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HOWS Markets shutting down all but Pasadena store

Upscale grocery chain, which had six stores in the Southland, is a casualty of the economic downturn.

December 03, 2010|By Sharon Bernstein, Los Angeles Times

At HOWS Markets' flagship store in Granada Hills, customers picked at a dwindling supply of goods. Price signs were crooked, black plastic sheeting showed through the scattered produce, and a sign on the roof declared in red letters, "Total Liquidation Sale."

From the sound system came Elton John singing that "sad songs say so much."

It was a sad state of affairs for an upscale market chain co-founded in 1999 by the heir of the Hughes family supermarket dynasty. The stores featured high-quality produce and meats at the Granada Hills location, as well as in Malibu, Pasadena, Torrance, North Hollywood and Canyon Country.

Members of the family, which had been in the grocery business since the 1930s, and their partners are shutting down all but one of the HOWS stores — only the Pasadena location will remain open.

"It's been a tough couple of years," said Mark Oerum, a partner in the small chain. When the economy went south three years ago, he said, customers who had bought steak switched to pot roast and chicken — and the stores suffered.

"It just got to the point where it wasn't right to keep it open," Oerum said.

The Granada Hills store will keep its doors open, he said, only as long as it takes to sell off most of the inventory.

HOWS sold its Torrance store to Super A Foods, a supermarket chain known for low prices and extensive Mexican prepared-food bars. The branch in North Hollywood is closed and empty, and the Canyon Country site, which closed several years ago before the current money crunch, is now a Big Lots.

The Malibu store is operating normally, but it will eventually close.

The company is moving its successful catering operation to the Pasadena store, which still gets a good flow of customers, Oerum said.

Phil Lempert, editor of the food industry website SupermarketGuru.com, said the troubles at HOWS didn't arise solely because it had higher prices than some competitors.

Customers are willing to patronize markets that are more expensive, he said, but only if the retailer offers a product mix or level of service that shoppers view as special.

"If you're just a traditional supermarket that has mostly the same things everybody else has, you're going to have a pretty tough time." Lempert said. "As an independent retailer you're going to have to have a personality — the same way Trader Joe's has a personality, or Whole Foods has a personality."

Oerum, 55, rose from bag boy to vice president of the old Hughes Family Markets chain. After Hughes was sold to Quality Food Centers for $359 million in 1997 (that company was later taken over by Ralphs Grocery Co.), Oerum and others helped start HOWS with Roger Hughes, the son of the founder of the Hughes markets.

The chain's name — HOWS — was an anagram of the first letter of Hughes' last name and those of partners Oerum, David Wolff and Steve Strickler. Wolff, with a new partner, will own and operate the Pasadena store.

The Granada Hills store, installed in a building that formerly held a Ralphs market, was the first HOWS. The most recent market in the chain was built from the ground up near the North Hollywood Red Line station. It was meant to be part of a massive redevelopment project to top off the area's ongoing revitalization.

But the economy crashed just as the store opened. The area's renewal stalled, and the market lost so much money that it dragged down the entire chain, Oerum said. Overall, the recession led many HOWS customers to shop elsewhere.

"The meat was good, but the prices were kind of high," said Carol Kapuscinski, who drove from Sylmar to buy discounted canned goods from the Granada Hills store on a recent morning. She loaded her car with cans of vegetables and other ingredients for marinated bean salad, saying she had not shopped at HOWS in a while.

"It's sad," Kapuscinski said.

Wolff, who started as a bagger in the Van Nuys Hughes market in 1973, said he planned to keep the HOWS name and signature product mix, including prime meats, at the Pasadena location.

He will also keep up the tradition of holding on-site barbecues on weekends.

Because the chain is unionized, he and Oerum said, many employees from the other stores will be able to find jobs at the Pasadena location. Super A, which bought the Torrance store, is also a union shop, allowing many employees there to retain their positions, Oerum said.

But the companies that are considering buying the Granada Hills and Malibu locations do not have unions, Oerum said.

The decision to close down most of the chain was made after Roger Hughes' death last summer, at age 76, from cancer. He had inspired intense loyalty among many of his employees, and some stayed with him for life.

Fifteen years ago, when Oerum's son Eric was in high school, he started at the company. Like his father, Eric began as a bag boy.

Now he's the manager of the Granada Hills store, overseeing the shutdown.

"It's all I've ever done," Eric Oerum said, fighting back tears. He's trying to find places for his 44 employees at the Pasadena store and spends a lot of time answering questions from customers.

After the store closes, he's planning to go into business with his father, running a sports bar that the pair purchased in Santa Clarita. Except for Wolff, the other partners — including Roger Hughes' heirs — are also getting out.

In Granada Hills, the liquidation sale is bringing in a lot of business, Eric Oerum said. On a recent morning, there were just a few muffins left in an otherwise empty bakery case, and a couple of pies sat nearby on a counter.

"Everyone's sad," Eric Oerum said of his customers. "And they're buying up everything we have left."

sharon.bernstein@latimes.com

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