Ira Higdon: Still in Growth Mode After 100 Years

CAIRO, Ga. — Ira Higdon Grocery Co. here saw sales rise about 15% in 2008, its 99th year in business. As the wholesaler marks its 100th anniversary this year, it anticipates additional increases, Larry Higdon, grandson of the founder and chairman, president and chief executive officer, told SN. Volume was up last year, he said, because a lot of customers picked up additional business as consumers began

CAIRO, Ga. — Ira Higdon Grocery Co. here saw sales rise about 15% in 2008, its 99th year in business.

As the wholesaler marks its 100th anniversary this year, it anticipates additional increases, Larry Higdon, grandson of the founder and chairman, president and chief executive officer, told SN.

Volume was up last year, he said, “because a lot of customers picked up additional business as consumers began eating out less and going back to cooking at home more. And given the current state of the economy, it's likely to get rougher for consumers, so we anticipate continued sales increases this year.”

Higdon also picked up some new customers from other wholesalers, “though that's a very slow process,” he acknowledged.

The wholesaler services about 140 retail stores in southern Georgia, southeastern Alabama and northern Florida, with some customers as far south as Orlando, Fla. While Higdon was reluctant to pinpoint the company's volume, industry sources estimate it at $200 million a year.

Of its 140 customers, 90 are superettes of 5,000 to 10,000 square feet, and 50 are supermarkets ranging up to 30,000 square feet, including 30 IGA stores.

Higdon said the company is happy to be doing business with smaller retailers.

“We don't quit customers because they're too small,” he told SN. “The fee structure may be different based on their size, but we don't ever quit anyone, because they're the ones who have kept us here for 100 years.”

By servicing stores of 30,000 square feet and smaller, the wholesaler is able to meet their needs on a cost-efficient basis, Higdon said.

“In order to serve larger stores, we'd have to add so much inventory to our mix that it would make us less profitable,” he explained. “And because we are running so efficiently, we can be as price-competitive as any of the larger wholesalers.”

Higdon said the company operates at service levels of 97%-plus.

Asked why retailers should buy from Higdon rather than from the wholesale companies it competes with — Supervalu, Nash Finch, Associated Grocers of Florida, Piggly Wiggly Southern or Associated Grocers of the South — Higdon told SN, “Because we have the ability to react swiftly to any situation, and we also provide the best service. We can react swiftly because the chain of command is not very long, and we can make a move within a day, if not sooner.

“And when we say we'll do something, we do it, which is part of a trust factor we have with our customers.”

Trust has been a key that's kept the wholesaler in business for 100 years, Higdon pointed out. “We treat customers and employees like they're part of our family, and many of them would rather be with a family business than a big corporation.

“We're very much like they are, and we can relate to each other better because we're all family. I can talk directly to them, and the owners can talk to me directly if they want to.

“And we have retail counselors who spend time with them at their stores, and they're good at keeping our customers happy.

“We've been here a long time, and the retailers like that continuity. Things don't change too quickly, and people like it that way. It gives customers a sense of trust with us, and we have trust in them.

“In fact, though it's one of those intangibles, that's probably the secret to our ability to have lasted for 100 years — it all boils down to trust between us and our customers.”

It's also become a bit easier to attract new business, he added, “as some wholesalers have gotten so big that they can't really give their customers personal attention, particularly as they've cut back on retail counselors.”

Higdon employs five grocery counselors and three meat counselors, who visit larger stores at least once a week and visit all customers at least once every three months.

“It's best to communicate with the retailers at their stores because when problems arise and the counselor is there, he can see the whole picture and resolve a small issue before it becomes a big problem,” Higdon pointed out. “And because they know what's going on at competing retailers' stores, the counselors are able to help our customers build their businesses — and as they grow, we grow.”

According to Higdon, being an IGA licensee since 1961 has been very important for his company “because it gives us a national brand name and the Hometown Proud theme. And because there's been such an influx of people from up north to Georgia and parts of Florida since the 1960s, many of whom know the IGA name, it gives our retail customers a national identity.

“In addition, although we compete with Supervalu, Nash Finch and Associated Grocers of Florida, all of them are IGA licensees as well, which is probably good for us because it keeps the IGA name out there.”

Ira Higdon Grocery Co. operates out of a distribution center of 182,000 square feet in Cairo that includes a new freezer added last year.

Larry Higdon estimated the company could grow “another 25% of what we have” before the warehouse would begin to approach full capacity.

It's a full-service facility for dry groceries, frozen food, dairy, meat and deli; the company cross-docks health and beauty care items from a third-party distributor and contracts with other companies to deliver produce and baked goods to the stores.

Asked whether he ever feels slighted by vendors who might pay more attention to larger customers, Higdon said he does not. “Suppliers really work well with us, and we try to respond in like fashion,” he explained. “It goes back to that family relationship — we treat them well, and they try to treat us just as well.”

Though he acknowledged he's gotten calls about selling the company over the years, “they're calling less often at this point,” Higdon said. “We never did entertain any offers on a serious basis, and we gave them very little encouragement to call back.”

Fourth-Generation Wholesaler

Ira Higdon Grocery Co. has defied the odds in reaching the age of 100.

The company, based in Cairo, Ga., was founded in 1909 by Ira Higdon, a traveling salesman for a grocery company who decided to go into business for himself, selling and delivering groceries.

His son, Ira Higdon Jr., joined the family business in 1935; and Ira Jr.'s son, Larry Higdon, came on board in1972. When Larry's son Nat Higdon joined the company in 1998, there wasa four-year period when the latter three generations worked together before the son of the founder retired in 2002. He died that same year.

There is a fifth generation, “but they're just babies right now,” Larry Higdon, chairman, president and chief executive officer, pointed out.

Asked how he feels about the company's accomplishment in reaching 100 years, Higdon told SN, “Obviously, it feels great. It's like we started something good and we've continued to get better and continued to grow.

“Looking at some of our long-term customers, it feels like we've been raising a family, and we want to keep going that way.”

Competitors that it has outlasted include Scrivner, Certified Grocers of Florida, Affiliated Grocers of Florida and RIO, a former wholesaler based in Albany, Ga.

Higdon has been servicing customers in Georgia for all of its history; it expanded into Alabama and the Florida Panhandle about seven years ago, after Fleming Cos. went out of business, which left retailers scrambling for new sources of supply.

Most of its customers are rural, operating outside large cities, though it does service retail accounts in Jacksonville Beach, Fla., and some smaller towns in the Tampa area.

Higdon said he believes the retailer who has been a Higdon customer the longest is Spires IGA, with stores in Lake Butler, Lake City and Baldwin, Fla., who became a customer almost 50years ago.