Harps Grows Amid Market Turmoil

by Jamie Walden  on Monday, May. 25, 2009 12:00 am  

Harps Chairman and CEO Roger Collins, left, Chief Financial Officer Jim Antz and Vice President of Human Resources Frank Ray anticipate building three or four new stores per year.

Despite the tumultuous economy, one of Arkansas' private companies is on a growth path that has it gobbling up stores and erecting new buildings.

Harps Food Stores Inc. of Springdale hoisted its revenue 10 percent to $440 million during its fiscal 2008. That growth is not because of food inflation resulting from the spike in gasoline prices last year, Harps Chairman and CEO Roger Collins said.

Instead, Collins attributed the organic growth in sales to the company's aggressive and unflinching growth path. During the last six months, Harps added 10 stores.

Harps acquired a grocery chain based in Malden, Mo., called Wallace & Owens Inc., in a deal that closed in December. That purchase added eight stores to Harps' portfolio, including two Arkansas stores, in Jonesboro and Corning. Collins wouldn't disclose the cost of the purchase.

Up until about four years ago, Harps had grown primarily by acquiring other stores. "And then we started a program of aggressively trying to build stores," Collins said. "I'd be disappointed if we didn't build three or four stores a year."

Harps can better brand itself as higher quality through building new stores than by acquiring older, outdated buildings, Collins said.

An acquisition as big as the Wallace & Owens purchase, however, is abnormal, he said, adding that Harps plans to grow primarily by building new stores.

Harps recently built a store in Benton, which opened in mid-March. Collins wouldn't divulge proposed site locations for new stores, but he did say that the company looked at a site in Little Rock.

Collins said he sees the possibility of an advantage arising from the Affiliated Foods' bankruptcy and Harvest Foods' diminished market presence. However, he wouldn't comment on how Harps might gain an edge from the situation, citing competitive reasons.

Employee Incentive Plan

Not all of Harps' success has been external.

In 2001, Harps bought all of the company's stock from the Harp family, which had owned the chain since it opened during the Great Depression in 1930.

Since the buyback, Harps has used the stock as an incentive program for employees.



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