“Presently IGA is an Alliance of 5000 supermarkets, 36 Distribution Centres and more than 50 vendors across 30 countries and records over $31bn a year in sales”
RA: What is IGA?
MB: IGA, or the Independent Grocers Alliance, is a USA-based not-for-profit company designed to help independent grocery retailers reach and maintain equal footing against chain store competition.
IGA’s history goes back to J. Frank Grimes, a U.S. accountant who in the mid-1920s became concerned that the rapid growth of corporate chains would lead to the demise of family-owned, community-focused grocers. Grimes spent a year talking to independent grocery retailers, wholesalers and vendors in an attempt to discover what could be done to help independents capitalize on their inherent entrepreneurial spirit, and use their independent creativity and vitality to compete successfully against national chains.
Following his year of discovery, in 1926 Grimes founded the IGA Alliance, a collaborative brand that would give independents equal footing against the chains by giving them close relationships with other independent retailers and the industry’s most successful wholesalers and manufacturing and service provider partners; the power of a shopper-recognized brand; and the ability to maintain both independence and interdependence.
In May 1926 a group of 100 independent retailers organized themselves under the IGA brand. This group quickly expanded, and by the end of the year there were more than 150 IGA retailers. In 1930, there were over 8,000 grocery stores using the IGA name. Presently IGA is an Alliance of 5000 supermarkets, 36 Distribution Centres and more than 50 vendors across 30 countries and records over $31bn a year in sales. The stores in Alliance remain independently owned and operated but have common store branding with the world-recognized IGA logo, and the advantage of IGA marketing programs that help retailers connect with shoppers.
Even today, independent family owned businesses, contribute 45- 50% of the grocery business in the USA. The rest has been taken over by the big players like Walmart. But these stores have an important role to play since local, family owned retailers can react far more quickly to local needs than the big guys. IGA’s role is to support these retailers to help them overcome the inefficiencies associated with lack of scale.
A brief historical chart of the IGA is as follows:
1926: IGA is founded and the first store opens in USA. By the end of the year more than 150 IGA stores are in operation.
1927: The first IGA Brand product, IGA flour, goes on sale.
1929: IGA expands across the country with more than 1,500 stores in 36 of the 50 states of USA.
1938: IGA offers 360 IGA Brand products.
1951: The first IGA store opens in Canada.
1976: A new IGA logo—the current day Red Oval—is unveiled at IGA’s 50th Anniversary convention in Chicago.
1986: The Red Oval Family Partnership is formed with 30 of the United States’ favorite national brand companies, creating a special relationship that benefits IGA Retailers and the customers they serve.
1988: IGA launches its “Hometown Proud Supermarkets” national marketing theme, a slogan that is still embraced in IGA communities today.
1995: IGA expands to China, Singapore, Malaysia and the Caribbean.
2008: IGA expands into Russia.
2010: IGA’s brand products get an updated new look.
2011: IGA goes digital. Every IGA store has a personalized website and mobile web app featuring some of the industry’s most progressive shopper marketing tools.
2012: IGA comes to India
RA: How does becoming part of the IGA benefit small, family owned grocery stores?
MB: The Alliance oversees several resources shared among the member stores. These include:
i) The Alliance aggregates volumes and helps the member retailers negotiate a marketing overlay. This could be as high as a 1% gain in margin. So any member retailer will get the additional overlay negotiated by IGA, over and above the discount that they may have individually negotiated with the brand.
ii) IGA has its own range of IGA brand products which are only available at IGA stores. IGA works through selected vendors who are allowed, at no cost, to use IGA branding for an exclusive range of products.
iii) The Alliance provides a number of additional services like online training for retailers and store staff, a daily newsletter and a store locator to help customers find the closest IGA store.
iv) It also allows member retailers to post queries and share information through a B2B site for members.
RA: How does a retailer become a member of IGA?
MB: IGA entered the Indian market in June 2012. It is represented in India by Banaras House.
IGA USA fees are $375 a month. Outside the U.S. the fees are $30 a month - all in U.S. dollars. To become an IGA member in India the grocery retailer needs to have a minimum sqft area of 1,000 sq ft. The retailer also needs to have ethical business practices and sell safe food (refers to food that is safe to consume, is handled properly and packaged properly, under the laws and guidelines of the country producing the food).
IGA will also be launching its IGA branded product in India, for member retailers. The initial selection is focused on categories which are poorly represented in the Indian market but which are seen to have growing demand e.g. baked beans, tuna, noodles.
Grocery retailers who wish to know more about the IGA can contact Mr. Binay Kumar whose coordinates are shared as below: