities

to shrink-pack size, or other tactics that

manufacturers used in past, are narrowing. For

the first time in a while higher costs might be

passed through to consumers.”

Q: Would you say the general business climate in

California is improving?

A: “In a general sense, yes. There is some

stabilization in the economy overall, but

the regulatory, tax and other burdens placed

on small and large businesses have not

been reversed.”

Q: What about trends at the store level? What’s the

hot button?

A: “There’s several. First, the value proposition

is as strong and impactful as ever for all

formats, and across the demographic spectrum.

Additionally, healthier eating alternatives are no

longer a trend. They are becoming mainstream.

It’s no longer limited to stores that have

traditionally focused on those products.”

Q: Are independents broadening selection in

these segments?

A: “Many stores are expanding their offerings

either through a complete store focus, or

redesigning their stores so these items are

featured or incorporated into their everyday sets.

We’re seeing it across the board in branded and

private label. We have our Natural Directions

label for natural and organic and it’s growing

very fast.”

Q: What do you see as the independents’ great

strengths moving forward?

A: “It’s what’s been their greatest strength for

decades – the ability to respond quickly to

changes in the market and serve the needs of

many different customers whether it’s with

wellness products, or ethnic specialties. That

agility is what’s made independents successful.”

Q: What’s the situation with family-owned

businesses?

A: “We’ll continue to see strong family businesses.

For one thing, we’ve seen more private equity

firms getting into the market in the past two

years and I believe that trend will accelerate.”

Continued on p. 52

Continued from p. 25

Q & A|

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Q: Is that good or bad?

A: “That’s in the eye of the beholder. But private

equity firms put money in places where they see

growth opportunities. Clearly, the independent

arena is one of them. When firms are acquired,

they tend to focus on growth and that’s

something we encourage.”

Q: Seems like it’s a good time in history to be an

independent?

A: “It’s a point in time where there’s disruption

and change. There’s an opportunity for smart,

reasonably capitalized companies to capture

market share. Consumers have a ton of choices

for grocery shopping these days.”

Q: The grocery store isn’t going away. Operators

are finding alternatives like new formats to serve

their customers. Often, those operators are

independents.

A: “The industry will never return to what it was

years ago. One consistent theme is the faith that

customers have in their stores. Supermarkets

have credibility as providers of products and

information.”

Q: Looking ahead, what other issues should we be

looking at in 2014 and beyond?

A: “There’s still a lot of uncertainty about the

economy along with the political and regulatory

situations, drought and the infrastructure that

are creating a headwind for investment and

profitability in our state.” n

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HAVE A QUESTION?The CGA staff is here to

serve you.

For more than 100 years, the California Grocers Association has served the needs of grocers and suppliers. Listed below is CGA’s staff and responsibilities. Photocopy this page and keep it as a handy reference. To

reach staff, call (916) 448-3545, e-mail, or

visit our website: www.cagrocers.com.

DAVE HEYLEN Vice President Communicationsdheylen@cagrocers.com

Editor, California Grocer, Checkout, Media Spokesperson

RONALD FONG President and CEO California Grocers Association President, CGA Educational Foundationrfong@cagrocers.com

SHILOH LONDON Executive Director CGA Educational Foundationslondon@cagrocers.com

Chief Development Officer, Industry Education, Foundation Relations

JEFF SNADOW Executive Vice President/COO Retail Marketing Servicesjsnadow@cagrocers.com

Beth Wright, Directorbwright@cagrocers.com

Events and Sponsorship

Brianne Page, Directorbpage@cagrocers.com

CGA Educational Foundation

Laura Peralta, Directorlperalta@cagrocers.com

Local Government Relations: Southern California

Tony Ortega, Managertortega@cagrocers.com

Sales & Marketing

Tim James, Managertjames@cagrocers.com

Local Government Relations: Northern California

Sunny Chang, Managerschang@cagrocers.com

Marketing & Membership

Dane Hutchings, Managerdhutchings@cagrocers.com

State Government Relations

Lesley Hall, Manager lhall@cagrocers.com

Administration Executive Assistant to President/CEO

Robin Coggeshall, Staff Accountant rcoggeshall@cagrocers.com

Danielle Whitley, Manager dwhitley@cagrocers.com

Retail Marketing Services

Marisol Martinez, Receptionist mmartinez@cagrocers.com

KERI ASKEW BAILEY Senior Vice President Government Relations & Public Policy kbailey@cagrocers.com

Chief Lobbyist, Government Relations Committee Liaison, GROPAC

DOUG SCHOLZVice President Business Development & Marketingdscholz@cagrocers.com

Business Development/Marketing, CGA Strategic Conference, Membership

C G A S TA F F|

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PAGE COMPANY PHONE FAX EMAIL WEBSITE

24 Bristol Farms 310-233-4700 310-233-4701 www.bristolfarms.com

BC California Lottery 916-322-5136 www.calottery.com

11 Downey Brand LLP 916-520-5316 916-520-5716 bapplegate@downeybrand.com www.downeybrand.com

27 Food 4 Less (Stockton)/ 209-957-4917 209-956-8550 www.myfood-4-less.com Rancho San Miguel Markets

IBC Foods Etc. 707-994-6423 707-994-8399 foodsetc@mchsi.com www.foodsetc.iga.com

9 Fresh & Easy Neighborhood Market Inc. 310-341-1501 310-341-1201 www.freshandeasy.com

24 Matson & Isom 530-891-6474 530-893-6689 bgibbs@matson-isom.com www.matson-isom.com

9 NuCal Foods 209-254-2200 209-254-2255 www.nucalfoods.com

21 Raley’s 916-373-3333 916-444-3733 www.raleys.com

21 Safe Credit Union 916-979-7233 916-971-4574 james.allen@safecu.org www.safecu.org

21 Smart & Final Stores 323-869-7500 323-869-7862 www.smartandfinal.com

12 Stater Bros. Markets 909-733-5000 www.staterbros.com

24 Sunny Delight Beverages Company 949-481-1639 bob.sopko@sunnyd.com www.sunnyd.com

4 Unified Grocers, Inc. 323-264-5200 323-262-0658 customercare@unifiedgrocers.com www.unifiedgrocers.com

AD

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Join Our ConversationThe California Grocers Association is now on Facebook, Pinterest, Twitter, LinkedIn and Instagram. Join the conversation and follow what’s happening in our industry. Share press releases, new store openings, employment promotions and other company information. Stay up-to-date with the latest happening in state and local government. It’s all just a click away!

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