Stew Leonard Sr. created the 'Disneyland of Dairy Stores'

Stew Leonard Sr. broke out onto the national supermarket scene when he was sentenced to prison back in 1996 for tax fraud.

At a more regional level, however, he was the king of retail dairy. Leonard recently passed away at the age of 93 following a brief illness. Worried that his family’s milk delivery service was going to end up like the ice business, Leonard came up with the floor plan where children could watch milk being bottled while their parents did the grocery shopping in a farmer’s market atmosphere.

The first Stew Leonard’s store opened in December 1969 in Norwalk, Conn. … all 17,000 square feet of it. Just eight items were offered to customers, but before long Ripley’s Believe It or Not tagged the establishment as the world’s largest dairy store and the Guinness Book of World Records claimed it had the highest dollar sales per square foot of selling space.

Stew Leonard’s, however, is more than just titles for the loyal families who have and continue to shop there. The stores’ entertainment has expanded beyond the milk bottling process as you can now see costumed characters and animated entertainment in the aisles, which have led to another claim that the chain is the “Disneyland of Dairy Stores”. Etched in granite stone outside of each Stew Leonard’s is a motto Leonard had his staff follow daily: Rule No. 1, the customer is always right, and Rule No. 2 if the customer is ever wrong re-read Rule No. 1. Everything goes by the S.T.E.W concept: Satisfy the customer, Teamwork gets it done, Excellence makes it better and Wow makes it fun.

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“My family and I are sad to announce that our dad, Stew Leonard Sr., the founder of Stew Leonard’s, passed away peacefully on April 26,” the family said. “One of Stew’s favorite things to do throughout his life was to stand at the front door of Stew’s greeting you, the customers.”

There are now seven Stew Leonard’s across Connecticut, New Jersey and New York worth more than $600 million and which employ more than 2,500 team members. The chain also has been named to Fortune magazine’s 100 Best Companies to Work For over the span of a decade.

Unfortunately, Stew Leonard made headline news in the early 1990s when he was found guilty of tax fraud.

Federal prosecutors said Leonard and a group of collaborators used a sophisticated computer system to skim $17.1 million off the books at his Norwalk, Conn., store between 1981 and 1991, in an effort to avoid paying $6.7 million in federal taxes.

In a July 1993 plea bargain, Leonard pleaded guilty to one count of income tax fraud and was ordered to pay $15 million in taxes and penalties and a $650,000 fine. In October 1993, he began serving a 52-month prison sentence. He was released after serving 44 months.

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Leonard's brother-in-law, a former store executive, was sentenced to 41 months in prison and ordered to pay $152,000 in fines. One employee was sentenced to 18 months in prison while another was sentenced to two years' probation for their roles in the scheme.

Tax problems also haunted Stew Sr.'s son, Tom Leonard. Tom Leonard was indicted in 1997 on a number of tax charges. In a five-count indictment handed down by a grand jury in U.S. District Court, Leonard was accused of diverting gross receipts and understating total receipts for the Danbury store in 1992, 1993 and 1994, and underreporting his and his wife's income for 1992 and 1993. He pleaded innocent.