Kroger

Our mission is to be a leader in the distribution and merchandising of food, health, personal care, and related consumable products and services. By achieving this objective, we will satisfy our responsibilities to shareowners, associates, customers, suppliers, and the communities we serve. In Cincinnati, Ohio, Bernard H. Kroger founds the Great Western Tea Company, one of the first chain store operations in the United States. With 40 stores and a factory in Cincinnati, the company incorporates as The Kroger Grocery and Baking Company. Company acquires Dillon Companies, Inc. and begins operating stores coast to coast; the Kwik Shop convenience store chain is also acquired. Kroger fends off hostile takeovers by awarding shareholders with a special dividend, pushing its debt load to $5.3 billion. Among companies that principally operate grocery stores, The Kroger Co. ranks first in the United States (discount retailer Wal-Mart Stores, Inc., through its supercenter outlets, is actually the leading seller of groceries in the country). Kroger runs more than 2,500 food stores in 32 states in the Midwest, South, Southwest, and West; these stores operate under about two dozen banners, including Kroger, Fred Meyer, Ralphs, Food 4 Less, Smith's, Fry's, Dillons, and King Soopers. More than 500 of the outlets include gasoline stations and nearly 1,900 feature pharmacies. Of Kroger's total sales, 95 percent is derived from these food retailing operations, with the remainder coming from the company's convenience stores, jewelry stores, and manufacturing facilities. Kroger operates nearly 800 convenience stores under six flags in 16 states, most of which also sell gasoline, and about 440 fine jewelry stores under the names Fred Meyer, Littman, Barclay, and Fox's. The company's 42 food processing facilities produce dairy products, bakery goods, deli items, and other grocery products. Kroger Co. historians characterize B.H. Kroger as somewhat of a "crank," fanatically insistent upon quality and service. Profanity was called his second language; he often advised his managers to "run the price down as far as you can go so the other fellow won't slice your throat." Part of Kroger's success came from the elimination of middlemen between the store and the customer. In 1901, Kroger's company became the first to bake its own bread for its stores, and in 1904, Kroger bought Nagel Meat Markets and Packing House and made Kroger grocery stores the first to include meat departments. This important innovation, however, was not easy. It was common practice at that time for butchers to short-weight and take sample cuts home with them, practices that did not coincide with B.H. Kroger's strict accounting policies. When Kroger installed cash registers in the meat departments, every one of them inexplicably broke. When Kroger hired female cashiers, the butchers opened all the windows to "freeze out" the women and then let loose with such obscene language that the women quit in a matter of days. When Kroger hired young men instead as cashiers, the butchers threatened them with physical force. But Kroger was stubborn, and in the long run his money-saving, efficient procedures won out. From the beginning, Kroger was interested in both manufacturing and retail. His mother's homemade sauerkraut and pickles sold well to the German immigrants in Cincinnati. In the back of his store, Kroger himself experimented to invent a "French brand" of coffee, which is still sold in Kroger stores. The Kroger Grocery and Baking Company soon began to expand outside of Cincinnati; by 1920, the chain had stores in Hamilton, Dayton, and Columbus, Ohio. In 1912, Kroger made his first long-distance expansion, buying 25 stores in St. Louis, Missouri. At a time when most chains hired trucks only as needed, Kroger bought a fleet of them, enabling him to move the company into Detroit; Indianapolis, Indiana; and Springfield and Toledo, Ohio. When the United States entered World War