Jewel-Osco to start offering online ordering, new boss says

Jewel-Osco’s new president says that by the end of summer shoppers will be able to order groceries online from the Chicago area’s largest supermarket chain.

Doug Cygan sees that as a logical next step for Jewel-Osco, which got its start 118 years ago as a horse-and-wagon food-delivery service and supplied food for online grocer Peapod for a decade in the 1990s. Peapod started sourcing from wholesalers 17 years ago to save money.

“Everything comes full circle in this business,” said Cygan, 54, who has been working for Jewel for 36 years, starting out part-time as a teenager helping customers put groceries in their cars in his native Mundelein.

He steadily worked his way into bigger roles with the 186-store, Itasca-based chain, which operates in Illinois, Indiana and Iowa and has more than 31,000 employees. Most recently vice president of marketing and merchandising, he was named president last week, succeeding Mike Withers, who was promoted to executive vice president of retail operations for Jewel’s parent company, Albertsons Cos., based in Boise, Idaho.

Darren Seifer, a food and beverage industry analyst with The NPD Group, said traditional grocers like Jewel are facing “a paradigm shift” in staying up to date, as shoppers “have more retail channels and options, like prepared foods and meal-kit delivery services, than ever before.”

Jewel-Osco’s e-commerce offering will be rolled out starting early this summer and be completed by summer’s end, according to Cygan, who would not provide details on how it will work.

Cygan — a 1981 graduate of Mundelein High School who’s on the board of his college alma mater, Western Michigan University — and his wife Shonna have a combined family of six children ages 16 to 26. ”Like ‘The Brady Bunch,’ ” he said — three girls and three boys — but with no “Alice,” the TV show’s live-in housekeeper.

In an interview, Cygan also said:

• The Jewel-Osco slated to open next year at 61st Street and Cottage Grove Avenue in Woodlawn will feature a drive-through pharmacy and full-fledged drugstore, as well as the grocer’s organic and natural food options, meat-processing and cutting on site and ready-to-eat hot meals.

• The store slated to open June 27 at Clark and Division streets in Old Town will have an upstairs bar and seating area where people can order food.

• Jewel-Osco continues to look for new store sites and will step up its existing store remodels from 18 this year to 25 next year. The company has remodeled 114 stores in the past four years.

Cygan said he sees his role as ensuring Jewel-Osco continues for another 100 years by staying “hungry and humble.”

Grocery industry analyst David Livingston, managing partner of DLJ Research, said that, even though Amazon and other online grocers’ 1 percent to 2 percent market share might seem insignificant, it’s enough to have kept brick-and-mortar supermarket chains from having positive same-store sales.

Still, Livingston said, “Jewel is in a good position. Kroger is struggling to maintain sales volumes at Mariano’s. Strack & Van Til is selling out and closing stores; Jewel might end up with some. Walmart and Meijer have closed some smaller stores in Chicago. Central Grocers, the largest area wholesaler, is financially distressed. What more could Jewel ask for?”