Staff Photo by Dan Henry / The Chattanooga Times Free Press- 5/11/16. James Rains exits the United Grocery Outlet store off of Highway 58 on Wednesday, May 11, 2016 which has recently expanded its produce and meat departments. United Grocery Outlet
The store specializes in liquidations, close-outs and irregular merchandise to keep prices down. It also focuses on handling inventory imbalances, packaging changes, factory seconds, and trial-run products, though it carries a variety of national brands.
Company at a glance
› Name: United Grocery Outlet, also branded as Bargain Barn Inc.› Headquarters: Athens, Tenn.› Store locations: 24 in Tennesee, nine in western North Carolina and one each in Kentucky, Georgia and Alabama› Founded: 1974› CEO: Michael Tullock› Web site: http://myugo.com
When Michael Tullock started his first grocery store as a senior in high school in 1974, he had no idea the venture would grow into what now is 36 units in Tennessee and four nearby states.
“I was in a distributive education program [in Etowah, Tenn]. I did it in the corner of my parents’ antique shop and it kept growing,” Tullock said at his United Grocery Outlet on Highway 58 in Chattanooga.
On Wednesday, the company president and store employees unveiled a $100,000 expansion and revamp of the Chattanooga market.
The store, now about 26,000 square feet in size, added more produce and bulked up its meats section, which Tullock said is the best-performing among all his units, which sit mostly in East Tennessee and also in Georgia, Alabama, North Carolina and Kentucky.
He said he’s looking for a second Chattanooga location “on the other side of the river,” but he hasn’t found one yet that fits the grocer’s low-cost business model.
United Grocery specializes in liquidations, close-outs and irregular merchandise to keep prices down. It focuses on handling inventory imbalances, packaging changes, factory seconds, and trial run products, though it carries a variety of national brands.
Still, the markets aren’t full-line grocery stores, Tullock said of the business that has 800 employees, with some 25 in Chattanooga.
“We’re an extra stop for a lot of people,” he said. Four of his stores don’t carry meat or produce, Tullock said.
This year, he expects sales across the business to grow about 8 percent, though he declined to give revenue figures companywide. When the nation’s economy went into recession in 2008, he said United Grocery saw a lot of people who’d never before shopped the grocer.
“Everybody likes saving money,” Tullock said.
Darlene Rogers of Chattanooga said outside the Highway 58 store that she shops there regularly because she likes the bargains.
“I like the meats. Bread is cheap. Everybody is friendly,” she said, adding that she buys most of her groceries at the market.
The company tries to keep its stores within about 200 miles of its Athens, Tenn., headquarters and distribution center, allowing truck drivers to make deliveries without having to spend the night out of town.
Enlarging the distribution center is planned, which will permit the grocer to continue to grow, Tullock said.
“I hope to get started this summer,” he said. “We really need to get more space in Athens.”
Tullock, 59, said while the company continues to look at more locations in the future, he doesn’t have a goal.
“We’re not in a mode where we have to add stores,” he said. “That’s a good place to be.”
But, Tullock said, growth presents opportunities for employees to move up in the organization.
“If you stop growing, people will leave,” the businessman said.
Tullock noted that the company, which operates under Bargain Barn Inc., marked its 40th year in 2014. He recalled his parents encouraged him and his brothers to each get into their own businesses and they helped him along the way.
“They let me make mistakes,” Tullock added. “So I learned from them.”
Contact Mike Pare at mpare@timesfreepress.com or 423-757-6318.