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Managing Growth: Pete's Frootique

By Julie King |

Pete's Frootique, a specialty grocery store with locations in downtown Halifax and Bedford Nova Scotia, has seen tremendous growth over the past 15 years. The company, which started as a single Bedford store with 16 employees, has grown to over 250 employees at its two locations.

As you might imagine, this rapid growth has come with some distinct business challenges.

Challenges are something that all businesses must be prepared for, but there is a lot to learn from companies that have successfully navigated the growth process. Dianne Hamilton, the controller of Pete's Frootique, was able to provide us with insights into how this unique company survived when so many others would fail.

Today Pete's Frootique consists of two retail stores that have taken a market approach to the way they sell their products.

The company opened its first store in 1992 and in 1993 - 94 they added a wholesale business. However, the majority of its growth came after the 3rd year.

In 1997 the store moved to a much larger retail space that was 11,000 ft2. A year later they added an English butcher shop that specialized in fine cuts of meat and in 2003 a fish shop was added in the flagship store. The Halifax store opened in November 2004.

A shopping we will go
Sunday shopping regulations was one of the major challenges the company faced when it started to grow. Under the province's Sunday shopping legislation, a store cannot open on Sundays unless it is less than 4000 square feet in size. The stores were too big to meet this requirement, but it was essential for their success that they find a way work around this restriction.

To address this potential stumbling block, the company went through a reorganization, forming several smaller corporations that may have shared a common location, but were each within the space limit imposed on businesses that would open on Sundays.

They had solved the Sunday shopping restrictions, but at the same time made their operations much more complex. Each corporation within the company has both an owner and department manager for each store.

Keeping accounts
When Pete's Frootique started to grow it soon became very difficult for it to implement systems that could keep up with the rapid growth and changes taking place at their two stores.

The cluster of independent companies added a further complication. Their unique approach meant that systems that would normally work for retail stores did not work for them.

Hamilton credits Pete Frootique's partnership with its accounting software provider, Simply Accounting, for their success in navigating some tricky management challenges.

"You need to be willing to step outside the box and not look at the norm," says Hamilton.

To address their unique needs from an accounting perspective, Pete's Frootique looked at their accounting software provider, Simply Accounting, as a partner. They regularly communicated with the software company to request new features that would enable them to operate more efficiently.

Hamilton points to payroll management as just one way that the two companies worked together. While the company was made up of a group of independent corporations, it needed a single payroll journal so they could enter all their employees on a single screen. They asked Simply Accounting to adjust their software to meet Pete Frootique's needs and the software company implemented the feature they had requested.

Inventory management
Hamilton explains that Simply Accounting also provided an efficient way for the company to manage its inventory.

"When you sell food products your inventory has a fixed expiry date so everything moves at a fast pace," says Hamilton. "You need to make decisions immediately and don't have time to think things over."

"Implementing systems that would allow you to have good information for inventory every day, to know when things were about to expire when they needed to be marked down, when they needed to be moved into our juice bar … made it possible to stay ahead."

Attracting "yummy mommies"
People are behind the success of almost every business. But how do you attract loyal employees who represent your company well in a market where there is a shortage of workers?

"It is really important to put a great group of people around you that can work well together," says Hamilton. "Everyone brings something to the table … there is always a solution."

To attract workers to Pete's Frootique, the company was working against a labour shortage, the attraction of relatively high paid jobs in the call centre industry and what Hamilton refers to as "the call of the West" where western companies were actively recruiting in their area.

For years the company tried to handle these challenges on their own, until they finally decided to open an HR department. An excellent HR manager combined with creativity have helped Pete's Frootique overcome its workforce challenges.

When hiring, the grocer is looking for mothers who have children in school. The company works hard to make the workplace attractive to them and it goes outside of the box to attract these workers. Ultimately the goal is to create a win-win situation for both parties.

Part of the strategy has been to attract "yummy mommies" by offering a fairly hefty discount for employees.

They are also actively working with people in some of the newer cultures who have just come to their area from different countries.

Looking ahead
Right now Pete's Frootique is looking at a refit of the original flagship store. The owner has lots of ideas — it's really hard to say but certainly they are still going through some great growth in the Halifax store.

They may also face some new challenges with talk of Sunday shopping laws tightening up in Nova Scotia.

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