The Surprisingly Resilient History of IGA, Which Gave Small Towns Groceries

You’ve probably been to one.

by Ernie Smith July 11, 2016

An old sign for an IGA in Knoxville, Tennessee. (Photo: Joel Kramer/CC BY 2.0)

A version of this post originally appeared on Tedium, a twice-weekly newsletter that hunts for the end of the long tail.

While I don’t hold the simple, evocative opinions of small-town life that John Mellencamp does—I think large cities are pretty cool, and I’m not sure where I’ll die yet—I do appreciate the fact that they exist.

But let’s be clear: In terms of supplying a good diversity of local businesses, they’re at a sheer disadvantage compared to large cities. As a result of this, good luck finding a vegan bakery in a small town. The proliferation of Walmart, of course, hasn’t really helped.

But for roughly 90 years or so, a loose network of franchised grocery stores has—and hundreds of mom-and-pop supermarkets of the world have been able to hold their own even in the face of massive competition. The Independent Grocers Alliance, or IGA, is a common sight in small towns around the country, even today—and that’s a good thing.

Not that it gets the credit it deserves.

While it may be easy to find stacks of books and articles written about Walmart founder Sam Walton, you won’t find a single mention of IGA founder J. Frank Grimes on many business sites, despite the fact that Grimes did something arguably more impressive: He made it possible for small-town grocers to remain competitive in their given market without losing their homespun identity.

While IGA, founded 1926, was a somewhat early example of the franchise model, it differed in an important way: Instead of trying to set up the ramifications for how these local businesses should be run—say, specific building designs, like you might run into at a McDonald’s—it instead offered different kinds of help to those retailers. That help, traditionally, has come in the form of marketing and access to a consistent supply chain. After a few years, the company even began making its own canned foods.

And though IGA helped its members, when it came down to it, the owner of the store was still the guy in the stockroom, writing reports and cutting the checks.

The interior of a Seattle IGA store, 1956. (Photo: Seattle Municipal Archives/CC BY 2.0)

And it was Grimes, who—it should be said, was very much the opposite of his Simpsons counterpart—in large part facilitated helping family businesses to stay alive. In 1929, in the wake of the Great Depression, he spoke about how family businesses were well-suited to hold their own during an economic crisis.

“Great businesses are drawing in and becoming fearful, and adding to the unrest and unemployment,” Grimes said, according to Supermarket News. “Right at this time, the opportunity is golden for men to go out and do business courageously, with determination, and prove that America is not dead yet. That there are men thinking and unafraid.”

Grimes’ evocative talk certainly helped, and small stores quickly flocked to the concept. The collective gave consumers a brand name that they could recognize no matter where they traveled, and made it easier for grocery stores to market themselves in newspapers and on television.

This worked well for IGA, which grew quickly, convincing thousands of independent supermarkets to join the alliance. In a 1986 article on the company in the Chicago Tribune, then-IGA president William Olsen spoke about IGA’s philosophy when asked how the firm would tackle superstores.

“We have to deal from our strengths,” Olsen said. “We have the owner in the store. We are flexible enough to serve the consumer. Good service, clean stores, and a competitive value are our strengths.”

It’s a different line in the sand to take from “always low prices,” but it’s a welcome road for a retailer to take.

In 1966, on the company’s 40th anniversary, then-Senate Majority Leader Mike Mansfield (D-MT) gave the company a round of praise on the Senate floor.

“This organization has helped independent grocers in 46 states to increase their sales and modernize their stores,” Mansfield said. “IGA has become the world’s largest voluntary foodstore chain. It has given its members the same tools as those of their larger corporate competitors, and there are several markets where IGA independent grocers are the sales volume leaders.”

It’s no shoutout in the Harvard Business Review, but certainly a nice consolation prize.

With 90 years under its belt, IGA has a lot of history to pull from, and that legacy has taken IGA to some impressive places far beyond its hometown roots.

IGA currently has a presence in more than 30 countries. After longtime associate Thomas Haggai became CEO in the late ’80s, the company made an aggressive push into a number of other countries where the independent store concept translates.

The approach did particularly well in Australia, where IGA is one of the country’s largest grocery brands. (Haggai, by the way, became the company’s chairman emeritus earlier this year.)

IGA’s growth has even helped the brand expand into U.S. markets that play against its small-town Americana rep. For example, Guam: Back in 2009, an IGA store opened on the tiny Pacific island, population 165,124.

“Our residents are not only pleased at the fact that island fresh IGA is making every effort to offer retail goods at competitive prices, but they have offered to our residents competitive job opportunities in a struggling economy,” Chalan Pago-Ordot Mayor Jessy Gogue said in a newsletter article published by the North West Company.

(By the way, the North West Company has an interesting business model; the Canadian firm, which claims roots that date back to 1668, specifically focuses on underrepresented retail markets worldwide.)

But even within its traditional strongholds of the Lower 48 and Canada, you can still find a lot of interesting factoids about the company. Among them:

Paul Anka partly owes his career to IGA. The reliably square crooner and songwriter, looking to make his way to New York City, spent three months collecting Campbell’s soup labels in an effort to win a contest at his local IGA store. He won the contest, and the trip, and somehow leveraged that trip into a 60-year career.

An IGA Foottown in Tacoma, Washington, in 1955. (Photo: Ethan/CC BY 2.0)

IGA once attempted to sell crow in a can. Either completely unaware of crow’s status as a food one metaphorically eats when wrong, or banking on the fact that people frequently eat actual crow for that reason, IGA attempted to sell local stores on the idea of crow in a can at a 1937 conference, according to a New York Times brief from the era. Clearly, it worked, because we eat crow all the time these days.

One Wisconsin IGA store likes never-ending beer brats. In Prescott, Wisconsin, an IGA store is home to the world’s longest beer brat. Ptacek’s initially did this gimmick for its 100th anniversary, but kept it around after the gimmick garnered the store media attention.

IGA runs a training institute for its member grocers. The name of the institute is the best part: It’s called the IGA Coca Cola Institute, which makes one wonder what a university would look like if it was branded by a sugar-water manufacturer.

By merely sticking around, IGA clearly has pulled off something that might be impossible in other industries susceptible to similar upheaval.

You know, like newspapers. In an era when scale is paramount, making the model work for local rags can be a challenge in some markets.

Not everyone’s having such bad luck with community papers, though: Some of the smallest, it turns out, are doing OK when you tighten the microscope. An Editor and Publisher piece published last month noted that some tiny newspapers are doing well—the kind that publish in the types of towns where IGA makes its bread and butter, in fact.

Doug Caldwell, the publisher of the Petoskey-News Review in Petoskey, Michigan, notes that the paper holds its own in its community despite competition for readers’ time.

“Our readership recognizes the value of the local newspaper. We are the cheerleader, guardian and watchdog all rolled up in one,” Caldwell said. “We monitor the pulse of the community and focus on local news stories of interest—not what [newspaper editors] want but what our readers want in their community newspapers.”

“Hometown Proud”: an IGA in Akron, Ohio. (Photo: Nicholas Eckhart/CC BY 2.0)

This sort of earthy quality gets lost on most chain-newspaper websites, replaced by a robotic desire to send us content in the most efficient way possible. But like some small papers, IGA’s many stores have found their niche and serve their communities effectively, even to this day.

There are limits, of course, to even what IGA can do. In recent years, food deserts, or places where nutrition is hard to come by without leaving the area, have become a point of contention in many urban areas. Food deserts, however, also affect rural areas, an issue highlighted as far back as 2007 by the Rural Sociological Society.

A piece last year on the topic by Al Jazeera America highlighted the plight of one Nebraska resident who has to travel long distances just to fill his fridge.

“We have to drive 45 minutes to get it,” Roger Chilen noted, “You spend $20 on gas to go to the grocery store. And when you’re living on Social Security, you don’t go unless you have to.”

Chilen and his wife end up doing a lot of gardening and pickling of foods to help fill the gaps, but the situation is one where the demand far outpaces the supply—where people who want food have just a handful of places to go to get it.

Part of the problem is that the demographics of the area are unattractive to chains, who feel they won’t make enough money to make the endeavor worthwhile, so they disregard the market. Their best shot might be to win over an independent grocer willing to take a chance on them.

That’s where IGA, slogan “Hometown Proud,” might come in handy.

A version of this post originally appeared on Tedium, a twice-weekly newsletter that hunts for the end of the long tail.