Article

Kicking the Habit

How Harmons Removed Tobacco without Burning the Bottom Line

Di Lewis

June 7, 2013


In mid-2012, Harmons grocery stores did something no one would think a grocery store would do. It took tobacco products off the shelves and declared the stores tobacco free.

The change was a few years in the making but, for Bob Harmon, the catalyst was thinking about the hypocrisy of a company trying to provide fresh, healthy food while selling something proven to do harm. That thought, urged along by  Harmons President and ex-smoker Dean Peterson, got the ball rolling.

A Contradiction and a Decision

Harmon says the company had already been making changes to provide healthier alternatives and more organic options, and to ensure all in-house food is made without ingredients like MSG or artificial colors. So it seemed contrary to the company’s goals to continue carrying tobacco. Harmons had also started an employee wellness program, which Harmon says really highlighted the choice the company had to make.

Once that decision to remove tobacco was made, he says there was no turning back.

The $2.25 million in revenue that tobacco products brought in was a relatively small percentage of Harmons’ overall revenue, he says, but it could have been double or more and they still would have chosen to remove the unhealthy products.

 “We pulled some numbers and said, ‘Well what does this really mean?’... But that didn’t enter in our decision of how we wanted to do this,” Harmon says.

Harmons had already started to see a rise in demand for things like gluten-free, vegan and organic food options, and the corresponding rise in revenue made it so the company wouldn’t really have a deficit to make up. “So we didn’t look at it like we had this big chunk of money that we’ll have to take care of,” he says.

Removing tobacco also freed up space to stock more of those products and to put a certified Post Office in every store. The company still stocks tobacco cessation products, but not replacements such as e-cigarettes.

Making the Change

Though the decision to remove tobacco was ultimately an easy one to make, Harmon says company officials did worry about how customers would react. But the implementation was fairly painless, which he credits to the open communication the company had with associates, then with customers to explain why they were removing tobacco.

Harmons first educated associates about why it was making the change, and Harmon says they took it well but were concerned about how customers were going to feel about it. The company posted signs in all the stores letting customers know when Harmons would stop carrying tobacco and why.

 “And literally it wasn’t a problem. We didn’t get a lot of negative feedback,” Harmon says.

The switch went very smoothly due to the store giving customers and employees enough time to understand and get used to the change, as well as being open to talking about it. The company also opened three locations—City Creek, Emigration and Station Park—without ever stocking tobacco.

Though there have been many questions about Harmons’ no-tobacco policy, including why the grocer continues to sell other unhealthy foods, Harmon says the key to keeping everyone happy is clear communication.

Harmon says he does think it’s
helpful that Utahns aren’t heavy tobacco users, but doesn’t think that’s the only reason the removal was successful. He thinks customers appreciate consistency in the company’s message about healthy living and says other companies could do the same thing as long as they are very open with people as the tobacco removal is implemented.

 “It was less difficult than you might think. It shows that you are caring about what you are saying,” he says. “If anything it was so smooth… there were no big bumps. We would have expected more.”

Harmon says “there were no group hugs or anything either,” just that with the right information customers seemed to accept the change and the reasoning behind it. 

 

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