Wednesday, April 18, 2012

Mother and Daughter Entrepreneurs Build A Health Food Chain


     Mother and Daughter Entrepreneurs Build A Health Food Chain

Green Acres in Wichita Kansas

     As Barbara Hoffmann likes to say, her vision for Green Acres, a small Midwestern chain of organic and natural food stores, grew out of her aching back. Born into an entrepreneurial family who started a wholesale plant business, Barbara first  transformed her family business into  an interior landscaping business, Tropical Designs, providing plants and trees for offices and shopping malls. But after years of heavy lifting of plants,  Barbara developed chronic back pain and underwent several surgeries which didn’t solve her problems.  Finally, she took matters into her own hands and began to find relief in alternative treatments, diet changes, and nutritional supplements. The deeper she waded into the growing area of healthy eating and therapeutic supplements, she realized she had stumbled onto a concept—building better health—that she wanted to convert into a business.  
 
     After purchasing land that had been a horse farm, Barbara Hoffmann built and opened her first retail outlet, called Green Acres in 1994, offering mainly several brands of vitamins and supplements along with a few grocery staples. It is located in an upscale area of Wichita, Kansas into what has turned into  Bradley Fair, a “lifestyle” shopping mall which features a park like setting with  walking paths, monuments, and  lakes so that customers can feed birds or attend concerts before or after shopping or patronizing the restaurants. For many years she maintained a showroom for Tropical Designs, which has grown into the biggest interior landscaping business in the region with some 400 clients. But when Green Acres expanded for the second time as few years ago to its present footprint of 12,500 square feet, f she moved the plant design business to another location.
     Green Acres is now a medium sized organic and all natural foods store that not only sells products but teaches customers how their products  lead to better health, based on Barbara’s conviction that “food is our  best medicine.” Originally the store served as an alternative to weekly grocery shopping at the large supermarket chain, the highest grossing food store in the area, right across the street.  But overtime Green Acres has become a shopping destination as I expanded  its product mix with a lot of specialty foods, a deli  and baked goods—about 10,000 SKUs, always sticking to its store mantra of no refined sugars, pesticides, chemical preservatives, or hydrogenated oils. The vitamin and supplement business, which  now includes a house Green Acres brand, also continues to grow, currently accounting for about  one-third of revenues.
    
Barbara and Shannon Hoffmann

        Joining Barbara in the business six years ago was her daughter Shannon who  says she first learned to become an entrepreneur “at age 4, because my mom’s business and passion affected every part of our lives so I never saw any boundaries between work and home.” 
But nonetheless Shannon didn’t take a straight path into the family business.  After picking up a degree in Entrepreneurial Management at Wharton, Shannon  moved to California to take some acting classes and soon was recruited as a sales person for natural products trade shows; later on she  started a sales division for a supplements company, “giving me a great background in the supply side of the business.”
     When Shannon eventually returned to Kansas, her mother seized on her daughter’s secret ambition to become an actress by creating and producing a radio show about health to showcase the Green Acres commitment to natural foods-- and to entice customers into the store. For six years, Shannon, along with Matt Murray, a store manager and partner, hosted Health Talk with Matt and Shannon.    Syndicated nationally to 50 stations, the show brought in acclaimed authors and manufacturers in the health and natural foods area and helped spread the Green Acres philosophy.
Shannon Checks in Kansas City store
    Once the radio program ended, Shannon felt ready to open a new  link in the Green Acres chain in Kansas City in 2006—just as the economic slowdown began.  Shannon says opening the store, located in Briarcliff Village in the upscale Northland area of Kansas City, as the  economic slowdown began  was “a humbling experience,” which tested her commitment to the Green Acres model.  But she perservered as she adapted to slightly different customer demands for specialty foods. Since 2009  her store has operationally shown a profit, though  she continued to pay off bank loans which financed her opening; today the store is profitable with revenues currently up 12%,  anticipated to reach $3.5 million in 2012.  The larger Green Acres store in Wichita is up 20% for the last three years (despite the expansion) and expects revenues of $5 million this year.
       With the rise of some much larger competitors, Barbara Hoffmann attributes the success of the Green Acres stores to its basic product integrity along with its heavy emphasis on customer education and community outreach.  Both Green Acres stores  host regular product demos and cooking classes. Barbara says the Wichita store  produces 8 large events a year, provides live music on weekends, and a farmer’s market every Saturday. Whenever it invites  well known figures in medicine or nutrition, Green Acres  rents space in a nearby  hotel to accommodate the hundreds of customers who show up.  For an upcoming 18th anniversary celebration Barbara estimates they will have 1000 people come through the store—in a metropolitan community of just over 600,000!.
     Within a few months, Green Acres in Wichita will face competition from a new vitamin store and a Fres