Joe x Two: H-E-B Opens Second Joe V's Smart Shop Discount Grocery Market in Houston, Texas Today

Texas supermarket chain H-E-B opened its second Joe V's Smart Shop discount grocery store today. The store, like the flagship Joe V's which opened in May of this year, is in Houston, Texas. It's at Wallisville & Uvalde in East Houston, across town from Joe V's Smart Shop number one. Here's the grand opening ad.

The first Joe V's Smart Shop store, which is at 12035 Antoine Drive in Houston, was a test of the limited assortment discount format by H-E-B. The format passed the test, at least as far as doing good enough in Houston to warrant a second store in the city, according to Jose Villarreal , Joe V's general manager.

In September of this year Fresh & Easy Buzz correctly predicted H-E-B would open a second Joe V's Smart Shop store in the city. Read our story - September 12, 2010: Shout it Out Loud Joe: H-E-B Opening Second Joe V's Smart Shop Discount Grocery Store in Houston, Texas. Also see - August 26, 2010: What's Up With Joe? Texas Grocer H-E-B Planning 'Major Announcement' About its Joe V's Smart Shop Soon.

Shortly after the first store opened in early May of this year, iconic grocery chain Trader Joe's filed a lawsuit against H-E-B, asking a judge to order the grocer to cease from using the Joe V's Smart Shop name, arguing that it infringes on the Trader Joe's trademark. We're told the case is still pending. However, the court denied Trader Joe's initial request to order H-E-B not to use the Joe V's name pending a resolution of the lawsuit.

Although Texas-based H-E-B doesn't say it's the case, the grocer developed Joe V's in-part because of the movement of hard-discount grocer Aldi USA into its home market in 2009. Germany-based Aldi continues to open new stores in the Lone Star State, where it plans to have a significant presence.

The Joe V's Smart Shop stores are much bigger - four-to-five times bigger, in fact - than the 10,000-12,000 square-foot Aldi discount markets. The stores also offer more than twice as many SKUs - about 9,000 at Joe V's, compared to about 3,500 at Aldi USA.

H-E-B isn't a discount food and grocery retailer like Aldi is. Its two primary formats are superstore (H-E-B) and upscale-specialty (Central Market). However, there's only so much share of stomach and pantry, even in Texas. Therefore H-E-B, which has done an excellent job over the years with its superstores taking on mega-retailer Walmart in its home state of Texas, wants a discount format that it can strategically position against the Aldi small-format, hard-discount stores opening throughout the state. That format appears to be Joe V's Smart Shop - at least to the tune of two stores in Houston so far.

Related Stories

September 12, 2010: Shout it Out Loud Joe: H-E-B Opening Second Joe V's Smart Shop Discount Grocery Store in Houston, Texas

August 26, 2010: What's Up With Joe? Texas Grocer H-E-B Planning 'Major Announcement' About its Joe V's Smart Shop Soon

May 5, 2010: H-E-B Opens Joe V's Smart Shop Discount Prototype Grocery Store in Houston TX ... But Where's Joe?

May 6, 2010: Say it Ain't So Joe: Trader Joe's Tells H-E-B's Joe V's Smart Shop to Change its Name

May 20, 2010: H-E-B Tweaking Product Assortment at Joe V's Smart Shop Discount Grocery Store in Texas Opened May 5

May 20, 2010: 'The Insider': Welcome to Discountopia USA

Shout it Out Loud Joe: H-E-B Opening Second Joe V's Smart Shop Discount Grocery Store in Houston, Texas

H-E-B's Joe V's Smart Shop, at 12035 Antoine Drive, Houston, Texas. The Joe V's format is everyday-low-price focused, limited assortment and fairly no-frills. The flagship store, which opened on May 5 of this year, is about 50,000 square-feet and stocks approximately 9,000 SKUs. It offers all the traditional supermarket departments, from meat, produce and deli, to perishables, grocery and non-foods. [Photo credit: Vicky Pink for Houston Style Magazine. Photo courtesy of Houston Style Magazine. The photograph was taken on may 26, 2010.]

On August 26, 2010 we wrote and published this piece - What's Up With Joe? Texas Grocer H-E-B Planning 'Major Announcement' About its Joe V's Smart Shop Soon - about a 'major announcement' we learned Texas food and grocery retailer H-E-B was soon to make about its start up Joe V's Smart Shop discount grocery chain.

Currently there's one Joe V's store, located at 12035 Antoine Drive in Houston, Texas, which opened on May 5, 2010. But that's about to change.

In the August 26 piece linked above we offered five predictions about what the major announcement might be. The five predictions, in rank order are:

1. H-E-B will announce it plans to open a second Joe V's Smart Shop store in the Houston, Texas region.

2. H-E-B will announce it's settled the trademark law suit filed by grocer Trader Joe's - in which TJ's argues the Joe V's Smart Shop name is an infringement on the Trader Joe's name, asking a court to order H-E-B to cease from using the Joe V's name for the store - and therefore can continue using the Joe V's Smart Shop name for the chain.

[See: Say it Ain't So Joe: Trader Joe's Tells H-E-B's Joe V's Smart Shop to Change its Name. The case is still in court. The court has permitted H-E-B to continue using the Joe V's Smart Shop name until the case is settled or a decision ordered by the court.]

3. H-E-B will announce it will change the name from Joe' V's Smart Shop to something else. See number two.

4. H-E-B will announce it plans to open a second Joe V's Smart Shop store in Texas, but outside of the Houston Metro region.

5. Jose (Joe) Villarreal will announce (perhaps at a "Major" press conference) that he is indeed the "Joe" behind the Joe V's Smart Shop name. An executive of Trader Joe's, attending the press conference, will shout: "Say it ain't so - Joe," over and over again, following Joe Villarreal's announcement.

We suggest you read the full August 26 piece here.

A look at a portion of the produce department in the flagship Joe V's Smart Shop store, at 12035 Antoine Drive, Houston, Texas. [Photo credit: Vicky Pink for Houston Style Magazine. Photo courtesy of Houston Style Magazine. The photograph was taken on May 26, 2010.]

The 'major announcement'

Drum roll please... We've now learned what H-E-B's major announcement about its Joe V's Smart Shop is - and we got it right in prediction number one.

H-E-B plans to open a second Joe V's Smart Shop discount grocery store in Houston, Texas.

Joe V's unit number two will be on Wallisville and Uvalde Road in East Houston. H-E-B's Joe V's Smart Shop has confirmed the 'major announcement' for Fresh & Easy Buzz.

The grocer plans to open the East Houston Joe V's Smart Shop unit before the end of this year.

Shout it out loud...Joe

It appears Fresh & Easy Buzz not only is the only publication, including the local Houston newspapers, we can find, based on doing a number of different google keyword searches moments ago, that reported on Joe V's upcoming announcement in our August 26 piece, we also to appear to be the first publication to report on what that 'major announcement' is.

Prior to publishing this piece we conducted Google searches under 'Joe V's Smart Shop,' 'Joe V's', 'H-E-B,' 'HEB,' 'H.E. Butt Grocery Company,' and a couple others, and can't find any reports of the announcement, including in the local Houston, Texas online newspaper sites, or in the major mainstream supermarket industry trade publications. We may have missed such reports. If you find a story published prior to today - Sunday, September 12, at 11:01 am - about H-E-B's second Joe V's Smart Shop store, please let us know using the comments box at the end of this piece.

We don't care all that much about being the first (or even the only) publication we can find to report this significant news.

Instead, we're just surprised to be unable to find any other coverage of the second store of a new format- Joe V's Smart Shop - from one of America's largest family-owned - over $15 billion in annual sales, over 300 stores in Texas and Mexico, and about 75,000 employees - and best merchandised-operated food and grocery chains, San Antonio, Texas-based H-E-B.

H-E-B , which is celebrating its 105th birthday this year, was founded in 1905 by Florence Butt, who opened a small grocery market called C.C. Butt Grocery Store in the Texas Hill Country town of Kerrville. In the 1920's, Florence Butt's youngest son, Howard, started to grow the company and store-count. Later on the company name was changed to the Butt Grocery Company and then to H.E. Butt Grocery Company, as in Howard Butt. The family has used the name H-E-B since the 1940's, however.

105 years, 300-plus more stores, numerous banners and formats, multiple private brands, and about $15-plus billion in annual sales later, Texas born, bred and based H-E-B is still owned by the Butt family, which continues to grow the food and grocery retailing company not only in size but in multiple formats - ranging from the flagship H-E-B banner and the very successful upscale Central Market, to its newest, the price-impact Joe V's Smart Shop chain, the second store of which opens in East Houston later this year.

Related Stories:

August 26, 2010: What's Up With Joe? Texas Grocer H-E-B Planning 'Major Announcement' About its Joe V's Smart Shop Soon

May 5, 2010: H-E-B Opens Joe V's Smart Shop Discount Prototype Grocery Store in Houston TX ... But Where's Joe?

May 6, 2010: Say it Ain't So Joe: Trader Joe's Tells H-E-B's Joe V's Smart Shop to Change its Name

May 20, 2010: H-E-B Tweaking Product Assortment at Joe V's Smart Shop Discount Grocery Store in Texas Opened May 5

May 20, 2010: 'The Insider': Welcome to Discountopia USA

What's Up With Joe? Texas Grocer H-E-B Planning 'Major Announcement' About its Joe V's Smart Shop Soon

New Format Development in the 21rst Century

We've been closely following Texas-based grocer H-E-B's Joe V's Smart Shop price-focused discount grocery store in Houston, Texas (12035 Antoine Drive) since before it opened in May of this year for four main reasons. Those reasons are:

H-E-B is among a handful of the best food and grocery retailers in the United States - and globally. Number two follows from that premise, which is that anything new H-E-B does - particularly when it's a brand new discount grocery store format like Joe V's, discount grocery retailing being something that H-E-B doesn't specialize in - warrants close following by any serious food and grocery retailing analyst and publication. Third: New formats matter. Innovation matters. And lastly, we plain just love new formats.

Below are our past stories about H-E-B's Joe V's Smart Shop:

>May 5, 2010: H-E-B Opens Joe V's Smart Shop Discount Prototype Grocery Store in Houston TX ... But Where's Joe?

>May 6, 2010: Say it Ain't So Joe: Trader Joe's Tells H-E-B's Joe V's Smart Shop to Change its Name

>May 20, 2010: H-E-B Tweaking Product Assortment at Joe V's Smart Shop Discount Grocery Store in Texas Opened May 5

>May 20, 2010: 'The Insider': Welcome to Discountopia USA

Inside Joe V's Smart Shop in Houston Texas: Joe V's has all of the traditional supermarket grocery and fresh foods departments. The format features a limited-item selection. The focus is on everyday low price, although H-E-B has a weekly advertising circular for Joe V's, offering specials. The Joe V's Smart Shop format also features price-focused in-and-out deals on non-foods items, like the comforters pictured above.

As you can see, it's been three months since we last wrote about Joe V's Smart Shop. But we've been following the store's development closely - perhaps closer than any other food and grocery retailing publication out there.

And something 'Big' is is about to happen in Joe V's land, deep in the heart of Texas.

That something big is a soon to be made "Major Announcement" by H-E-B about its Joe V's Smart Shop, according to Joe V's general manager Jose (Joe) Villarreal, who might or might not be the "Joe" behind the name of the start up, price-focused grocery chain's name? Or as he likes to day about Joe V's: "Are you ready to deliver the best Price Format Store in Texas"

Mr. Villarreal is sworn to secrecy in terms of publicly declaring he is that Joe. Therefore readers, you'll have to make your own determination on the judgement for now.

Jose (Joe) Villarreal is also sworn to secrecy on the content of what he says will be this upcoming "Major Announcement." But he says it will be "Big" - and that it's coming soon.

Unable to pry anything further out of the man outside of resorting to water boarding, Fresh & Easy Buzz has decided to attempt to predict what the upcoming "Major Announcement" from H-E-B about its Joe V's Smart Shop just might be. Our five predictions go from most likely to least likely below:

1. H-E-B will announce it plans to open a second Joe V's Smart Shop store in the Houston, Texas region.

2. H-E-B will announce it's settled the trademark law suit filed by grocer Trader Joe's - in which TJ's argues the Joe V's Smart Shop name is an infringement on the Trader Joe's name, asking a court to order H-E-B to cease from using the Joe V's name for the store - and therefore can continue using the Joe V's Smart Shop name for the chain.

See: Say it Ain't So Joe: Trader Joe's Tells H-E-B's Joe V's Smart Shop to Change its Name. The case is still in court. The court has permitted H-E-B to continue using the Joe V's Smart Shop name until the case is settled or a decision ordered by the court.

3. H-E-B will announce it will change the name from Joe' V's Smart Shop to something else. See number two.

4. H-E-B will announce it plans to open a second Joe V's Smart Shop store in Texas, but outside of the Houston Metro region.

5. Jose (Joe) Villarreal will announce (perhaps at a "Major" press conference) that he is indeed the "Joe" behind the Joe V's Smart Shop name. An executive of Trader Joe's, attending the press conference, will shout: "Say it ain't so - Joe," over and over again, following Joe Villarreal's announcement.

Since the announcement is coming soon, we encourage the many food and grocery retailing experts and keen industry observers who read Fresh & Easy Buzz to chime in using the comments link below.

Which one of our predictions do you think is correct? None? What's your prediction?

H-E-B Tweaking Product Assortment at Joe V's Smart Shop Discount Grocery Store in Texas Opened May 5

Discount Format Food & Grocery Retailing

A mere two weeks after opening its first Joe V's Smart Shop discount grocery store in Houston, Texas on May 5, San Antonio, Texas-based grocery chain H-E-B this week is giving the new store's product assortment a bit of a tweaking, Fresh & Easy Buzz has learned.

The product assortment adjustment started on Wednesday (May 19), and is based on feedback and other inputs the grocer has gleaned over the two weeks Joe V's has been open, according to Joe Villarreal, the general manager of H-E-B's Joe V's Smart Shop division.

We aren't surprised family-owned H-E-B would be doing a product assortment adjustment only two weeks after the discount format grocery store opened. H-E-B is among the most fastidious and best retail grocery merchandisers in the U.S. It's a good - and smart - sign at the smart shop.

Additionally, since Joe V's Smart Shop is a new format for H-E-B, and it's first price-focused discount grocery format to boot, it makes good and logical sense in our analysis for the grocer to tweak the store's product assortment so early in the game, and continue doing so regularly.

Since Joe V's is a limited assortment discount format - the store carries about 9,000 SKUs -regular product assortment adjustment is even more important for H-E-B, or for any other grocery chain that operates a limited assortment format, because with a limited assortment a retailer has to obtain the maximum sales bang from far fewer SKUs than a typical supermarket carries. For example, the average U.S. supermarket, which averages 46,755 square-feet, carries 46,852 SKUs, according to the Food Marketing Insitute's research. FMI is the leading trade organization for the U.S. food and grocery retailing industry.

That H-E-B, which was founded 105-years ago and does $15 billion in annual sales in about 300 stores in Texas and Mexico, is adjusting the Joe's V's Smart Shop product assortment so early is a sign the grocer understands the importance of item optimization when it comes to operating a limited assortment discount grocery format.

Fresh & Easy Buzz has heard from a few readers who've visited the Joe V's Smart Shop store in Houston in the two weeks it's been open. All of the readers told us the store was extremely busy during their visits.

Big reusable grocery bag giveaway at Joe V's

H-E-B is also taking an aggressive approach with Joe V's. Smart Shop in the area of reusable shopping bags.

During the store's first eight opening weeks, which started on May 5, the grocer is giving each shopper who makes a single item qualifying purchase four free reusable grocery bags, according to general manager Joe Villarreal. (Here's an example of a qualifying item.) The purpose of this aggressive approach is to equip as many customers as possible with reusable bags at no charge, so they can bring the bags with them to the store on return trips, thereby dramatically reducing the amount of single-use plastic carrier bags Joe V's uses on an ongoing basis.

H-E-B's Joe V's smart shop division initially considered not offering single-use plastic carrier bags at the store at all, according to Joe Villarreal. However, it later decided to offer them, but to give out the reusable bags for free as a way to encourage regular use of the bags by customers.

The free reusable bag promotion also fits into what is a key promotional feature at H-E-B's Joe V's Smart Shop, which is what the grocer calls its FREEBIE! And the tagline is: "There's always something free at Joe V's."

And yes, Jose Villarreal, or Joe which he uses in e-mail correspondence, is the person and name, at least inspirationally, behind the Joe V's Smart Shop format and store name, although neither H-E-B or Mr. Villarreal has stated Joe V's Smart Shop is directly named after its general manager, Joe Villarreal.

Related stories from Fresh & Easy Buzz:

May 5, 2010: H-E-B Opens Joe V's Smart Shop Discount Prototype Grocery Store in Houston TX ... But Where's Joe?

May 6, 2010: Say it Ain't So Joe: Trader Joe's Tells H-E-B's Joe V's Smart Shop to Change its Name