An executive who cut his teeth in corporate America grows disillusioned with big-box stores and buys a local mom-and-pop with the goal of growing it into a large, national concern to compete against the very stores he dislikes.
That might sound a little strange, but Shawn McGhee, proprietor of Hollywood Feed, a pet supply retailer based in Memphis with strong Mississippi ties, is convinced he has struck on a winning business strategy.
“I am looking to create a company that will stand for the ages — the next AutoZone,” McGhee said.
The Hollywood Feed story began some 70 years when a feed store opened on Hollywood Street in mid-town Memphis in the 1950s. Over the course of the next 60 years, the business left the feed business and went into pet supplies, dubbing itself Hollywood Pet Store, while growing to multiple locations.
McGhee would discover Hollywood Pet Store after moving to Memphis as executive vice president with AutoZone. A pet owner, he grew frustrated from the lack of service and quality of products offered by big-box pet supply stores in the Memphis area. Looking for an alternative, he stumbled upon Hollywood Pet Store.
“When I founded Hollywood Feed I had no idea of the history, but I liked the relaxed talkative folks whom you knew you could trust,” McGhee said.
He also found a company in distress. Seeing an opportunity to use his background in national retailing, McGhee purchased six stores and a warehouse in 2006 and renamed the company Hollywood Feed.
His idea — to grow the company’s footprint nationally while maintaining a small-store feel — has paid dividends. Hollywood Feed’s services now not only include pet food/snacks, but also grooming, toys, apparel, vaccinations, training classes and pet adoptions. Today, the company has locations in Alabama (four), Arkansas (three), Tennessee (11) and Mississippi.
Hollywood Feed, which focuses exclusively on dog and cat products and services, opened its first Mississippi location five years ago in Olive Branch and has subsequently established stores in Oxford, Ridgeland and Flowood with more on the planning table.
But the Mississippi connection has evolved beyond retailing.
Hollywood Feed once offered pet beds from a company run part-time by a couple of Jackson residents. Deciding to get out of the business, the owners approached McGhee about buying their existing inventory a couple of years ago.
“I told them yes, but I was also interested in their business, the pet bed manufacturing process,” McGhee remembered.
This led the Hollywood Feed team to Northeast Mississippi to look at prospective manufacturers to make its pet beds. The company would eventually choose a Verona cut-and-sew operation as its partner, receiving its first big load of beds in September 2012.
McGhee said the Verona plant made sense because its trucks running between Memphis and Huntsville, Ala., could pick up the pet beds, which carry “Mississippi Made Products” on the label, for distribution to its stores.
He added that his team felt good that they could give the Verona economy a boost. Cut-and-sew operations in the region have been negatively impacted by offshoring, and the jobs are important to the community.
“When our team at Hollywood Feed set out to create a line of dog beds, we wanted them made right here at home,” McGhee said in one of Hollywood Feed’s TV ads. “I was told no one manufactures in the U.S. any more — that it was crazy. We can make the beds cheaper in China, but that’s not who we are…our commitment to creating local jobs is strong. People in this area needed work, and we had a tall order for them — great dog beds manufactured in the very neighborhoods we serve.”
Now, Hollywood Feed is looking to take that community-focused philosophy and its strategy of giving customers a small-store experience to the national level. The company’s goal is to open 25 stores over the next 10 years, and Hollywood Feed, which employs roughly 150 workers across its locations, is currently looking at more sites in the greater Jackson area for retail locations. The company is also exploring Texas and the Dallas market as well as more stores in Birmingham, Ala., and Memphis.
It follows the trend at Hollywood Feed. Since McGhee purchased the company, it has seen a growth rate of between 40 percent and 50 percent annually, and the company’s pet bed business
“We are essentially doubling in size every two years. It has been a fun ride,” McGhee said.“
For more on Hollywood Feed, visit www.hollywoodfeed.com.