HEB started small. What started as a family-owned business has now become the fifth-largest privately held company in the United States.
DALLAS — HEB is a grocery store synonymous with Texas, but it’s only in the past few years that the chain has begun to expand into the DFW metro area.
Ahead of a ribbon-cutting ceremony marking the opening of the grocer’s newest location in Mansfield, Texas, on Wednesday, and the planned opening of at least nine more stores over the next few years, we took a look back at the 119-year history of the beloved Texas grocery store chain.
Who is the Founder of HEB?
Many people know that HEB stands for Howard E. Butt, who is widely considered to be the founder of the grocery store chain. However, contrary to popular belief, it was Howard’s mother, Florence Butt, who opened the first HEB store.
Florence Butt was born in Buena Vista, Mississippi in 1864. She later married Clarence C. Butt, a pharmacist, and had three sons.
The family lived in Memphis, Tennessee, until Clarence Butt contracted tuberculosis in 1904. After his diagnosis, the Butts severed their ties to Tennessee and moved to San Antonio in the hopes that the dry climate would help Clarence’s illness. A year later, the family moved again, this time to Kerrville, Texas.
In 1905, with her husband no longer able to work, Florence Butt raised $60 in groceries and opened CC Butt Grocery Store on the first floor of their Kerrville home.
She ran the store until 1919, when her son Howard took over.
When did HEB become HEB?
As a child, Howard Butt helped his mother deliver groceries to customers by wagon, and during his high school years he even helped run the family store. But after graduating in 1914, he set his sights elsewhere, in California.
Butt hitchhiked to California, where he worked as a grape picker, but his stay on the West Coast was short-lived, as he soon enlisted in the Navy to serve in World War I. Before enlisting, he took the middle name Edward.
Batt returned home from military service and finally took over the family business in 1919. Returning to Kerrville, Batt partnered with his mother to run the family store, switching the business model to a self-service grocery store in 1921. (Prior to the opening of the Piggly Wiggly in Memphis in 1916, most grocery stores, including CC Batt Grocery, used the “charge and deliver” system.)
In 1926, the family-owned store expanded for the first time in South Texas with a second location in Del Rio, and the chain continued to grow from there.
In 1928, Butt borrowed $38,000 (about $800,000 today) to open three more stores in the Rio Grande Valley, near the U.S.-Mexico border.
From there, the chain expanded rapidly, expanding to Corpus Christi, Austin, and San Antonio within 11 years, around which time the company’s headquarters moved to Corpus Christi.
In 1935, Butt changed the name to H.E. Butt Grocery.
By 1946, he finally officially shortened it to HEB.
From grocery stores to supermarkets
HEB responded to change by opening its first “supermarket” in 1952. At the time, it was a novelty to have a baker, butcher and pharmacist all in the same place.
This transformation has allowed HEB to quickly grow into the largest grocery store in South and Central Texas.
In 1985, the chain officially moved its headquarters to San Antonio, where it remains today.
In 1997, HEB opened its first store outside the U.S. in Monterrey, Mexico. Today, the chain has more than 50 stores south of the border and in 2012 generated more than $1 billion in annual sales in Mexico.
Gold gold gold
Currently, HEB operates more than 420 stores throughout Texas and Mexico.
However, not all of those stores are HE-B.
The chain actually operates five different brands: HEB Store, HEB Plus, Central Market, Mi Tienda, and Joe V’s Smart Shop. Every store caters to a different market.
HEB Plus stores operate like modern supermarkets, offering supermarket items as well as electronics and other non-traditional products.
Central Market typically caters to more upscale shoppers willing to spend money on higher quality ingredients.
Mi Tienda offers shoppers a traditional Mexican grocery store experience, including fresh tortillas and pan dulce made in-store daily.
Meanwhile, Joe V’s Smart Shop offers a budget-friendly shopping experience with low-priced ingredients.
According to Forbes, HEB is projected to make $43.6 billion in 2023. This makes it the fifth-largest privately held company in the U.S. (Just two places above Publix, another regionally significant grocer).
Forbes magazine also reports that the Bhatt family is the 20th richest family in the country, as they own an estimated 90% of the grocery chain’s stock.
Their wealth is likely only growing: After 119 years in Texas, HEB only recently began expanding into Dallas-Fort Worth, which the U.S. Census Bureau estimates has a population of 8.1 million, making it the most populous metropolitan area in Texas and the fastest-growing in the country.
There are high hopes among North Texans as HEB continues to expand into the region. If the Texas-based grocer captures a significant share of the DFW market, it could soon become one of the top three wealthiest private companies.
