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Earth Fare: All Over the Map

Today, Akron. Tomorrow, the world.

That could be the trajectory of Fletcher, N.C.-based natural and organic chain Earth Fare, after it was dealt from one private equity firm (Monitor Clipper) to another (Oak Hill Capital Partners) this week in a move the investors said would prepare the chain for its next phase of growth.

Now 25 stores strong and fresh off an expansion that saw the chain jump from its Southeast base up into Ohio for the first time, industry observers expect the deeper pockets of Oak Hill could allow Earth Fare to do more of the same, establishing a presence in small cities where existing natural and organic competition isn’t particularly intense and its relatively small footprint provides options in choosing the right sites.

“I think they will seek out sites in the B-plus, B-minus and C-plus markets, and find plenty of them,” Jay Jacobowitz, president of Retail Insights, a Brattleboro, Vt.-based consultant to the natural-products industry, told us. “They’re not trying Washington, D.C., San Francisco, Chicago or other high-density, high-income trade areas.”

Earth Fare has three new sites in the works, according to its website. A Columbus, Ohio store is set to open late this month, as part of the Polaris Centers of Commerce, a sprawling retail shopping hub where its neighbors will include Costco Wholesale and the ritzy Polaris Fashion Place mall. A new store is reportedly scheduled to open at the Riverchase Galleria in Hoover, Ala., a suburb of Birmingham, in July. That site is taking the place of a vacant Comp USA store.

Later this year, Earth Fare will make its Kentucky debut with a store at The Summit in Louisville, an upscale lifestyle center where it will be taking the place of a closed Gap store.

Earth Fare’s expansion resembles that of The Fresh Market which, like Earth Fare, grew from a North Carolina base to other Southern and Midwest cities with a similar-sized box. Fresh Market in fact will be a competitor in each of Earth Fare’s next three debut cities, although their positioning is quite different, sources say. Whereas The Fresh Market differentiates behind service and specialty offerings, Earth Fare builds its brand behind high ingredient standards appealing to dedicated natural/organic shoppers and those who’d like to be.

And we can’t rule out the longer-term impact of Whole Food Market’s aggressive goal of building 1,000 stores. The expansion will require the chain, with just over 300 stores currently, to seek out smaller markets as well. While the nation’s leading natural foods retailer says the strategy will take years to execute, there’s little doubt within the industry that the plan will eventually take it into the very same market areas being pioneered today by Earth Fare and The Fresh Market.

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