Inside the $400 Million Family-Run Supermarket That Helped Launch Martha Stewart and Paul Newman
Stew Leonard’s, America’s most entertaining retailer, chose to grow slowly to preserve its family-friendly, quirky personality.
Editor’s note: This tour of small businesses across the country highlights the imagination, diversity, and resilience of American enterprise.
Stew Leonard Jr. seeks glory in 4,000 pounds of Wisconsin cheddar. At the East Meadow, New York, outpost of the Leonard family’s eponymous supermarket, a cheese carverrecently sculpted the two-ton dairy product into the shape of a rock engraved with the company’s governing principles. Rule #1: The Customer Is Always Right. Rule #2: If the Customer Is Ever Wrong, Reread Rule #1.
“We are going to enter it into the Guinness Book of World Records,” Leonard Jr. says. “And we are going to win: largest cheese carving!”
If the cheddar triumphs, it would be the company’s second entry in the book. The first was for sales per square foot. That was in 1992, the year after Stew Leonard’s opened its second store, in Danbury, Connecticut. The company, with close to $400 million in sales, has since expanded to six locations in its home state of Connecticut and in New York. (A store in Paramus, New Jersey, opens next fall.) At every outlet, customers are greeted by the customer-first policy, carved into actual rock, rather than cheese.
Stew Leonard’s is famous for marching to its own drummer, which likely as not is a cow playing bongos. The nearly century-old family business is a pioneer in experiential retailing: Chuck E. Cheese’s meets Whole Foods. Costumed characters like Wow the Cow and Stewie the Duck roam the aisles. Animatronic musical acts include the Hank & Bo Show (a canine country jamboree) and a quintet of singing milk cartons. “We’re the Farm Fresh Five. How do you do? We have plenty of fresh food for you,” croons Leonard Jr., sampling the cartons’ repertoire.
Stew Leonard’s was also an early stomping ground for regional food celebrities. As a caterer in the late 1970s and early ’80s, Martha Stewart plied the aisles. Paul Newman turned to Stew Leonard Sr. for help launching his salad dressing. Frank Perdue personally sold the store trailer-loads of chicken he couldn’t move in New York City.
Mostly, though, Stew Leonard’s is a magnet for families. It hosts crafts and cooking classes for kids, glow-in-the-dark dance parties, and a “trunk or treat” event at Halloween with a long line of customers handing out candy from the trunks of their cars. The Stew Leonard III Water Safety Foundation provides 10,000 free or low-cost swimming lessons to children every year.
Fiona Sanzo has been shopping at Stew Leonard’s Yonkers’s store once or twice a week since the first day it opened, in 1999. And while her 14-year-old son has aged out of some of the entertainment, her 9-year-old daughter still loves to watch the dancing chickens and bananas. The family also attends birthday parties and book signings at Stew Leonard’s, as well as Halloween hayrides and movie nights. “We’re like, ‘It’s that time of year again.’ We have to go to Stew Leonard’s for this or that event,” says Sanzo. “Those are traditions.”
Trucks gotta moo
At first, it was just a dairy. In the early 1920s, Charles Leonard started Clover Farms to pasteurize, bottle, and deliver milk in Norwalk, Connecticut. Thirty years later, his son, Stew Leonard Sr., made the pedestrian playful by adding fiberglass cow heads to the family’s growing fleet of trucks, and installing mooing horns.
When a new highway threatened the dairy in the late ’60s, Leonard Sr. decided to add retail to supplement the declining delivery business. The business flourished as local farmers offered up first corn, then tomatoes, squash, peppers, and onions. Fresh seafood was the next logical step, reflecting Norwalk’s reputation, since the 1800s, as “oyster capital of the world.” Leonard Sr. bought beef from cattle farms in the Midwest; soon he was selling ground chuck, alongside his wife’s meatballs and meatloaf. After a sojourn in Paris, Leonard Jr.’s sister created a namesake section (Bethy’s Bakery) with breads, pastries, and croissants. “The whole concept was buy direct, sell it at a great price, keep it fresh,” says Leonard Jr.
A story underlies virtually every signature feature of Stew Leonard’s. Take, for example, the odd serpentine path that customers follow through the building. In the first store, a single aisle looped like a horseshoe from front to back to front. Then Leonard Sr. began buying adjacent houses — more than 20 in all — and connecting them to the building. As the space morphed from a simple square into a constellation of irregular protuberances, the aisle rerouted along with it, creating the labyrinth.
The Customer Is Right rock dates to the ’70s, not long after Leonard Sr. succeeded his father as CEO. A customer complained about funny-tasting eggnog, and Leonard Sr. argued with her. Finally, he handed her a dollar out of his pocket. She flounced out vowing never to return. “My father said, ‘You know, I am trying to attract customers and I just lost one,’” Leonard Jr. says.”’I should have just given her the buck and told her she was right, that the eggnog was off.’” Leonard Sr. posted the two rules on a sign out front. Later, a local monument company chiseled them into stone.
Even the company name has an origin story. A couple of Harvard Business School grads came by to study the business when it was still called Clover Farms and then launched a virtual replica — Mill Pond Farm — 20 miles away. When Leonard Sr. complained, they warned him they could change their name to Clover Farms since he owned no copyright. Leonard Sr. investigated and learned more than 60 Clover Farms operated around the country. He changed the name to Stew Leonard’s Clover Farms and, two years later, to Stew Leonard’s, which he copyrighted. The competitors’ store failed.
That’s entertainment
The Leonard family has always worked together (four of Leonard Sr.’s children and three of his grandchildren are in the business). They’ve also played together, including frequent vacations to Disney World and Las Vegas. The whimsy of Disney and the showmanship of Vegas inspired much of the Stew Leonard’s ethos.
“Disney is where the costumed characters came from,” Leonard Jr. says. “From Vegas, we got the theatrics. One time, we came back and put up white lights all over the building. When we opened our store in Yonkers, we put a big waterfall right in the lobby.” Disney is also the source of Stew Leonard’s approach to leadership and customer relations. Around 50 executives and managers have attended the Disney Institute in Florida to study subjects like delivering quality service and setting employee expectations. The company has been a perennial on best-places-to-work lists.
But the Stew Leonard’s story is not without shadows. In 1993, Leonard Sr. was sentenced to prison after pleading guilty to skimming money from the Norwalk store in what was, at the time, the largest computer-based case in the United States. Following his conviction, sales dropped by 5 to 10 percent. “We got torpedoed from all sides at once,” Leonard Jr. says. “On the business front, there was a lot of negative publicity. And it was a tough time for the family. We had to hold hands and stay strong.”
Sales rebounded 12 to 18 months after the press coverage died down and have been growing since. Stew Leonard’s Wines and Spirits — 10 stores independently owned and operated by family members — launched in 1999. They are more sedate than the food markets (no singing grapes) but have been similarly successful, comprising 20 percent of sales.
The creamed spinach principle
Given the stores’ enduring regional popularity, it’s somewhat surprising Stew Leonard’s don’t carpet the country. “I don’t know if you gain a lot from growing,” Leonard Jr. says. “The things we’ve always loved, like being on the floor talking to customers. Knowing all your team members’ names. Helping them in difficult times. You can’t do that when you have too many people.”
Leonard Jr. has more satisfying uses for his time than plotting world domination. One recent Saturday, for example, a customer at the Norwalk location told him that the store’s homemade creamed spinach paled beside Peter Luger’s creamed spinach, which Stew Leonard’s also sells. “I had never tasted Peter Luger’s,” Leonard Jr. says. “So I did a little taste test with a group of our people, and guess what? Peter Luger’s is like twice as good as ours!”
Leonard Jr. asked staff to collect creamed spinach samples from all over and scheduled a giant taste test with the goal of identifying the best and improving the store’s own recipe. “Our goal was never to be the biggest. It was to be the best,” Leonard Jr. says. “These are the things you do to make business better all the time.”
