Rutter 's Ramps Up, Inside & Out

Retailer to debut new stores, food, car washes with $55 million expansion

Samantha Oller, Senior Editor/Fuels, CSP

YORK, PA. -- Rutter 's Farm Stores, an operating company of Rutter 's Holdings Inc., will invest $55 million in 10 convenience stores and 11 car washes as part of what it describes as “the biggest one-year capital expenditure” in its history. The retailer is also expanding its Central Pennsylvania range into nearby two new markets—Carlisle and Chambersburg—as well as into Dauphin County.

“We constantly delve within our existing area and keep trying to move outside of that a little bit each time,” Scott Hartman, president and CEO of Rutter 's, told CSP [image-nocss] Daily News. “We 're not the type of company who jumps two states over, or go from here to Pittsburgh. We just keep growing our existing area.”

The growth initiative, as reported last week in a CSP Daily News Flash, follows a healthy financial year for Rutter 's, which generated more than $400 million in sales in 2007.

The expansion will increase Rutter 's store count to 58, and generate 350 new jobs representing more than $4.5 million in annual wages and benefits. Although the retailer has been adding to its corporate ranks in the past few months, most of the new jobs are store-level, with each location employing up to 35 people.

Many of the sites have been in development for the past two to four years, Hartman said. Three of the stores will be on existing sites, while the remaining seven will be new to the chain. The openings will be staggered throughout 2008, with the first three or four to open their doors in April or May.

Outside, the new stores will feature nine to 10 multiple-pump dispensers, for a total of 18 to 20 pumps. It 's a continued expansion of Rutter 's fuel footprint; last year, the company, which claims to be one of the highest-volume retailers in Central Pennsylvania, upgraded to “the fastest gas pumps allowed by law” at its 46 sites that sell fuel. Diesel pumps will be installed at the rear of the stores wherever possible.

Some of the properties will also include separate bank branches elsewhere on the lot, a reflection of Rutter 's continuing real-estate activities and the larger lot sizes that the retailer is developing—up to 5 acres in some instances.

The new stores will not only be larger than average—5,300 to 5,800 square feet—but Rutter 's will also have a few other surprises for customers, including:

New food. Rutter 's plans to unveil new food concepts at the new stores, but for now, the details are “top secret.” Hartman did acknowledge that the products will fall in line with the “healthy” and “grab and go” trends, and will include one concept that may be new to the channel. The products are currently undergoing testing at a prototype store.
New media and technologies. The retailer will also feature “new media and technologies” in its newest stores, although the details here are also top secret and the offerings still under development, Hartman said. New car washes. Rutter 's is installing 11 new car washes, a significant expansion of its 3-year-old launch into the profit center, to give it a total of 14 washes chainwide. The dual-bay washes will feature combination touchless/friction washes from Jim Coleman Co.

The growth spurt also advances Rutter 's “green” push, which consists of 15 initiatives divided into three areas: light and energy savings, car wash and recycling. The retailer is installing computerized climate and lighting control systems from Emerson Climate Technologies in its new stores, as well as energy-efficient T5 lighting.

It aims for all of its car washes to be phosphate-free by the end of the first quarter of 2008 and has implemented recycling programs for everything from frying oils to light bulbs. And the new stores will feature white roofs instead of black to help save on cooling costs in the summer.

Hartman said the goal is for all of the green initiatives to be implemented by the opening of the first new stores this spring.

“It 's a trend I just think all of us need to recognize; it 's not a fad, and [it 's] something we need to be embracing,” said Hartman of environmental consciousness. “Also, to us, it 's an evolutionary thing; it 's not a revolutionary thing. We 're not tearing the roofs off our stores and making them white. But if we need to replace a roof, we 'll replace it and make it a white one.”

Meanwhile, the retailer received good news last week when the state of Pennsylvania 's agriculture department reversed course on an earlier ruling and announced that Rutter 's and other dairies could promote the fact that their milk is produced without the use of artificial growth hormones, or rBST.

This marks the second time the Pennsylvania agriculture department changed is stance on the labeling issue. Last year, just a few weeks after Rutter 's received permission to label its milk as rBST-free, the agriculture department reversed its decision and accused the retailer and 15 other dairies of misleading consumers.

It 's a charge Rutter 's didn 't take lying down. It sent 10 executives to the state capital to argue its case and got customers engaged in the cause with a website-driven write-in campaign.

“It 's a fascinating exercise of how a few people can actually change the government 's approach,” said Hartman. “It 's just something the industry shouldn 't be ignoring at all. The ability to understand what 's going into your food, the traceability of food products today, the trust of supply chain—those are all things that are only going to grow.”

“We 're just a little dairy standing up among the big ones saying, ‘Hey, this is not the way we want to go—consumers want to know, '” said Hartman. “And it worked.”