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Hy-Vee announces burger restaurant rollout, fitness partnership

Grocer to become largest Wahlburgers franchisee, open OrangeTheory centers as it seeks "new ways to strengthen company."

In a move officials said would address changing consumer shopping and eating habits, supermarket operator Hy-Vee said Wednesday it would build, own and operate 26 Wahlburgers restaurants, becoming the largest franchisee of the casual burger chain associated with actor Mark Wahlburg.

The West Des Moines, Iowa, retailer also on Wednesday announced a separate partnership with OrangeTheory Fitness that would provide customers with access to group fitness programs in or adjacent to Hy-Vee stores.

“These unprecedented collaborations reinforce our company’s longstanding commitment to health and wellness, culinary expertise and customer experience,” Randy Edeker, Hy-Vee’s chairman, president and CEO, said in a statement. “However, they also represent a bold step to deliberately evolve our business to meet the change in our customers’ lifestyles and spending habits. These partnerships keep us on the leading edge as the retail grocery industry evolves.”

Hy-Vee cited Bureau of Labor Statistics figures illustrating that spending on meals outside the home surpassed that spent on meals at home last year. Millennials have played a significant role in the evolution, spending 44% of their food dollars annually on eating out, according to the Food Institute’s analysis of the USDA food expenditure data from 2014. That increase has skyrocketed income spent in restaurants and on take-out meals, rising from 34% in 1974 to 50% in 2014.

“There is a changing landscape in the retail industry,” Edeker said. “Hy-Vee has a responsibility to our customers, employees and communities to look for new ways to strengthen our company. With this type of progressive action, Hy-Vee is well positioned for future growth.”

Wahlburgers is a family-friendly restaurant that offers a unique dining experience featuring signature burgers and drinks in a casual environment. Currently, Wahlburgers operates 17 locations in nine states.

Hy-Vee said it would build, own and operate 26 Wahlburgers locations in seven Midwestern states, becoming the brand’s largest single franchisee and would open its first location next year in West Des Moines. In addition, Hy-Vee said it would add Wahlburgers-branded menu items to all 84 of its Market Grille in-store restaurants. Hy-Vee said Wahlburgers restaurants would “complement” Hy-Vee’s Market Grille restaurants, and tie into to the organization’s commitment to providing culinary expertise and experiences.

“I would personally like to welcome Hy-Vee to the Wahlburgers family,” Paul Wahlberg, chef and co-founder of Wahlburgers, said in a statement. “It’s a great honor to be able to partner up with a company that has a long and successful history in the two areas that are very important to Wahlburgers, quality and customer service.”

OrangeTheory Expansion in Store

Orangetheory Fitness is a revolutionary fitness program offering a one-of-a-kind, intensive group training workout, with 750 studios nationwide, and plans for 1,500 in the next two years.

Hy-Vee said it would partner with Orangetheory to offer customers a fitness experience in or adjacent to Hy-Vee stores. In addition, Hy-Vee dietitians will work with Orangetheory members to offer dietetic services, provide samples of nutritional products and lead store tours to showcase items that align with member needs. This partnership creates an integrated fitness component to bolster Hy-Vee’s focus on health and wellness — including in-store dietitians, HealthMarkets, chefs, fresh and organic produce and pharmacies.

The first Hy-Vee Orangetheory Fitness location will open in 2017 in the Twin Cities.

“Orangetheory is a revolutionary fitness experience, which combined with Hy-Vee’s health offerings, creates a one-stop shop for wellness,” Kevin Keith, Orangetheory Fitness’ chief brand officer, said. “Like our members, we know that many Hy-Vee customers are looking for more convenient ways to access fitness and healthy eating options in one location — this partnership solves that need.”

Hy-Vee operates 240 supermarkets in eight Midwestern states. With $9.8 billion in annual sales it was the 24th largest North American food retailer by volume in 2016, according to SN’s Top 75.

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