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The Shelby Report of the West • DECEMBER 2016
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Bay Area Grocer Celebrates Three Decades in Business Mollie Stone’s Markets has been celebrating its 30th anniversary all year long, with product promotions and food tastings from local farms and products taking place in the company’s nine San Francisco Bay Area stores. But the culmination of the celebration came in October, with a big birthday bash that featured not only food sampling, but also storewide sales, giveways and the donation of $30,000 to 30 local nonprofits. The company remains independently owned by Mollie Stone’s son, Mike, who founded the business in 1986 and named it in honor of his mother, who already had passed away.
“Our goal 30 years ago was to bring local and organic food to our community and to make a difference in people’s lives though food,” says Mike Stone, CEO of Mollie Stone’s. “We later added conventional groceries to make our stores ‘the best of both worlds.’ We couldn’t be more proud of all that we have accomplished and look forward to continue providing exceptional service and the best quality and healthiest foods for years to come.”
The Mollie Stone’s Market in Greenbrae.
Local organic fruits and vegetables are delivered daily.
An extensive homewares section complements the Greenbrae store’s food offerings.
Mollie’s deli features items like gourmet meals to-go, charcuterie, sandwiches, fried chicken, mashed potatoes and gravy.
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The Hot Foods To Go Bar serves up freshly prepared ethnic and classic dishes, as well as soup. A variety of salads complement the hot foods.
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The Shelby Report of the West • DECEMBER 2016
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Stone Founded Mollie Stone’s to Make a Difference Through Food Since its founding in October 1986, Mollie Stone’s has expanded to nine locations and remains one of the few independently owned grocery chains in the San Francisco Bay Area, according to the company, which is based in Mill Valley. The family business enjoys a low turnover rate (less than 20 percent) and has employees that have been around for much of the company’s three decades of business. Suppliers have become friends, too. It’s just a gratifying business to be in, according to co-founder and CEO Mike Stone. (His co-founder, David Bennett, was with the company 1985-2013 and now is an industry consultant and speaker.) “Our markets have been fortunate to grow over the past 30 years within amazing communities and amongst wonderful neighbors,” he says. Stone sat down with The Shelby Report’s Bob Reeves at the California Grocers Association Strategic Conference in October 2016 to talk about his time in the industry and what prompted him to start his own company, his company’s milestone anniversary, what’s ahead and more. Reeves: Let’s start with your entry into the food industry and how that came about. Stone: I started working for Vons in 1968 as a bagger. I worked for them for about seven years, working my way through high school and college. I got my degree and got an offer from a grocery wholesale company in San Francisco in their accounting department because I had a degree in accounting and finance. One thing led to another, and one of my accounts offered me a job to come work for them. He had one Mollie Stone’s Markets are located at: store at the time; we built it up to 1477 Chapin Avenue, Burlingame four stores. 270 Bon Air Center, Greenbrae 164 S. California Avenue, Palo Alto My mother, who is Mollie, 22 Bayhill Shopping Center, San Bruno worked in the grocery business 4201 18th Street, San Francisco (Castro) for about 45 years. 2435 California Street, San Francisco (Pacific Heights) Doing what? 635 Portola Drive, San Francisco She was a deli manager for Vons. (Twin Peaks) Prior to that, she worked for Boys 49 West 42nd Avenue, San Mateo Markets in L.A. She passed away in 100 Harbor Drive, Sausalito 1983; my father preceded her about nine
months earlier. At that time I was scratching my head as far as having a purpose, wondering if I was going to stay in the grocery store or in the grocery business. I opened the largest natural food store in 1986 in Redwood City. We had gluten-free, macrobiotic sections. The whole store was sugar free—no added-sugar products in the store, we only carried sugar-free (ice creams, for instance). That store was called what? That was the first Mollie Stone’s; I named it after my Mike Stone mother. She never got an opportunity to see the store. We had the largest natural food store in Northern California at the time, so we were a little bit ahead of our time. We had a sushi bar, we had a juice bar, a big seating area. We had natural beef that was brought in from Colorado once a week, and I would say about 70 percent of our produce was organic. In those days, organic produce wasn’t as prevalent as it is today because I had to go to L.A. and buy from Albert’s Organics a lot. In Northern California, it was hard unless you dealt directly with the farmer. In 1988, we had an opportunity to buy another store that was a conventional store. So we took that over and integrated the natural food into the conventional store and made a hybrid store. Now, every store has both organic and conventional products in it. Was the concept of going with an organic/natural store just something in your head, something you always wanted to do? No. The reason I opened the natural food store was it gave me purpose after I lost my folks. I wanted to make a difference in people’s lives through food. That store doesn’t exist today; we closed it in 1996. But we have nine other stores…from Palo Alto to Greenbrae to Marin County. We have three in San Francisco, two in Marin County and four on the peninsula. Whole Foods had like six or seven stores in Texas when we opened our store in Redwood City. The first California Whole Foods Market (Palo Alto, 1989) was about four miles from my store in Palo Alto. Now I’m big; I’ve got nine stores and Whole Foods has 300-some-odd stores (laughing).
E&J Gallo Winery and Gallo Sales Company Congratulates Mollie Stone’s Markets on its 30th Anniversary! Cheers to Another 30 Years and Beyond! All The Best From Your Proud Partners, E&J Gallo Winery and Gallo Sales Company.
Mol
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I don’t want to use any clichés or anything, but we grew the stores organically, right? One at a time and took opportunities as they came about. Were your parents into organics? Your mom, in particular? No. Did your parents pass away from health issues? Yes, heart attack. At that point, I had been in the grocery business about 17 years, and I didn’t want to be in the grocery business for the rest of my life without having a real purpose. So I found that purpose and found a niche and built from that.
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50 types of mustard. If a customer comes in and requests something, we bring it in. Unlike bigger chains, where…their hands are tied because it doesn’t get the turns, we’ll bring it in. So the variety we have, people know they can come to our store and find things they can’t get at another store. Do you have a huge craft beer section? Yes, a huge craft beer section. It’s probably one of our biggest areas of increase in the whole store.
You must have been learning as you went because you didn’t have a background in natural foods or organics or anything like that. Right. I hired a nutritionist that worked in the store and gave us a lot of recommendations. The vendor community of natural food or health food or organic food at the time was to a certain point limited because certain products you could only get if you had a vitamin store or a 100 percent natural food store. So products like dog food, vitamins, some other items, sometimes it was a hard supply line—nowhere close to what it is today. How would you describe your customer? The Mollie Stone’s customer is very educated and health-minded, (typically with a) good job or good pay scale. (We also have customers with) health ailments like celiac disease. In the early days, a lot of people didn’t recognize they had celiac, but the ones that did would come to our store because they were able to get those products. People that were on special diets, had special needs, they knew they could get what they needed at our store. It was really a learning experience. We learned from the health food industry, plus we hired a couple of good people that had the knowledge. Did you try to select store locations based on whether they were near a hospital, for example, or near an athletic club, anything like that? To a certain extent. I would say probably right now, four of my stores are pretty close to a university. The store in Palo Alto is close to Stanford. All three of my stores in San Francisco are all close to hospitals or universities. One of my stores in Marin is close to a hospital. So we didn’t exactly target it, but we looked for areas that we thought were good areas, had our clientele in it and it had a good combination. San Francisco obviously has the density. Being at the forefront of that type of operation and also the fact that you were a “hybrid” of a mainstream grocery store and a health food store, I assume your prices are a little higher than a conventional store? Organic products still today are higher (in price). But in those days they were a lot higher than they are today because it’s supply and demand. Society has come quite a way as far as education, but we still have this huge curve to conquer as far as educating the customer. Even today, it’s a lot of education as to why organic food is better for you. We still sell a lot of conventional products in our store, but we use the term “best of both worlds” because we have given people choices of organic, natural, specialty and conventional products.
In addition to a large selection of craft beers, Mollie Stone’s also carries an extensive collection of wines, including some limited-production varieties.
It’s amazing when you look across the country, whether it’s in Oregon or Cincinnati, you see beers you’ve never seen before, and it’s almost becoming territorial as far as the craft beer making. Now all of a sudden they’re popping up all over the place. Go to Oregon and wow, they have a better craft beer section than I do; well, there’s more local, more people are into it, or whatever. But it’s incredible how that category…there’s more women buying the craft beers than ever before. Are you anticipating opening new stores or making acquisitions? We’re constantly looking for new stores, but we’re selective. We’re independently owned, family owned—my family. I have two sons that work in the business, Elliott and Aaron. They’re both doing a terrific job. They’re both passionate about the business. Tell me about you. Are you planning to retire any time soon? I love the business, I love the people in the business, I love the customers, and that’s what I’ve always enjoyed doing. It depends how quickly the boys get up Please see page 16
Mike and Elliott Stone at the FIM Class of 2016 capstone presentations at USC.
All about Mollie Stone’s Markets, in the company’s own words…
Mollie Stone’s sells USDA Choice and Prime meats and local grass-fed beef as well as organic and non-GMO poultry, hand-cut fish, housemade sausages and oven-ready entrées.
Do you still have a nutritionist in each store? No, I don’t have nutritionists in each store today, but I have vitamin experts or people who are very talented and very knowledgeable about products when it comes to food. We use some technology with educating in-store. People can access information on a computer and that sort of thing. Seems to me, and maybe you have done this, that you could do “road shows,” inviting vendors to come in and go through each one of your stores for a week and do a little dogand-pony show. Funny you mention that; we’ve done that. We do that periodically. They show new products and sample. Aside from the organics and natural and that sort of thing, what would you say is the customer’s biggest draw into your store? Two things: one is variety and one is quality. As far as variety goes, we might carry 100 different types of olive oil, or we might carry
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The Best of Both Worlds Founded in 1986, Mollie Stone’s Markets is committed to providing the best possible shopping experience for customers and making a difference in people’s lives through food. Mollie Stone’s first market was in Redwood City, California, and we carried only natural and organic products. We realized that customers wanted a place where they could get not only their natural and organic produce, meats, health and beauty products, but also conventional necessities such as vitamin-enriched cereals and popular name-brand products. Therefore, the concept of “Best of Both Worlds” was born. This marriage of Necessity & Passion Shopping sets our stores apart from most. Our roots remain in healthy, natural and specialty foods. Mollie Stone’s buyers work closely with local producers around the greater Bay Area to bring you high quality products in every aisle. Family Owned, Locally Devoted Over the years, we have remained dedicated to our customers and community. Giving back to the community is top priority, so we actively partner with local schools and food banks. We also like to make our customers’ lives a little easier, we’ve introduced services like the Mollie Bus shuttle service in San Francisco and Mollieland childcare at our San Mateo store. Our goal is to surprise and delight customers when they shop Mollie Stone’s. Please tell us if there’s a product that would make your shopping experience more fulfilling.
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The Shelby Report of the West • DECEMBER 2016
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San Bruno Mollie Stone’s Features Mollie’s Ace Hardware
The Epicurean Cheese Shop features locally made and farmstead cheeses.
The “Grand Central Deli” in Mollie Stone’s.
In November 2014, the Mollie Stone’s in San Bruno cut the ribbon on its Ace Hardware, a complete, fullservice hardware store within its walls, as part of a major remodel. Mollie’s Garage, as the Ace store is called, includes a full-service paint department, lawn & garden, specialty lines such as Big Green Egg and Yeti, and “everything else needed to maintain homes.” “We researched solutions in stores across the country to inform a carefully designed merchandising plan that appeals to both food and hardware shoppers,” said Mike Stone, CEO. “Customers will enjoy the convenience of picking up supplies for their gardens and other DIY home projects at the same time as their groceries.”
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to speed and I feel comfortable with letting go. But at some point, I might let go. Don’t know how much I might let go…we’ll see. Who is your supplier? Unified Grocers. Your specialty supplier? UNFI (United Natural Foods Inc.) and Unified, too (Market Centre). And a lot of direct items... What would you like to add? Celebrating our 30th anniversary this year, it’s really a compliment to all the people who work for us. People are what make the business. This year we have contributed $30,000 to nonprofits; in October we donated to 30 different nonprofits. We wanted to show our appreciation to the local nonprofits throughout the Bay Area for all that they do. A little bit goes a long way, and we are excited to see these nonprofits’ efforts continue to support our communities. We do huge donations to a local hospital and have contributed over $250,000 this year to schools. We donate primarily to schools, churches, synagogues in our marketing areas, and we’re very involved in building a new hospital in Marin. In fact, I am head of the capital campaign for the hospital. In addition to that, we donate a lot of food to the San Francisco Food Bank. I think this year we’ll provide over 100,000 meals to needy people. We’re very proud of that. Being in the business for so many years, it’s easier to connect the dots going back instead of forward, but people don’t realize how lucky we are to be in this industry and make people happy through food and satisfying them through food because everybody has to eat. It’s very gratifying to be in this business.
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