The Journey from Fed-Mart to Fiesta!

Howdy folks, and welcome back to Houston Historic Retail! Today we’re looking at a Fiesta on Houston’s Southeast side with an interesting history. The building this grocery store occupies at 5600 Mykawa Rd, Houston, TX 77033, has an interesting history. The building was constructed in 1958 for the Fed-Mart company. For those not in the know, Fed-Mart was a chain of sores based out of California. In modern times the stores are often compared to Costco, or Price Club, both companies in which founder Sol Price would later have a hand in. In reality, though, the store’s merchandise mix would be closer to modern-day Walmart. Items were mostly not sold in huge bulk lots, and the breadth of merchandise went from garden centers to groceries, exceeding most Warehouse Clubs. The reputation of Fed-Mart as a warehouse chain is largely based on the concept that initially, the stores were only open to members. The name only provided further confusion and started another false rumor that these stores were only for government employees. The truth of the matter though is that initially, you did need a business license to purchase from Fed-Mart, and the next group to be allowed membership was, indeed, government employees. However, by the time Fed-Mart arrived in Houston, the membership policy had been considerably relaxed, allowing for many new customers. Fed-Mart was set up to serve as a state-of-the-art store. Not only would the selection be massive and the prices super low. Fed-Mart stores would handle their own distribution at each location thanks to railroad spurs built to service them. Fed-Mart beat Wal-Mart, Kmart, Target, Gibsons, and just about any other discounter to the punch. However, this dominance would not last, and by the 1970s, Fed-Mart was facing intense pressure.

Most of Fed-Mart’s issues came from their expansion towards the East. FedMart’s expansion had brought with it the introduction of smaller stores, along with the purchase of existing chains, such as the Globe Department Store chain. When Fed-Mart began to hit eastern states, they found themselves in the midst of competition they weren’t prepared for. Fed-Mart would begin a quick retreat from losing states, but this interaction with other chains provoked them into entering Fed-Mart’s territory, the Southwest. Throughout the 1970s, Fed-Mart would try to bolster its numbers by building more stores. In Texas, Houston had proven to be a stronghold, and with a lack of strong competition other than Kmart, Fed-Mart continued to open multiple stores here. By about 1979, Fed-Mart had six locations in Houston, far more than most other cities. This expansion, however, would leave them vulnerable to competition in California, specifically from chains like Target, which presented themselves as being just as cheap as Fed-Mart but with better quality. In 1981 Fed-Mart pulled the plug on most stores outside of California, including their Texas locations. Unfortunately, many blame the downfall of the chain on the company pushing founder Sol Price out in the mid-70s. Price wouldn’t stay out of Houston for long, though, bringing his Price Club discount warehouse concept to Houston in the early 90s and encouraging Costco to take a look at Texas after their merger, although that’s a story for another day! Fed-Mart would sell its Houston locations to the newly expanding Fiesta, which would use the extra space to broaden its selections, a characteristic passed onto other stores.