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Lakota Thrifty Mart posts enviable sales

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EAGLE BUTTE, S.D. - Nearly a decade ago the Cheyenne River Sioux tribal leaders decided to take a leap of faith and establish a tribally owned grocery store - a venture some suggested would fail.

But after a few years of refining its operations, the Lakota Thrifty Mart is a state-of-the-art grocery store offering its patrons nearly everything they might find in at an urban grocery retailer.

The enterprise was fueled by the tribe's desire to provide an employment resource for tribal members, fuel economic development and retain a valuable service to tribal members.

General Manager Bernie LaPlante said Chairman Gregg Bourland felt there were tribal members who, "if given the opportunity, could run it successfully with support from the tribe."

Lynn Fiest had operated the store in its original location for nearly 20 years under a lease agreement with the tribe. But tribal leaders, who saw little progress in employment opportunities for tribal members, decided employment prospects and management opportunities would be greater with a tribally owned store.

In December 1991, the tribe terminated its lease with Fiest and established the Cheyenne River Grocery Marketing Corp. and the Lakota Thrifty Mart. The store had 6,500 square feet of floor space and the building was well more than 30 years old.

In June 1994, the Lakota Thrift Mart moved to a new 17,500-square-foot building across the street and is now part of a retail and business plaza. When the store opened it had 32 employees, nine of them full-time. It employs nearly 60 people and more than 90 percent of its work force are tribal members, LaPlante said.

The tribe invested nearly $200,000 and used a grant to take over the store. Bourland and the council terminated the lease because they felt that Fiest failed to live up to a promise of employing and training tribal members at the store, a condition of the lease.

Tribal leaders were looking for ways to bring change for Cheyenne River's labor force, diversity in its economic development and a way to retain a valuable service to tribal members, LaPlante said.

"Tribal leaders wanted to offer a place of employment with competitive wages and benefits."

In addition, the store brought in a tidy profit for the tribe and a welcoming gathering place for shoppers.

The average sales per week have steadily increased. In 1993, the store grossed nearly $56,000 a week. By 1996, it was bringing in nearly $83,000 a week and last year, the store grossed nearly $108,000 a week last year.

Because of its phenomenal performance and outstanding sales record, it is ranked as one of the top independent stores supplied by the Nash Finch Co.

It has been featured in national trade publications as an example of how a tribally-owned grocery store has been successful in an ever-changing marketplace.

The store has outgrown two locations and it is outgrowing its present facility. In 1998, a full-service bakery department was added.

While expansion is in the planning stages, LaPlante said, an even larger building will be needed in the future.

"We've already outgrown this store and we're ready to make a move. We've seen increased sales every year we have been in business."

LaPlante, who has managed the store since it opened under tribal ownership, said many were wary of how long it might endure, but even with some growing pains the store continued to net a profit for the tribe.

The strategies, he said, were simple - a solid organizational structure, gaining name recognition and using progressive marketing techniques to bring shoppers to the aisles.

"We did a tremendous amount of advertising. We did everything we could to get our name out there. We wanted Indian country to know we were tribal owned and operated," he said.

The early years weren't without frustration and while the first five years returned gains in profits, LaPlante said growth was stymied by a board that micro-managed the operation and made it difficult for the store to keep up with inventory and marketing trends.

Under the original board, LaPlante said it found it difficult to manage day-to-day operations and make commitments to venders. Those decisions, he said, had to wait for the board's approval that took nearly a month before anything could be implemented or purchased.

An internal rift between the board and LaPlante eventually led the tribal chairman and the council to dissolve the board, giving LaPlante more responsibility for making decisions about the daily operation and greater flexibility in managing inventory.

The turning point came in 1996 when the board wanted LaPlante fired from the manager's position. After a lengthy meeting, Chairman Bourland, living up to the tribe's commitment to help LaPlante provide stable management, dissolved the board. The store moved under LaPlante' sole management and supervision of the CRST chairman and the tribe's Industrial Business and Development Committee.

"The first five years were real good, but we weren't able to grow like I felt we should. We were under a board that was structurally wrong," LaPlante said.

The store even met with resistance from tribal members who had their doubts, but as time went on it began to reclaim a market of shoppers.

"We had tribal members who didn't want the store to change hands. We had non members who were very supportive," he said.

"At one time, we were really losing a lot of business to border towns like Mobridge, Gettysburg, Pierre, even Rapid City and Sturgis. Since we built the new store we were able to reclaim it," LaPlante said.

Part of the success is credited to Nash Finch, its wholesale supplier, because the company assisted the tribe with management and provided training for LaPlante when the tribe took over.

The wholesaler helped the store regroup after Fiest's lease expired. Despite an executive search, the tribe couldn't lure a manager to live in Eagle Butte even though it offered a competitive salary.

"When we took over, they came in and helped us with the transition. They loaned us a corporate manager until we found a manager," LaPlante said. The wholesaler offered LaPlante training in an executive development program designed for its corporate employees. At the time, the company offered the same training course to retailers.

LaPlante entered the three-year program, attending annual two-week training sessions in Brainerd, Minn. The sessions, he said, sharpened his skills to effectively meet demands of marketing and stock the shelves while gauging trends for new product lines offered by venders.

"There was a very small window of opportunity," he said.

The training was accelerated and rigorous. Just 15 of the 25 managers who participated in the training course graduated, he said.

"It was a huge commitment on their part to help their retailers. Nash Finch has grown by leaps and bounds because of their commitment to the independent retailers. They have been a tremendous help," he said.

LaPlante, a Cheyenne River Sioux tribal member who carried bags of groceries for customers at the store when he was a teen, never dreamed as a youth he would be managing a grocery store. He studied for the ministry and took a part-time job at the store to reconnect with people.

Tribal leaders asked him to apply for one of the assistant managers positions because he had skills from working in the various departments. At the time he was the deli-bakery manager for Fiest's operation.

He and all the employees, including managers, were offered jobs by the tribe when the store changed hands.

LaPlante said Fiest tried to prevent the workers from leaving his company, telling them they wouldn't be hired back if they left. He told employees that the tribe had tried in the past and failed miserably, LaPlante said.

"He said, 'Those of you who jump ship remember, just remember that when they come to us and ask us to bail them out and they ask us to take the store back, you won't be hired,"' LaPlante said.

LaPlante said he understood the tribe was taking a risk, but he was willing to do the same.

"I did it with the idea of some day managing the store. I wanted to help the tribe out. Here was the opportunity for me and tribal members to step in," he said.

When the tribe couldn't find a manager, tribal leaders encouraged LaPlante to take the job even though his experience was limited. After talking to his family, he decided to give it a try, asking the chairman and the council for the patience to work through the learning curve.

"I really supported Chairman Bourland. I like his approach. He has a very progressive mind. Here he was stepping out on the limb. I wanted to be a part of it and it was really exciting."

"It's not my business, but I run it like my own. I really take a lot of pride in it and it's tribally owned and operated," said the 41-year-old general manager.

The store has made strides in technology. Computerization has helped LaPlante keep pace with the demands of managing the store. He often checks marketing and retail trends and orders new products using the Internet. Instead of weeks of on the road to trade shows, he can see much of the inventory offered with the click of a mouse.

The store is more than a tribal business venture, LaPlante said. It also functions as a purchasing agent, providing supplies to the various departments of tribal government.

The arrangement allows the tribe to save money on purchases because of the store's volume buying power.

Its state-of-the-art computer systems include a massive database and accounting program that helps him keep up with the store's inventory and the various items each governmental department purchases.

Last year, it upgraded its point of sale program allowing it to accept major credit cards.

LaPlante, whose day is consumed with minute-by-minute decisions, said he loves the challenge of the tribal supermarket.

"This business is so progressive. It is changing every day.

Chairman Bourland said, "There were a lot of people who were upset about that. There were many people who predicted we would be a failure and we were going to be begging Mr. Fiest to come back. Well, that didn't happen.

"We took that store and not only made it a success, but a tremendous success. We're probably close to being one of the top independent Nash Finch stores in the three-state region. We have broken virtually broken all the sales records.

"I attribute the success to a lot of hard work and good management by Mr. LaPlante and some very dedicated and good employees at the Lakota Thrifty Mart," Bourland said.