Shortly after the stock market crash of 1929, Charles Hyde and David Vredenburg pooled their meager resources and opened a small general store in the town of Beaconsfield, Iowa. Not knowing of the intensity of the coming economic calamity, the two men rationalized that even in the worst of times people have to eat, so they combined their talents, dreams and fortunes ($1,500 each) to create the beginnings of what later would become a successful corporation.

In 1934, the men set themselves apart from the general store market by discarding products like bolts, shoes, overalls and dresses, and concentrated their retailing operations on food items. As the partnership opened more stores, the operations of their company took on a distinctive character and style. One of the keys to the success to the partnership was the strong belief that good merchandise, good service, good prices and above all else, good people, would make their stores successful. In order to grow, the company welcomed investments from their store managers.

As their operations expanded further, sorting out all of the financial agreements became more and more complex, especially when it came time to pay taxes. In 1937, a collection of managers along with Charlie Hyde and Dave Vredenburg, decided to put everything into one pool by incorporating. The company was operating 15 food stores and had 16 employees as stockholders. After this incorporation, the sale of stock was not limited to their store managers, but any company employee could purchase shares in the company, a policy that has apparently changed.

By the end of its second year, Hyde & Vredenburg, Inc., had 23 stores, 18 in Iowa and 5 in Missouri. These stores went by an assortment of names such as Hyde Stores, Hyde Supply Store, and Vredenburg Service Stores. In September of 1949, the company opened its first “supermarket” in Centerville, Iowa. Every known modern merchandising method was utilized to make the store the finest food shopping center in Iowa. Two firsts were publicly advertised for the new facility: (i) self-serve meats, and (ii) a 100-car off-street parking lot. In addition, an attendant was always on hand at the checkout stands to personally carry out and pack customer’s food purchases into their car.

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New extended store hours were announced for customer convenience from 8 a. m. to 9 p. m. , Monday through Friday, with Saturday remaining the same (8 a. m. to 9 p. m. ). Shortly following the death of Vredenburg in 1952, the board of directors of Vredenburg and Hyde, Inc. , decided to unite the company’s stores under a single name. The company held a contest among store employees to develop a suitable name, with the winner receiving a $100 dollar bill. Store managers where given the privilege of voting on the final name from four semifinalists: Mohawk Food Store, Hy-Vee Food Store, Cornbelt Food Store and Supreme Food Store.

The name Hy-Vee was overwhelmingly chosen with three employees proposing the winner. In the fall of 1952, Hy-Vee opened its first supermarket in Iowa City. Again, the company tried to incorporate every possible new, modern convenience for quick and efficient shopping. All departments in the new store were self-service, aisles were wider, lighting was brighter, and all perishable foods were displayed under constant refrigeration. The store also had the most modern equipment available for customer check-out.

Business grew rapidly, and three years later the store was expanded to over twice its original size. This expansion included the first bakery of any Hy-Vee store, and shortly thereafter, many existing stores were expanded to also include a bakery. Because top employees have always been the foundation of the corporation’s success, the board of directors approved a company-wide, profit sharing plan in 1959. An employee trust fund was established with 25 percent of the company’s net profits before taxes added to the fund each year, and all full time employees could participate in the benefits of the trust.

The fund, managed and invested by three trustees, was intended for the long-range security of Hy-Vee employees to be received upon their resignation or retirement. An employee must complete at least seven years of service to be entitled to his or her total account. This trust fund is yet another way for the company to attract and retain only the best employees to staff Hy-Vee stores. Vredenburg and Hyde, Inc. , sought to diversify the company in June of 1969, by expanding its retailing capabilities and experience into the drug store business.

The company decided to strictly operate “promotional” drug stores rather than conventional stores. Conventional drug stores were smaller, and in addition to a pharmacy, only carried products such as medical supplies and equipment, over the counter health products, and a few lines of beauty aides. Promotional drug stores, however, carried everything a conventional store did but included many other departments: cameras and film, infant items, house wares and small appliances, gifts, books, records, stationary, and more. The company wanted a name for the new stores that was separate from Hy-Vee to give the new chain some originality.

In typical company tradition, Hy-Vee held a contest among its employees to develop a name, with the winner receiving, this time, a one hundred dollar savings bond. After considering names such as “Hy-Drugee”, “Big-V-Drugs”, “Bee Hy-Vee”, a committee decided on the winning name, “Drugtown”. The committee believed the name would reflect the modern, progressive image Hy-Vee wanted to develop for its new chain of stores. Currently, the company operates 24 Drugtowns which, in addition to several departments of non-food items, have complete pharmacies and pharmacists on duty during all open store hours.

On January 3, 1988, the company celebrated its 50th year as a corporation. Hy-Vee celebrated its golden anniversary by doing what it does best, grow. The company entered the state of Kansas for the first time by constructing the largest Hy-Vee store ever built, a 62,656 square foot facility in the town of Leawood. This store was the company’s first “combo”, housing a complete Hy-Vee food store and a Drugtown under one roof. Hy-Vee opened fifteen of these stores during 1989-90, and this hybrid became the store of the eighties, bridging the supermarket growth waves for the company into the nineties.

These stores are big, with at least 60,000 square feet of space. Some think they are too big. However, corporate leaders believe that after a few trips to one of these stores and customers learn were the departments are located, patrons will be amazed at all of the merchandise available to them in one stop, and the size of the store will not matter. A “combo” attracts the working family that, on average, has more money to spend and less time to spend it, which is a social trend in our society that is likely to continue.

In the same amount of time and same distance, in one stop, the family shopper can buy the household essentials, the basic daily or weekly needs and also take care of a few extras. While shoppers buy groceries, a prescription can be filled, laundry and dry cleaning dropped off or picked up, a shoe repaired, cans and bottles redeemed, checks cashed and money deposited or withdrawn at a bank, gardening and lawn products purchased, utility bills paid, packages mailed, stamps or money orders bought, travel or vacation plans made, flowers ordered and delivered, and videos rented.

The company believes that the opening of each new “combo” will likely see a lengthening of the list of perimeter departments ringing customary food and drug merchandise. Indeed, the company defined a “combo” as a combination food and drug store that carries more extensive lines and a broad assortment of products than ordinarily found in either store. However, no matter how big Hy-Vee stores may get, no matter how many employees a store may have (250-400, or more), the company will still hire and retain only the best store employees, making sure to hire people who possess a genuine, sincere friendliness

Currently, Hy-Vee operates a total of 226 retail outlets in seven states, with Ronald D. Pearson serving as chairperson of the board. The organization now ranks among the top 20 grocery chains in the nation and is one of the 50 largest private companies in the world. Retail operations are currently composed of 164 supermarkets, 24 Drugtown stores, as well as 38 Heartland Pantry convenience stores. The corporation prides itself on being Iowa’s largest employer with an operating philosophy constructed on a foundation of honesty and integrity for both employees and customers.


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