Magazine

The Wizard Of Odd


James O. Bonaminio is an independent grocer with a capital "I." Today, if the mood strikes, Bonaminio might put on his wizard suit and roller-skate through his Jungle Jim's International Market performing "price magic." Or perhaps he'll go off "junking" for a few hours, returning with a ton or two of bargain-priced salvage that he eventually will incorporate into his sprawling, 280,000-square-foot supermarket in Fairfield, Ohio -- just like he did with the animatronic Robin Hood, the 40,000 blocks of wood extracted from highway guardrails, and the monorail recycled from an amusement-park ride.

Jungle Jim's might well be America's wackiest supermarket, but there is method to Bonaminio's madness. Instead of trying to beat the big chains at their price-squeezing game, Bonaminio has built a funhouse maze of a store north of Cincinnati that draws 50,000 shoppers a week from as far away as Indianapolis and Lexington, Ky. "The Jungle" is not all fun and frivolity; its other defining trait is a huge selection of specialty foods from 75 countries. Sales totaled $63.5 million in 2004, up from $29.8 million in 1995 -- not bad for a college dropout who got his start in 1971 selling produce from a roadside stand. (Bonaminio says he turns a profit, but he won't disclose numbers.)

Jungle Jim's is as unique as a fingerprint, but it typifies retailing today in one respect: Its future is threatened by the relentless expansion of Wal-Mart Stores Inc. ((WMT)) "People say, 'don't worry about Wal-Mart, you are unique.' Bullshit!" declares Bonaminio, a physically imposing 55-year-old with the lantern jaw of a comic-book superhero. "Independents are different, man; you can't ever let your guard down."

Wal-Mart has been slow to move into Cincinnati, in part because the city is home to Kroger Co. (KR), the largest U.S. supermarket chain. Last September, though, the discounter opened the first of what is expected to be about 15 megastores ringing Cincinnati. "I see Wal-Mart going from nothing to a 25% to 30% market share in four years," says David B. Birdsall, the Midwestern development chief of Regency Centers Corp. (REG), which owns a dozen shopping centers in greater Cincinnati, including one that is anchored by that just-completed Wal-Mart Supercenter.

SLOWING GROWTH

Kroger, Meijer, Bigg's, and Cincinnati's other established grocers are about two years into a fierce struggle to try to add market share before Wal-Mart starts taking it away. Jungle Jim's dual emphasis on shopping-as-entertainment and specialty foods has insulated it from the price wars, but only to a degree. While Bonaminio makes most of his profit on high-margin specialty foods, he derives the bulk of his revenue from the same staples that every supermarket offers. Jungle Jim's growth has slowed markedly of late. Revenues have risen by 3.8% a year on average since 2002, compared with 11.4% from 1995 through 2001.

The looming prospect of being sandwiched between two Wal-Mart Supercenters about 10 miles apart has roused Bonaminio to bold action. He is risking much of the profit he has accumulated on a $10 million project to transform his store into a retail campus he calls "Foodieland." And on Apr. 1, Bonaminio signed a letter of intent to open a second store. The 75,000 sq. ft. supermarket -- tentatively named Baby Jungle -- will be a 30-minute drive from the Fairfield store, moving Bonaminio close to the heart of Cincinnati.

Jungle Jim's has prospered to date not because of its location but despite it, in defiance of the first rule of retailing. The store is four miles from the nearest major highway, and a long stretch of traffic hell separates it from Cincinnati proper. Even so, Bonaminio never seriously considered relocating even as his business began to expand.

His store is an amalgam of a dozen buildings constructed one after the other and joined together under one very complicated roof. Built largely of recycled materials, Jungle Jim's is filled with novel design touches that Bonaminio delights in showing off: the antique fire engine resting atop a case holding 1,200 kinds of hot sauce; the mint-condition 1919 Boar's Head truck in the deli section; the faux Portopotty doors that open into spacious bathrooms; and on and on.

Bonaminio put his Foodieland plan in motion a few years ago, and it is about half realized. Next to the store he recently built a two-story "events center" for tastings, televised cooking demonstrations, and food and wine festivals. Within the new building is a large space that Bonaminio hopes to let to a restaurant operator. He's also looking to lure a hotel chain to his 71-acre property. "There are golf destinations all over America where you fly in and spend the weekend," Bonaminio says. "That's what I'm trying to do with Foodieland -- create a campus with things for foodies to do when they're not shopping the store."

Even as Bonaminio hopes to create a more tempting destination for gourmet and ethnic shoppers, he also is trying to make Jungle Jim's the kind of place where locals will stop in to buy a loaf of bread on their way home from work. Recently he moved his vast beer and wine selection from the front of the store into a new wing. This in turn freed the prime space in the store's center to be remodeled into what is essentially a conventional supermarket within a sprawling specialty store. Here, Bonaminio has collected in one place the everyday items formerly scattered through the rear of the store.

PLANTS, STAMPS, LATTE

Bonaminio also is counting on the allure of one-stop shopping to ring the cash register. He has added a garden center outside the front entrance and leased space just inside it to a U.S. Post Office, a Fifth Third Bank branch, a Starbuck's (SBUX), and a pharmacy. Bonaminio just broke ground on a shopping center next to the Jungle with room for a dozen restaurants and stores. Most of its 65,000 square feet already have been leased. "Such a huge number of people come through Jungle Jim's that if we just pick off 10% of them, we will make money hand over fist," says Brian Gillan, CEO of Buck$ Dollar Stores, a small Cincinnati chain.

Foodieland's most distinctive feature -- a two-mile monorail -- will connect the far reaches of Jungle Jim's parking lot to various entrances when it begins operating in 2006. Bonaminio picked up eight trains from an area amusement park for just $1 in 1998 but has spent $1 million upgrading them and installing track. Part of what finally persuaded him to open a second store was the chance to adapt an old machine-tool warehouse for retail use. With the building comes a secondhand treasure to rival the monorail: a 25-ton crane. It's staying.

The consensus in Cincinnati retailing and real estate circles is that Wal-Mart's inevitable market share gains are unlikely to come at Bonaminio's expense. "Jungle seems wacky on the outside, but he has a consumer brilliance about him," says Robert Smyjunas Jr., president of Cincinnati developer Vandercar Holdings Inc., which has been trying for years to entice Bonaminio into one of its projects. "He really understands his market."

For his part, Bonaminio is taking nothing for granted. "Nobody's doing what I'm doing, and I don't know if I'm going to be able to do it," Bonaminio says. "Ask me in a year." Whatever happens, America's most independent grocer no doubt will continue to do his own thing -- and have fun doing it.

By Anthony Bianco in Fairfield, Ohio


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