CSG Industry Experts:

Natasha Perry

Apparel & Department

Brian List

Grocery & C-store

Arthur Rosenberg

Home, Hardware, & Discount

Linda Helman


Rebecca Ewing

Drug, & HBC


Our panel of Industry Experts and authors of CSG Through The Ages, brings you this year’s series: Recession Busters

Businesses need vision, strategy, and the right leadership to find success even in a tough economy.

Using the vast CSG database of historical data and inside knowledge of each industry, our expert panelists have followed the trends for the last decade and selected the Top 10 companies in each segment that survived the recession.

Each month we reveal a top company that weathered the storm. We will examine what they did, how they did it, and where they are going in the future.

Apparel & Department Store Retailers


Crocs, Inc. is a manufacturer, distributor and retailer of “Crocs”, a foam clog shoe for men, women and children. Crocs can be found at department stores, sporting goods retailers, company-owned stores and kiosks, and online. The comfortable footwear is made in multiple styles and colors and offered at an affordable price.

Since its inception in 2002, Crocs Inc. has sold more than 200 million pairs of shoes in more than 90 countries around the world. The first model produced was unveiled at the Ft. Lauderdale Boat Show. All 200 pairs produced at that time sold out immediately. The comfy shoe brand soon became a household name.

Crocs Inc. is a true recession buster. Starting in 2006, sales of Crocs began to soar. First-quarter sales tripled from 2006 to 2007. The company completed several acquisitions and began to grow quickly. From 2006 to 2008, the company acquired Jibbitz (Crocs’ clip-on charms), footwear maker Ocean Minded, and golf shoe manufacturer Bite Footwear.

In late 2009, the company changed marketing direction, away from fashion and towards comfort and support. The company claims the specially designed foam forms itself to a wearer’s feet and offers medical benefits. Crocs Inc. holds a patent covering various utility aspects of its footwear.

Crocs is a brand that the entire family can enjoy. The footwear trend caught on quickly and continued to grow. The company offered fun, affordable footwear that also provided comfort and support. Licensing agreements with companies like Disney and major sports teams, along with several company acquisitions helped to catapult company sales. The brand celebrated reaching $1 billion in annual sales in 2011. With over $1.19 billion in sales last year, the company doesn’t seem to be slowing down.

Discount, Dollar, & Hardware Retailers


In preparing for companies worthy of discussion in Chain Store Guide’s series on recession busters, the first company which came to mind from the CSG database of Home Center Operators & Hardware Chains was Tractor Supply Co. Most of the denizens of this industry were pretty much decimated by the effects of the double whammy of the subprime crisis followed by the disastrous economic climate resulting from the recession. In fact, there is hardly an area in this market which produced encouraging results through this extended period of economic turmoil framed by the recession.

Actually, Tractor Supply’s performance during the recession was stronger than its track record showed a decade earlier, during an era of fairly unprecedented growth enjoyed by most of this industry. Much of the basis behind Tractor Supply’s recessionary performance was not so much a result of measures taken as a reaction to the recession but more from a well-planned agenda carefully constructed more than a decade earlier.

It was then that the company’s board of directors undertook to determine the company’s long term goals through a plan designed to better connect with the company’s loyal customer base while seeking to appeal to additional demographics. These comprehensive meetings ultimately altered the company’s merchandising mix and adjusted its real estate priorities.

A major result of these meetings was to add to its focus a new type of customer, the weekend/gentleman rancher. This was seen to be a newly emerging, more affluent demographic. Seeking this demographic was an inspiration to augment the merchandising plan. One of the most notable of several merchandising changes was in terms of apparel, especially outerwear. The new mix here proved to be most popular to the family youth market. When the recession hit, this stylish, practical and well-priced gear continued to draw customers, especially ever-growing youth.

For Tractor Supply, the 90’s were a decade of consistently encouraging, moderate growth. By 2002 the company’s store count nearly tripled to 435 from just ten years before. By the end of 2013 that count had grown to 1,276. Corporate sales for 1991 were reported at $215 million. Annual sales for 2001 came in at barely under $850 million. A year later sales grew to over $1.2 billion. Tractor Supply reported annual sales for 2013 to be over $5 billion.

Through all the subprime/recession laden years, the weakest year for store growth showed a net increase in store count of 75 additional locations in 2009. Corporate sales increases mirrored this, with the smallest annual increase of just under $200,000 for 2009, the first announced year of the recession. These recession era figures are sensational for any business, more so for a retailer and even more stunning for any company residing in the CSG database of Home Center Operators & Hardware Chains.

Drug Store & HBC Chains


Founded in 1990, Ulta has become one of the fastest growing beauty retailers in the United States. Since 2007 sales have grown from $755.1 million to $2.67 billion. With the guidance of then CEO Lyn Kirby, they began a competitive growth strategy in 1999 and have grown from 196 stores at the beginning of 2007, to 675 stores by 2014. Their growth can be attributed to their strong foundation, fill rate strategy, and customer loyalty program.

Ulta’s company motto focuses on the four E’s: Escape, Education, Entertainment and Esthetics. They have always aimed to be the one stop shop that carries not only makeup, but also hair care products, salon styling tools, skin care products, fragrance’s, private label products, a full service salon, and boutique areas where customers can experiment, play, and learn about different makeup options. Another reason for Ulta’s growth through the recession is their customer loyalty program. In 2008 there were 6 million program members; by 2011 this number had grown to 8 million, and today there are over 13 million loyalty customers. While Ulta has had three different loyalty customer programs, one thing has stayed the same: the quality and abundance of promotional products. Today Ulta carries over 20,000 products, has 30 trademark names, offers more than 500 brands, is open seven days a week at off mall locations, and has a competitive e-commerce site and marketing strategy. While Ulta has adapted new Omnichannel initiatives and had three different CEO’s since 2007, its strength lies in its foundation and consistency.

The true behind the scenes reason for their success lies within their fill rate strategy. Ulta runs off an open-to-buy plan, which is updated weekly with POS data, receipts, inventory levels, and is issued to balance buying opportunities and return on inventory investments. The company believes this not only helps capitalize on buying opportunities, but also maintains financial control. The POS data strategy is used to calculate sales forecasts, determine replenishment levels and promotional products, and to keep stores productive and up-to-date. Through using this strategy, Ulta makes sure to have a 95% fill rate of all products at all times, presenting consistently high quality.

In the past seven years it is almost amazing how true to the brand Ulta has been. Today they employ over 19,500 full and part time employees and have net sales of $2.67 billion. In the next 10 years they hope to have over 1,200 stores across the US. At the rate they have been growing there is no doubt that this powerhouse will continue to see success.


Grocery & C-Store Chains


Along with previous recession buster supermarket chains in this space, Whole Foods Market has capitalized on the healthy eating and natural/organic product craze that swept through America the past decade. However, the company also needs to be recognized as a pioneer in bringing organic product offerings to its mainstream supermarket shelves. Ironically, the company dubbed ‘Whole Paycheck’ has experienced tremendous growth throughout the recent recession. Even though most consumers were trading down and shopping more at big-box stores for food, Whole Foods has found a unique food retailing niche and taken it mainstream. Led by its visionary Co-Founder and Co-CEO John Mackey, the company has created a culture fueled by sustainable agriculture, healthy eating, and community involvement.

The Austin, TX-based supermarket retailer’s total sales have grown from $7.9 billion to $12.9 billion since 2008, good for a 62% growth clip. In addition to offering a unique selection of product lines underneath one roof compared to most other supermarkets, Whole Foods has created a distinctive store experience combining traditional grocery offerings with a new take on perishable departments and freshly prepared foods. Food courts are lined with homemade pizza stations, fresh food by the pound, smoothie stations, as well as olive and cheese bars. Ground bison and natural Angus beef lines meat cases, while rows of fresh produce and herbs fill the center store next to dry grocery departments. Single-handedly, this has propelled growth throughout the recession even when price was a top priority for many food buyers. More modestly, unit growth stood at 32% from fiscal 2008 through fiscal 2013. The company continues to grow both domestically and overseas, with a goal of 500 stores by 2017. Long term, it believes the U.S. has the potential for 1,200 Whole Foods Markets.

The company’s controversial 2007 acquisition of main competitor Wild Oats Inc. significantly increased its size prior to the start of the recession. The deal spent months going through regulatory approval and had major opposition from the Federal Trade Commission on anti-competitive grounds. Ultimately, the deal was approved after Whole Foods sold a portion of the acquired stores to other parties.

Restaurant Chains


Founded in 2005, Pinkberry was a pioneer in the introduction of frozen yogurt to the American consumer. Starting with fewer than forty locations at the end of 2008, the company ended 2013 with nearly 250 stores worldwide. In addition to more than 150 domestic locations in 27 states at the end of last year, there are an additional 100 Pinkberry outposts in the Middle East, United Kingdom, Peru, Canada, Russia, Turkey, Philippines, India, and the Dominican Republic.

It was started by Korean-born Hye Kyung “Shelly” Hwang and her business partner Young Lee. The product is Shelly’s proprietary recipe, and in early days there were only two flavors available: Original and Green Tea. Within a year of opening, the tiny 600-square-foot store was serving 1,300-1,600 customers per day. The menu since has evolved, and while the Original is still available every day, seasonal flavor changes are made several times a year; current options include Mango, Grapefruit, and Coconut. The fresh fruit toppings are also seasonal, dry toppings include nuts and granola, and liquid toppings allow consumers to enjoy caramel, honey, chocolate, and other sweet additions.

Pinkberry was given an early boost by its many celebrity fans, including Paris Hilton and Ellen DeGeneres. A Facebook page shows such well-known personalities as Dustin Hoffman, Rob Lowe, Leonardo Dicaprio, and Selena Gomez enjoying the frozen treat. Its tart flavor distinguishes it from the more commonly-found frozen custard, and the healthy low-caloric treat appeals to those who want to eat their sweets without feeling guilty. Its success has spawned a number of competitive fro-yo chains such as Red Mango, Orange Leaf, Sweet Frog, and Yogurtland.

The company was acquired in 2010 by venture capital fund Maveron LLC, co-founded by Starbucks Chairman/CEO Howard Schultz. Growth has been primarily through franchising (fewer than 20 stores are corporately operated) and international expansion. Ronald Graves has been at the helm of the organization since early 2008, providing a continuous management style and vision.