AppleTree Markets
Encyclopedia
AppleTree Markets was a supermarket
Supermarket
A supermarket, a form of grocery store, is a self-service store offering a wide variety of food and household merchandise, organized into departments...

 chain in Texas
Texas
Texas is the second largest U.S. state by both area and population, and the largest state by area in the contiguous United States.The name, based on the Caddo word "Tejas" meaning "friends" or "allies", was applied by the Spanish to the Caddo themselves and to the region of their settlement in...

 formed in 1969 when Safeway
Safeway Inc.
Safeway Inc. , a Fortune 500 company, is North America's second largest supermarket chain after The Kroger Co., with, as of December 2010, 1,694 stores located throughout the western and central United States and western Canada. It also operates some stores in the Mid-Atlantic region of the Eastern...

 opened its first stores in Houston, which were spun off under the AppleTree name in 1988. The division once had 100 stores in Greater Houston
Greater Houston
Houston–Sugar Land–Baytown is a 10-county metropolitan area defined by the Office of Management and Budget. It is located along the Gulf Coast region in the U.S. state of Texas...

 and Greater Austin
Greater Austin
Austin–Round Rock–San Marcos is a five-county metropolitan area in the US state of Texas, as defined by the Office of Management and Budget. The metropolitan area straddles on the eastern edge of the and is situated in Central Texas....

. As of January 21, 2007, AppleTree operated two stores in Bryan, Texas
Bryan, Texas
Bryan is a city in Brazos County, Texas, United States. As of the 2010 census, the city had a total population of 76,201. It is the county seat of Brazos County and is located in the heart of the Brazos Valley . It shares its border with the city of College Station, which lies to its south...

, its current headquarters. AppleTree formerly had its headquarters in the Spring Branch area and in Houston.

Safeway

Safeway put its 18-year-old Houston division up for sale in 1988 in an effort to raise money to pay off debts from a $4 billion leveraged buyout in 1986. On June 14, 1988, Safeway agreed to sell its Houston division to Texas Supermarkets Inc., a holding company formed by local investors Duncan Cook & Co. and the Sterling Group. The deal included 50 stores in Houston, 20 in Austin, stores in 23 other communities in East and Central Texas, along with a distribution center, frozen food warehouse, bread manufacturing plant and milk processing plant. At the time of the $174 million transaction, Safeway's 18 percent market share ranked third in the Houston market behind Kroger
Kroger
The Kroger Co. is an American supermarket chain founded by Bernard Kroger in 1883 in Cincinnati, Ohio. It reported US$ 76.7 billion in sales during fiscal year 2009. It is the country's largest grocery store chain and its second-largest grocery retailer by volume and second-place general retailer...

, with 27 percent, and Randall's Food Markets
Randall's Food Markets
Randall's Food Markets operates 112 supermarkets in the Houston, Austin, and Dallas-Fort Worth areas under the Randalls, Flagship Randalls, Tom Thumb, Flagship Tom Thumb, and Simon David banners. Randall's employs more than 10,000 associates and is the Texas division of Safeway Inc. The Texas...

, with 21 percent. M. Dean Gantt, the former Houston division manager, assumed the position of president and chief executive officer of Texas Supermarkets Inc., which initially owned only eight of the stores from the transaction and leased the rest from Safeway. Texas Supermarkets was allowed to operate under the Safeway banner until June 28, 1989, but it would continue to do so until a new name began appearing in July 1989—AppleTree Markets. Five stores were renamed Budget Stores, stores with slightly lower prices on some items and fewer speciality shops such as delis, bakeries, and floral shops. The last of the Safeway banners was replaced in September 1989.

Gantt retired abruptly in October 1989 and was replaced a month later by Arthur L. Patch, senior vice president of Dublin, California
Dublin, California
Dublin is a suburban city of the East Bay region of Alameda County, California, United States. Located along the north side of Interstate 580 at the intersection with Interstate 680, roughly east of Hayward, west of Livermore and north of San Jose, it was named after the city of Dublin in...

-based Lucky Stores
Lucky Stores
Lucky Stores is an American supermarket chain founded in Alameda County, California in 1935. Lucky is currently operated by SuperValu in Southern California and Nevada and by Save Mart in Northern California and Nevada.In 1998, Lucky's parent company, American Stores, was taken over by Albertsons,...

 Inc.

Bankruptcy

The company struggled with the debt that originated from the 1988 leveraged buyout out Safeway's stores. After failed attempts to restructure that debt, AppleTree sought Chapter 11 bankruptcy
Chapter 11, Title 11, United States Code
Chapter 11 is a chapter of the United States Bankruptcy Code, which permits reorganization under the bankruptcy laws of the United States. Chapter 11 bankruptcy is available to every business, whether organized as a corporation or sole proprietorship, and to individuals, although it is most...

 protection in 1992. Soon after the filing, AppleTree announced its plans to begin closing stores. Arthur Patch resigned his post in March 1992, and the chairman of the company's board, Fred R. Lummis, took the helm. Also a growing problem was the chain's aging store base. The bulk of Safeway units in Houston dated from the late 1960s and early 1970s, and a logo change in 1981-1982 was the only alteration, if any, to most of such stores before the AppleTree split. Many former Weingarten's
Weingarten's
Weingarten's was a supermarket chain in the Southern United States until it was acquired by Safeway in 1983. J. Weingarten, Inc. had its headquarters in what is now the East End in Houston, Texas.The company survives to this day as a real estate developer, after leaving the retail grocery business...

 stores, which had been acquired by Safeway in 1983, were even older. A very small minority of Houston Safeways were built in 1986, but these were larger and had a more modern, conventional prototype. This was in contrast to the reinvention of Super Fresh
Super Fresh
Super Fresh is a chain of supermarkets owned by A&P, which introduced the banner in 1982, converting its Mid-Atlantic region's stores to the new name. Super Fresh's 24 stores are mostly in the Philadelphia, Pennsylvania area, plus Delaware and southern New Jersey...

 beginning in the early 1990s, a chain which itself was spun off from A&P
The Great Atlantic & Pacific Tea Company
The Great Atlantic & Pacific Tea Company, better known as A&P, is a supermarket and liquor store chain in the United States. Its supermarkets, which are under six different banners, are found in Connecticut, Delaware, Maryland, New Jersey, New York, and Pennsylvania. A&P's liquor stores, known as...

's Philadelphia division in 1982. Also in Philadelphia, many A&P as well as Acme and Food Fair (doing business as Pantry Pride in its later years, and not related to the current Houston chain of the same name), and Penn Fruit
Penn Fruit
The Penn Fruit Company was a regional grocery chain in the Philadelphia and Baltimore areas that operated from 1927 until 1978. During the firm’s history it was regarded as one of the most innovative American supermarket chains...

 (acquired by Food Fair during the same period) stores closed and reopened as IGA
IGA (supermarkets)
IGA is a brand of grocery stores active in more than 30 countries. Contrasting with the chain store business model, IGA operates as a franchise through stores that are owned separately from the brand. Many of these stores operate in small town markets and belong to families that manage them...

 and related chains Thriftway, Shop 'n Bag, O&O, Pick Well, Great Valu (SuperValu
Supervalu (United States)
SuperValu Inc. is a United States grocery retailer and distributor. The corporation, headquartered in Eden Prairie, Minnesota, has been in business for over a century. It is the third-largest food retailing company in the United States , and ranks #51 on the Fortune 100 list.On June 2, 2006,...

), and ShopRite
ShopRite (United States)
ShopRite Supermarkets is a retailers' cooperative chain of supermarkets in the northeastern United States, with stores in New Jersey, New York, Connecticut, Delaware, Maryland, and Pennsylvania...

. Philadelphia retail icon Thrift Drug
Thrift Drug
Thrift Drug was a pharmacy chain based in Pittsburgh, Pennsylvania that was founded in 1937 and purchased by J.C. Penney in 1968, and was expanded greatly thereafter. The chain served as the flagship chain of J.C. Penney's pharmacy group. The chain didn't hide its affiliation with J.C. Penney, as...

 was also absorbed into Eckerd in 1997, but many of its stores were relocated or closed soon after.

To cut costs and raise cash, AppleTree continued to close stores or sell its stores to competitors such as Fiesta Mart
Fiesta Mart
Fiesta Mart Inc. is an American supermarket chain based in Houston, Texas that was established in 1972. Fiesta Mart operates stores in Texas, including the Houston, Dallas/Fort Worth, Austin, and Waco areas. The chain uses a cartoon parrot as a mascot...

, Gerland's Food Fair, and Market Basket
Market Basket
Market Basket is a supermarket chain that serves southeast Texas and Louisiana. Formed in 1962, the grocer now operates 34 Market Basket stores and four Lucky Seven conventional supermarkets and employs 2,200 associates. It is headquartered in Nederland, Texas.-History:Johnnie Alford, Ed Hughes,...

. The company would also look to move its headquarters to a smaller facility, as well as close its distribution warehouse.

In its reorganization plan, AppleTree announced plans to close or sell 33 additional stores.

Post-bankruptcy

As a result of the reduction of stores, AppleTree's northwest Houston grocery distribution facility, which included a 119000 square feet (11,055.5 m²) refrigerated warehouse, a large bakery and a major milk plant, was larger than AppleTree's needs. The facility was still owned by Safeway, and it was sold to H-E-B
H-E-B
HEB Grocery Company, LP is a privately held San Antonio, Texas-based supermarket chain with more than 315 stores throughout Texas and northern Mexico. The company also operates Central Market, an upscale organic and fine foods retailer.H-E-B ranked No...

. As a result, AppleTree would buy its dairy products from a supplier and also relocated its headquarters to a building in northwest Houston.

AppleTree announced in November 1993 it would sell its remaining 49 stores to competitors. Eleven stores were sold to Kroger
Kroger
The Kroger Co. is an American supermarket chain founded by Bernard Kroger in 1883 in Cincinnati, Ohio. It reported US$ 76.7 billion in sales during fiscal year 2009. It is the country's largest grocery store chain and its second-largest grocery retailer by volume and second-place general retailer...

, five stores to Gerland's, four to Fiesta Mart, three stores to Rice Food Markets
Rice Epicurean Markets
Rice Epicurean Markets is an American niche grocery store chain based in Southwest Houston, Houston, Texas. The company operates five Rice Epicurean Markets, which range in size from 25,000 to . Rice Epicurean Markets is wholly owned by founding family members.- Rice Boulevard Food Market :Founded...

, 15 to Randall's Food Markets
Randall's Food Markets
Randall's Food Markets operates 112 supermarkets in the Houston, Austin, and Dallas-Fort Worth areas under the Randalls, Flagship Randalls, Tom Thumb, Flagship Tom Thumb, and Simon David banners. Randall's employs more than 10,000 associates and is the Texas division of Safeway Inc. The Texas...

 (including 12 Central Texas locations, of which three were closed), and one store each to H-E-B, Cox's Foodarama, Big Chief Super Markets, Stanley Stores, Super Warehouse Foods, and Sellers Bros.
Sellers Bros.
Sellers Bros. is a chain of grocery stores based in Houston, Texas, United States.The company was formed in 1921, and its officers are George R. Sellers, Joseph L. Sellers and John L. Sellers....

. Ironically, some of the former Safeway stores Randall's purchased from AppleTree became part of Safeway once again when Safeway bought Randall's in 1999.

AppleTree chief executive Tony Kubicek purchased the last six AppleTree stores and planned to operate the stores as an independent, Houston-based chain bearing the AppleTree name. Three of the stores were in Bryan-College Station
College Station, Texas
College Station is a city in Brazos County, Texas, situated in East Central Texas in the heart of the Brazos Valley. The city is located within the most populated region of Texas, near three of the 10 largest cities in the United States - Houston, Dallas, and San Antonio...

, two in Houston, and one in Huntsville
Huntsville, Texas
Huntsville is a city in and the county seat of Walker County, Texas, United States. The population was 35,508 at the 2010 census. It is the center of the Huntsville micropolitan area....

.

Current operations

AppleTree closed its last Houston location in 1997. With the closing, AppleTree operated three stores in Bryan-College Station, where it would eventually relocate its corporate staff and also where chief executive Tony Kubicek 35 years earlier sacked groceries at a Safeway store when he was a student at Texas A&M University
Texas A&M University
Texas A&M University is a coeducational public research university located in College Station, Texas . It is the flagship institution of the Texas A&M University System. The sixth-largest university in the United States, A&M's enrollment for Fall 2011 was over 50,000 for the first time in school...

.

AppleTree further retrenched to its two Bryan locations after closing its College Station store.

AppleTree has sold its Briarcrest Drive store in Bryan to the owner of the Galleria Village. The name change occurred in February 2009 to Village Foods. AppleTree kept its Bryan location at Highway 21 and Texas Avenue until it succumbed to bankruptcy in late 2009 or early 2010, putting the chain to rest for good.

External links

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