COPPELL, Texas -- Ron Johnson has walked most of Minyard's stores, and he likes what he sees, he told SN last week.
The managing partner of the Texas-based investor group that acquired Minyard Food Stores here 10 days ago said an influx of capital spending should help improve the chain's prospects in the tough Dallas-Fort Worth marketplace.
"I've walked 42 of the company's 69 stores," Johnson said, "and I thought they were well-stocked and did a good job taking care of customers. But I also recognized there was some deferred maintenance at those facilities, and I believe that, if we can put some money into remodeling and refurbishing, there can be a true upside.
"We're just starting the process of looking at that, and we expect to be able to be more specific about how much we will spend sometime after Jan. 1."
The chain was sold by the Minyard family late last month to Acquisition Vehicle Texas II (Minyard Group), a Texas-based investment group headed by Johnson, who formerly ran Jitney Jungle Stores of America, Farm Fresh and Kash 'n Karry Food Stores. Terms of the transaction were not disclosed.
Johnson, 54, has assumed responsibility for day-to-day operations at Minyard's, although he is barred by Texas law from holding a title with the company for at least a year, he told SN.
He will operate the company as managing partner, president and chief executive officer of Minyard Group, the acquiring entity, "and at some point I will assume a title at Minyard Food Stores, but I can't hold the title of president of a Texas company without being a resident of the state for a year," he told SN.
Johnson said he's in the process of moving from Tampa, Fla., to the Dallas-Fort Worth area.
Under its new ownership, the company will continue to operate under its existing banners, he noted: Minyard Food Stores on 26 conventional stores; Carnival Food Stores on 24 Hispanic-oriented urban locations; Sack 'n Save Warehouse Food Stores on 19 price-impact units; and On the Go at 15 fuel stations.
Corporate sales are just under $1 billion, Johnson said, and he said he sees opportunities to increase that number. "Once we start the remodeling process and clearly define our focus on who our customers are, I believe we can improve same-store sales significantly," he said, though he declined to pinpoint what sort of increases he anticipates.
"The company has been on the right track in terms of its focus, and it's done a tremendous job serving customers in Hispanic markets with its Carnival stores. Minyard's is doing some really exciting things in those stores, and while I'm not going to say that's the future of Minyard's, I will say we will be really focused on those stores in the short term, and maybe even in the longer term."
Johnson said he sees potential to open additional Carnival stores, including building new units and possibly converting some existing stores to that format.
He said the stores operating under the Minyard Food Stores and Sack 'n Save banners are also doing "quite well in the way they service customers, and over the next three months we'll clearly define how we'll position those stores going forward. But we will certainly continue to operate both formats along with Carnival and look for growth opportunities to expand those formats."
He said he does not anticipate bringing in new executives, telling SN it has been his practice to work with existing personnel at each company he has headed. "I try to figure out how to work with the experience and talent that is already in the organization, and that's where I plan to start from here at Minyard's," he pointed out.
Johnson told SN he's not fazed by the competitive nature of the Dallas marketplace. "Having operated against a lot of top companies in Tampa, Fla., when I ran Kash 'n Karry; in Hampton Roads (in Virginia) when I ran Farm Fresh, and in Jackson, Miss., when I ran Jitney Jungle, it can't be any more competitive than what I've experienced.
"However, I certainly recognize this is a very competitive market and we have to clearly define our niche, and we intend to do that by doing analytic research and demographic studies over the next several months," he said.
Johnson told SN he has been "playing golf" in Tampa since 2001, when he oversaw the liquidation of Jitney Jungle.
He had no intentions of getting back into the food industry, he said, before he got a call from an investment banker friend in New York, who had been contacted by a member of the investment group that ultimately acquired Minyard Food Stores asking if the banker knew anyone who could help evaluate the chain. He recommended the group contact Johnson.
"At first I thought I would help them out and that would be the end of it," Johnson recalled. "But once I got to walking the stores, my heart started pumping a little bit faster than normal and I realized I still had a passion for this business.
"As I got to know the people in this organization and they got to know me, it became logical to discuss with the investors whether we could work out something where I could run the company. I've been told they talked with other executives, but eventually they chose me."
Johnson declined to pinpoint any members of the investment group "because they like to keep a low profile." However, he said he has become one of the investors.
Minyard's has been a family-owned business since its founding in 1932 by M.T. "Buddy" Minyard. Since his death in 1988, the company has been run by his daughters, Liz Minyard, 50, and Gretchen Minyard Williams, 48, who held the titles of co-chairs and co-CEOs prior to the sale.
Liz Minyard said she will remain with the company through June as vice chairman. Gretchen Minyard Williams and J.L. "Sonny" Williams, her husband and Minyard's president, will leave the company at the end of the year, Johnson said.
Allowing Liz Minyard to stay on as vice chairman through June will enable her to serve out her second term as chairwoman of Food Marketing Institute, Washington. Her term expires in May.
"That was one of my considerations for staying on till June," Liz Minyard told SN. "I didn't want to have to resign [from FMI] in the middle of my term, and we need to have a transition at the company."
Minyard said the family decided to sell the chain "because we felt the timing was right."
The company has had numerous offers to sell over the years, she said, "but there were a lot of different reasons why the timing was right this time."
"Some reasons are private, involving some health issues, but when you look at the environment in retailing today, the family felt it needed to do something now," she said.
"This is a very tough time to be operating, very challenging. The Dallas-Fort Worth market has all the major players competing, and it had just become a matter of time [before the family would opt to sell]."
Accordingly, the Minyard family hired Houlihan Lokey Howard & Zukin to represent it in finding a buyer, she said. "We made the decision to sell and to see what kind of interest there was and who would make the best offer," Minyard told SN.
She said the company did not have any guidelines for the kind of buyer it was hoping to find. "It was just part of a negotiating process," she explained.
Minyard declined to pinpoint how many companies had expressed an interest in buying the business but said, in response to an SN question, that no chains had come forward.
Asked how she felt about selling, Minyard told SN, "There's always a sort of bittersweet feeling in this sort of transaction. The family has owned this business for 72 years.
"Fortunately, I'm being allowed to stay on for several months, so that will give me more time to make the adjustment."
Asked how she plans to spend the time after she leaves the company, Minyard replied, "Enjoying life."
