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Building relationships with providers such as refrigeration contractors is considered by many grocers to be the key to their success. During a recent end-user panel discussion at the Food Marketing Institute’s (FMI’s) 2024 Energy & Store Development Conference in Baltimore, Maryland, food retailers such as Chris Braun, director of construction and facilities at Coburn’s, shared why these relationships are so important.

“Vendors truly need to be partners,” he said. “You have to be able to trust that vendor, to be able to go to them and say, ‘Hey, we have this challenge, how can you help us? What should we do?’ And just have that trust that they're going to take care of you in the best possible way that they can. And to not take advantage of you when it comes to the costs.”

Building Relationships

Trust is key, added Michal Shepard, director of maintenance, energy, and engineering at Harris Teeter.

“You want to have vendors that you can trust, that you can build a relationship with, where you both have mutual interests in bringing a technology or a service to us. And that trust-building is the most important part. We have to learn to trust you, you have to learn to trust us. Sometimes the timing's not right. Sometimes we have budget constraints, but we have to develop that relationship, and that's what's key in this business.”

Once trust is established, the result can be a success for both parties. As Paul Anderson, group vice president of design and engineering at H-E-B, noted, “What I rely on from my consultants, my service providers, my construction partners, is for them to challenge me. Challenge me and make me better. Tell me what I'm not doing right, so we can prove it together, because it's a win-win game. If I win, you win, and if you win, I win.”

DECLINING QUALITY: Paul Anderson from H-E-B expressed concern about the declining quality in the manufacture and installation of refrigeration equipment in new grocery stores. (Courtesy of FMI)

John DeCicco, Jr., executive director and CEO of DeCicco and Sons Markets in New York, agreed, noting, “No one achieves success without the help of others. All of us depend upon one another to do every project together, and when we add technology, we work to make each project more efficient than the last. The trust that we have with the contractors and the providers really makes a difference in making us more successful, which is huge.”

Trust is especially important today, when grocers are in the midst of deciding which low-GWP refrigerants they plan to incorporate into their stores. In many cases, they are looking to their refrigeration contractor partners to be the experts and make suggestions about how they can transition smoothly to the new low-GWP refrigeration architectures.

“We need to rely on them to bring us up to speed on new trends and new technologies and new regulations,” said Braun. “They really need to be those experts, and bring us some ideas on what are some ways that we can work through the regulations, through the cost increases. How can we partner together and make sure that we come up with the best solution possible at the best value?”

Current Concerns

Asked what keeps them up at time, the refrigerant transition and other regulatory changes were at the top of the list for some of the panelists, including Frank Blake, director of facilities and energy at Price Chopper/Market 32.

“I start thinking about all the innovative potential solutions that we've heard about, and then I start thinking, who's going to do all this work?” he said. “We're in an industry where we rely on highly skilled laborers in the refrigeration industry, and it's not enough, and we need more. Then I end up going down that rabbit hole, and both eyes are open, and I’m thinking, ‘Are we not getting more people in the industry because the work's so hard, or is it because the technology's changing too fast, and the folks that have been in the industry for 20-plus years aren't ready, willing, or able to change because of what's in front of them?’”

This ties into Anderson's growing concern about the declining quality in both the manufacture and installation of refrigeration equipment in new grocery stores, which he said is becoming increasingly problematic in the first year of operation.

“So year one, 40% of the challenges in a new store are the work orders and service tickets, which are tied to quality issues coming from manufacturers,” he said. “The next 30% are tied to installation challenges. We've got great commissioning programs out there, and we have great contractors out there. But for some reason, something's changed in the way we construct our stores, and we've got to get our quality systems back to where they once were. After that, 10% or maybe 15% is our store operators. We have to train store operators on what they need to do every day to ensure that these systems continue to operate and minimize disruption for our partners, our customers, and our stores. And the remaining is just basic refrigeration maintenance repair. The stuff's going to break down, and we all know that, because we've been dealing with it for a long time. But the vast majority we need to solve for today, so that we can all get some sleep.”

The future of the industry often weighs heavily on the mind of Anthony Smith, director of Design Source Group (DSG) at Associated Wholesale Grocers.

“Where do we go in the future? Because if I don't take the time to teach someone else some of the things that I know, who's going to help them? At the end of the day, if we have nobody to take over from us, where does this industry go? Where did the retail sector go? Where did the partnership go? Where did the vendor community go? We have to be able to teach the people who are coming behind us something to help them along the way. … This industry is not changing. As we continue to evolve and continue to get more innovative, how do we help the future generations coming behind us?”

New Technologies

When it comes to adopting low-GWP refrigeration technologies, the end-user panelists were well-informed about the available options, with many already utilizing CO₂ systems. However, these systems are easier to install in new stores, which is why grocers struggle with making these retrofits in existing facilities.

“We’re in the upper Midwest, and we're fortunate enough that CO₂ and transcritical CO₂ work well for us,” said Braun. “The thing that we have to try and figure out as these regulations continue to come through is, how do we get our legacy stores compliant? How do we get to the best positions and enterprise we can with the amount of capital that we have? In the past, we haven't had to dedicate a lot of capital towards just refrigeration in order to comply with regulations and keep our costs down. I don't have an answer for that, but that's one of the things that we're trying to work on — balancing how to stay compliant and keep driving towards retrofitting to CO₂ to take advantage of the energy savings that we can see.”

Blake agreed that this is a challenge, noting that “we’re all starting to see the benefit of new stores with CO₂, but what do you do with the thousands of stores that we've built within the last 15 years? They are nowhere near end of life, and we've all invested millions in converting the refrigerants to last week’s most eco-friendly alternatives. We're running out of options. How are we going to allow our stores to continue to operate with some level of financial success?”

No one seemed to have an answer to this question, but maybe they will by next year’s conference, which will be held October 6-9, 2025 at the Town & Country Resort in San Diego, California.