Houston’s own Joe V’s prepares to head to Dallas

Howdy folks, and welcome back to Houston Historic Retail! Today we’re talking about Joe V’s Smart Shop, a Houston-developed discount grocery store headed for DFW. The first Joe V locations opened in the summer of 2010. HEB pitched the stores as Aldi-Fighters, just as the discount German grocer gained a foothold in the Houston market. Despite this comparison, the first stores were reminiscent of the old HEB Pantry Foods concept. You could still find the brand names you were looking for (Coca-Cola, Lay’s, Heinz); however, there were at least three private label options for every brand name. The store brands were, of course, HEB, and Hill Country Fare, in addition to the rarely seen bargain basement Economax. There were some Aldi-like features, such as a requirement to bag your own groceries or not supplying carts at the door (only in the parking lot). Overall though, the stores didn’t resemble Aldi. They were much larger and featured leased spaces to Cell Phone and Jewelry stores, similar to Fiesta. Joe V’s initial reception was somewhat mixed. While most appreciated the savings, some noted that they felt their communities deserved a full-size store. Overall, the reception was positive, and Joe Villereal, President of Joe V’s and developer of the concept gave the green light to continue building new stores. I first checked out Joe V’s about ten years ago when I started working near one of their early locations. I found it to be a pleasant albeit barebones shopping experience. I felt the Aldi comparison was valid at the time, but given the choice, I’d go for Joe V’s. For this article, I went back to the same location to observe how the chain has matured.

Revisiting Joe V’s was interesting. One of the first things I noticed had changed was that the store had gone somewhat upscale! While you still have to bring in a cart from outside (no quarter required), one of the first things you see going through the one-way entry is a Sushiya Counter, just like you’d find at any HEB. Being a former Service Merchandise, this location is not spacious, but this was a full-sized counter tucked in sideways. The other updates were the product selections. The ratio of brand names to generics has changed slightly, with more brand names on the shelf and hardly an Economax product. The final real stand out was the self-checkouts I did not expect to find in a Joe V’s, much less this tiny one. The changes do seem to provide an overall positive effect on the store. I priced check items during my visit, which consistently came up lower than the nearest HEB, both Brand Name and Private Label. So let me know pose the question, why exactly is HEB bringing Joe V’s to Dallas? Is it to take on Aldi? No, in my opinion, it’s not. It’s to take on Winco. For my mainly Houstonian audience, who are likely unfamiliar with Winco, it’s nearly identical to what Joe V’s is doing—a no-frills supermarket operation operating at bargain basement prices. Winco has found great success operating throughout the Western U.S., where they are often the cheapest option next to Walmart, winning them shoppers in less than stellar economic conditions. Despite covering a larger geographic area, Winco is a significantly smaller operation than HEB in terms of store count and revenue. HEB’s lack of traditional stores in DFW opened that market for a competitor like Winco, where they’ve found great success. They do have some caveats, Winco stores are often 24/7, and the vast majority (including those in Texas) don’t accept credit cards. It will take time to see how Joe V’s does in DFW, but I’m predicting now it won’t be easy for Winco, who seems unsteady in Texas at the moment.