December 5, 2007
Tops CEO Takes a Local Approach to Growth
Now that Morgan Stanley Private Equity has closed its deal to acquire the Tops Markets chain from Ahold, the question becomes, “What’s next?”
Frank Curci, the former and new CEO of Tops, told The Buffalo News that the company plans to refocus on local needs, add corporate staff, remodel existing stores and increase the number of new locations by more than 10 percent over the next five years.
According to Mr. Curci, Tops suffered in recent years after Ahold moved management of the chain to Giant Carlisle’s headquarters. “If we had one weakness in the past couple of years, it was in the centralized organization’s lack of focus on individual customers,” he said.
To get up-and-running, Tops plans to add about 100 people in finance, information technology, marketing and merchandising to its corporate headquarters.
“Those are the functions that will best enable us to serve our customers better,” he said.
Frank DeRiso, president of the United Food & Commercial Workers union Local 1, said he was happy to see Mr. Curci back leading Tops.
“He has previous experience with the Tops organization; he knows Buffalo; and without Ahold, he will be able to use his knowledge and expertise to bring the local flavor back to Tops,” Mr. DeRiso said in a statement.
Discussion Question: What do you expect from Tops Markets under Frank Curci’s leadership and Morgan Stanley’s ownership? How much of a lift will Tops get from moving its corporate operation back to the Buffalo region?
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A local company needs to have its management local. This move should help Tops reconnect with their customers. It should make them more nimble and able to address local needs.
Bigger is not always better.
Morgan Stanley has some big issues to work through these days. Let’s see what they allow Tops management to do.
Frank is right about the move BUT moving closer to the market gives you the potential to better communicate with the community you serve. As to the future–the devil is in the details. Opening more stores isn’t necessarily the right answer. It’s having the right kind of stores open. Given Top’s weakness, I’d be very careful not to just blanket the market with new “me too” units or open more stores in the face of uncertain consumer demand.
Senior level management’s focus on local customers is a great start. Listening to shoppers and creating sustained dialog will also support shoppers getting reinvested in being part of the solution. Let’s not forget how much consumers want and reward brands who give them a voice.
The issue is really speed. How fast can they move to reformat stores to deliver a shopping experience that will change shopping trip behavior and purchase patterns? Hard to do in a declining economic environment, but I wish them well.
What can they learn from Tesco’s success on the other coast and apply to the real estate they control in their geography?
Sounds like a lot of bold talk. I expect store closures and layoffs. If Ahold, one of the the largest grocers in the world couldn’t make them work, what makes Morgan Stanley think they can do it? Wegmans and Wal-Mart, two of the worlds most premiere supermarket operators, will just keep growing. That means someone has to shrink. Anytime there is a new acquisition, the new owners talk about cap-ex, new stores, new strategy, hiring more people. Don’t get me wrong, Morgan Stanley just might make a killing on the financial end, but it won’t be through new stores, increased sales and market share.
Frank DeRiso, of Local 1 UFCW, could really help Frank Curci of Tops, if he’d organize some nonunion grocers in the Buffalo area. Asking Tops to compete against nonunion supermarkets is the hardest challenge imaginable. And Frank Curci could help Frank DeRiso by offering a significant bonus to his union staff if they organize any nonunion competition successfully. The 2 Franks need to unite against their common enemy. Otherwise, neither organization will achieve its optimal goals.
In the last year, Tops has lost another share point. Little or no store investment and a workforce wondering what will happen to them – I suspect more time was wasted talking about what will happen then getting the job done. Just moving headquarters operations to Buffalo will not make consumers want to shop the store.
A retailer must be involved in the community to have a soft impact. Unless the new merchants bring in the local brands consumers want, there will be no change. This is assuming the local brands have not lost their consumer pull. Now the market is split between Tops and Wegmans, with Wal-Mart and Aldi growing. Consumers will need more than just a local headquarters to shop at Tops.
Frank is the right person to bring together the Tops management to get the job done. He only needs to get rid of the “Old Boys Club” mentality in upper management. I am sure Frank has been evaluating the management. Tops has some great people working for them and needs to capitalize on that.
It will also depend on how much money they are willing invest to get a return. I really hope they turn it around.
I have known Mr Curci from his years at various Ahold Divisions, and he is a very dynamic person and very knowledgeable about his markets. He knows what it will take to turn Tops around and hopefully Morgan Stanley will give him the latitude to get it done. I will tell the readers the one big difference between Tops today and of its indentured servitude under AHOLD is that Frank is a leader. People WANT to work for him, not HAVE to work with him. If anyone can turn it around, it’s Frank.
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A local company needs to have its management local. This move should help Tops reconnect with their customers. It should make them more nimble and able to address local needs.
Bigger is not always better.
Morgan Stanley has some big issues to work through these days. Let’s see what they allow Tops management to do.
Frank is right about the move BUT moving closer to the market gives you the potential to better communicate with the community you serve. As to the future–the devil is in the details. Opening more stores isn’t necessarily the right answer. It’s having the right kind of stores open. Given Top’s weakness, I’d be very careful not to just blanket the market with new “me too” units or open more stores in the face of uncertain consumer demand.
Senior level management’s focus on local customers is a great start. Listening to shoppers and creating sustained dialog will also support shoppers getting reinvested in being part of the solution. Let’s not forget how much consumers want and reward brands who give them a voice.
The issue is really speed. How fast can they move to reformat stores to deliver a shopping experience that will change shopping trip behavior and purchase patterns? Hard to do in a declining economic environment, but I wish them well.
What can they learn from Tesco’s success on the other coast and apply to the real estate they control in their geography?
Sounds like a lot of bold talk. I expect store closures and layoffs. If Ahold, one of the the largest grocers in the world couldn’t make them work, what makes Morgan Stanley think they can do it? Wegmans and Wal-Mart, two of the worlds most premiere supermarket operators, will just keep growing. That means someone has to shrink. Anytime there is a new acquisition, the new owners talk about cap-ex, new stores, new strategy, hiring more people. Don’t get me wrong, Morgan Stanley just might make a killing on the financial end, but it won’t be through new stores, increased sales and market share.
Frank DeRiso, of Local 1 UFCW, could really help Frank Curci of Tops, if he’d organize some nonunion grocers in the Buffalo area. Asking Tops to compete against nonunion supermarkets is the hardest challenge imaginable. And Frank Curci could help Frank DeRiso by offering a significant bonus to his union staff if they organize any nonunion competition successfully. The 2 Franks need to unite against their common enemy. Otherwise, neither organization will achieve its optimal goals.
In the last year, Tops has lost another share point. Little or no store investment and a workforce wondering what will happen to them – I suspect more time was wasted talking about what will happen then getting the job done. Just moving headquarters operations to Buffalo will not make consumers want to shop the store.
A retailer must be involved in the community to have a soft impact. Unless the new merchants bring in the local brands consumers want, there will be no change. This is assuming the local brands have not lost their consumer pull. Now the market is split between Tops and Wegmans, with Wal-Mart and Aldi growing. Consumers will need more than just a local headquarters to shop at Tops.
Frank is the right person to bring together the Tops management to get the job done. He only needs to get rid of the “Old Boys Club” mentality in upper management. I am sure Frank has been evaluating the management. Tops has some great people working for them and needs to capitalize on that.
It will also depend on how much money they are willing invest to get a return. I really hope they turn it around.
I have known Mr Curci from his years at various Ahold Divisions, and he is a very dynamic person and very knowledgeable about his markets. He knows what it will take to turn Tops around and hopefully Morgan Stanley will give him the latitude to get it done. I will tell the readers the one big difference between Tops today and of its indentured servitude under AHOLD is that Frank is a leader. People WANT to work for him, not HAVE to work with him. If anyone can turn it around, it’s Frank.