Howdy, folks, and welcome back to HHR. Today we’re taking a preliminary look at Houston’s newest supermarket chain, GFS. The stores were established in the late 70s by Gordon Food Service, a wholesaler looking to move into the consumer space. The chain was initially quite spartan but has grown to compete with modern grocers.GFS stores are known for prominently featuring their house-branded products for good prices. They also feature wholesale and retail size packs without a membership requirement. More recently, the stores have added limited service departments, including a deli with pre-sliced meats and cheeses, along with cold sides and flavored popcorn.
GFS entered Houston through the 2014 purchase of the Glazier Foods distribution company. These new stores represent GFS’ further push South, except for a small collection of locations in Flordia after a 2003 purchase of a distribution company there. My experience with GFS comes from encounters in the Midwest, where they were a common supplier and had plentiful locations. Their older stores are more dedicated to wholesaling and less directed to consumers. However, as of the past few years, it appears that GFS is remodeling its older locations to take on the hybrid approach being used here in Houston. So far, the chain is working on six stores throughout town.
- 5151 Antoine Dr, Houston, TX 77092
- 12533 Westheimer Rd, Houston, TX 77077
- 13817 Breck Street Houston, TX 77069
- 649 S Mason Rd Katy, TX 77450
- 215 W. Main St League City, TX 77573
- 5300 N Braeswood Blvd, Houston, TX 77096
In Houston, GFS will have quite a bevy of competition. Their locations mostly avoid areas strongly claimed by traditional grocers or even other wholesalers. The combination of wholesaler and grocer does provide them a unique edge in that they don’t require a membership. While there is no shortage of consumer-level Sam’s customers in Houston, their target of non-wholesale dense areas will likely bring in customers who do not have club memberships. While all this works in GFS’ favor, we, as Houstonians, know that one thing for sure will determine their fate, prices. Some locations are currently hiring, expect the first stores to open in early 2023.
As a former Midwesterner, I frequently shopped at GFS. In December I was traveling for work and came across a brand new GFS store in Memphis and fell in love all over again. In fact, I brought back several family favorites. While there, I was told that they were opening stores in Texas soon. I am in San Marcos and will be traveling down there as soon as I get the word they are open. I think their prices are comparable or even better. For instance, I bought fresh squeezed orange juice for 99 cents whereas the same size bottle at HEB is $3.98 and they taste the same. They also carry items that I can’t find down here in our area but are staples up north. They have a lot of restaurant supply items, like 1lb packets of gravy mix or bags of precooked chicken wings like we have at our coney islands. Can’t wait until they move in the Austin or San Antonio areas.
Over the holidays I visited the new GFS in Memphis, and it was interesting, but seemed not to have very good prices on most items… at least, definitely not the individual consumer oriented ones. I guess it’s harder to speak for the bulk items: normally, as I understand it, the idea is that buying in bulk results in a cost savings. But is there a certain point where, for places that must shop in bulk, the prices arbitrarily go back up again because there is a captive audience? Not sure. If that’s true, then maybe Gordon’s bulk prices actually are good. But compared to Sam’s, they were not. I guess they could be factoring in the lack of a membership fee, too…
Thanks for the update, Retail Retell. GFS Stores are still a bit of a mystery to me in terms of pricing and selection so I’m interested to see what their stores will be like when they open here. Although Sam’s Club and Costco both have a large presence here, at least in the outer suburbs in the case of Costco, it seems that GFS is locating their Houston stores in areas that are a bit distant from the nearest Sam’s and Costco stores. Perhaps because of their pricing disadvantage, they are purposely trying to attract customers who generally don’t shop at the two warehouse giants. Of course, Houston also has a lot of price-driven grocery competition as well so GFS will have to be careful with that.
I’d imagine that most of GFS’s major bulk clients would prefer to use their traditional delivery service, but perhaps there is some need for pick-up type locations for bigger restaurants. Smaller restaurants may not have the scale to use delivery, I’m not sure.
I suppose there are too many unknowns for me with GFS to have any sense if they’ll succeed here or if they’ll be on the long list of retailers who came to Houston with high hopes and then retreated very quickly. The news about high pricing is not promising though. Even compared to other markets, Houstonians are not known for tolerating high prices even if a retailer has other things going for them.
One exciting thing about GFS Stores is that they are moving into a lot of shopping centers which could really use a boost by having a grocery anchor. North Oaks Mall and Antoine are certainly two examples of that. Hopefully these stores are able to help stabilize some of these older shopping centers. Some of them have not seen grocery anchors in years…decades really.