Speed’s Apple Market is a new start-up grocery store that opened in late March 2009. The store services an area approximately 25 – 35 miles in all directions from its location in Ord, Nebraska.
The company’s owners worked with Nebraska Business Development Center at the University of Nebraska at Kearney to prepare a business plan, financial pro forma statements and two completed loan packages to fund the project. NBDC also provided GIS data and premium industry research to support the choice of the store’s location and underlying sales projections.
The company received a SBA 504/bank loan in the amount of $1,104,000 from NEDCO. The State Bank of Scotia also funded inventory working capital of $254,000 using the SBA 7a program. The owners provided $304,000 in equity for the project. The total value of the project was $1,662,000 in total assets. When the market value of the appraised real property is added, the total value of the project exceeded $1,870,000. Revenue is expected to surpass $3.7 million during the first year of operations, with sales conservatively projected at $5.08 per square foot of retail space.
The ownership and management team include Craig Vogeler of North Loup, Nebraska and Larry Waller of Gretna Nebraska. The team brought an impressive resume of business ownership and management to the project - as well as significant experience in the retail and grocery industry, principally through the nation’s leader, Wal-Market. The owners have experience in grocery sales, retailing, manufacturing and business management.
The team sought to develop their business in a rural market that they believed to be underserved by smaller, limited grocers. They selected Ord, Nebraska, the leading community in the market region and population center. Speed’s Apple Market is significantly larger then all existing competitors allowing it to offer a greater selection of products and services. The store has a full deli, provides an alcoholic beverages section and a large selection of fresh fruits, vegetables and meats. Locating the new store in a renovated building allowed the owners an opportunity to enter the market at a significant savings compared to the cost of new construction, yet interiors are spacious and have a new appearance that has resulted in positive customer reaction and word of mouth referrals.
This geographical area also saw significant leakage from their local and regional economy to larger communities where brand name stores or big box outlets were present. Area residents routinely would drive up to 80 miles out of the region to North Platte, Kearney, Lexington or Grand Island to shop at Wal-Mart, Sam’s Club or other providers with grocery and food components. The company’s ability to take market share from existing competitors as well as retain additional sales formerly leaking out of the immediate region are keys to the company’s long-term success. In addition to retaining sales in the region and the local tax benefits such sales represent for the community, the company has created 26 new full-time and part-time jobs.
Mr. Waller has spent 19 years either training and managing three different Wal-Mart retail and grocery stores. He was promoted to a District Manager position in 2001, and by the time he left Wal-Mart, he was responsible for a total of 17 individual stores. The experience Mr. Waller had in the Wal-Mart model of marketing and retailing has brought a clear operational advantage to the Apple Market venture over other regional competition. The other co-owner, Craig Vogeler is an experienced business owner, manufacturer and entrepreneur. Mr. Vogeler acts as company’s President and CEO.
First-year sales are expected to exceed $3.7 million for FY1 and surpass $4.0 million in FY2. The owners are already searching for additional rural locations to launch similar stores, providing increased employment and a wider selection of goods and services for area residents – without the need to travel an hour in each direction.