With only 12 stores, Fairway Foods is so small it can scarcely be called a regional supermarket chain, but that didn’t stop the company from completing a successful public stock offering on Wednesday.
Shares of Fairway Group Holdings were priced at $13 and after the first day of trading closed at $17.35. Fairway’s sales for the most recent fiscal year were $555 million and the company reported a loss of $11.9 million. However, the company’s stores have a loyal following with 12.7 million transactions conducted during the most recent fiscal year and sales per square foot of nearly $1,900.
Proceeds from the IPO will be used to fund expansion of a 60,000-sq.-ft. suburban format and a 40,000-sq.-ft. urban format.
"From our humble beginnings in 1933 as a small vegetable and fruit stand on a New York City corner, Fairway has developed into a leading food retailing destination in the greater New York City metropolitan area," said Fairway CEO Herb Ruetsch. "We are proud of our achievements and the part we play in supporting the communities that we serve. We look forward to building on our success by continuing to serve our customers with great food, great service and value."
The company’s expansion plans for the next several years will focus on the greater New York area where it enjoys some brand awareness and looks to open three to four units annually in suburban locations. Over time, the company indicated it will pursue growth in other high density markets in the northeast which it believes can support 90 stores. Longer term plans call for 300 units nationwide.