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Frank Budwey selling last Budwey's to owner of Market in the Square

After a lifetime in the grocery business, Frank Budwey will sell his North Tonawanda supermarket and retire from the industry. Market in the Square, an independent grocer with one location in West Seneca, hopes to take over by Oct.1.

"It's bittersweet. My employees are like family. We grew up together," said Budwey, whose family started Budwey's Market in 1922. "But there comes a time in life you just have to let go."

Budwey made international headlines two years ago when he effectively gifted minority ownership of the store to his full-time employees, giving them 49 percent ownership of the company's stock.

Budwey said he will break even with the sale but, since there's no profit, employee stock will no longer have any value and workers will lose any ownership interest. Proceeds from the sale will pay off debt, including $1 million of Budwey's own money that went into the recent store remodel.

"Unfortunately there's not a payout because there wasn't an opportunity to sell at a markup," Budwey said. "I couldn't find an operator who would overpay."

The way sales were going, it was only a matter of time before the stock became useless anyway, Budwey said. If the right buyer hadn't been found, the store was on track to fail altogether. Bringing in Market in the Square was the best shot at keeping the store open and keeping workers employed, he said.

Frank Budwey, left, talks to Jordan Swanson, 11; her grandfather, George Rodriguez; and Audrey Goral at Budweys Market. (John Hickey/Buffalo News)

Budwey had banked on his $1 million remodeling investment to increase sales by 10 to 15 percent as it had in the past. Instead, sales stayed flat.

With a longtime general manager retiring next year, an important supervisor preparing to retire soon after, and the difficult, low-margin grocery business experiencing a major disruption with online grocery shopping and delivery, Budwey knew it was time to go. In the face of having to start again in a vastly changed marketplace, he made Market in the Square owner Brian Kusmierski "an offer he couldn't refuse."

"It's time for me to step down and let the young people handle the changes. I've seen enough changes," he said.

Kusmierski's son Nick and his daughter Danielle Hastings both work for the company, and he's trying to persuade another daughter, Erin Toney, to come on board as well.

Budwey had been trying to sell the store since 2009, when his son and business heir Justin unexpectedly died. He sold his stores in Newfane and on Kenmore Avenue that he had bought specifically to broaden his son's holdings, but he wasn't confident any of the potential buyers for the North Tonawanda store would be able to keep his hometown store running.

That was until he persuaded Kusmierski to make a deal. The two owners are similar in their deep grocery backgrounds and their stores' go-to-market strategies, which emphasize high-quality meat, produce and bakery departments. Both stores are small, family-owned operations that have loyal customer bases. Both use Olean Wholesale Grocery Co-op and sell the Shurfine brand. And both are known for their doughnuts.

Having an additional store will help Market in the Square find efficiencies in operation costs and give it more buying power with vendors, he said.

It will be business as usual for Budwey's at first, the new owner said, but Kusmierski will eventually begin bringing the best of both stores together, he said. There are no plans to change the way the doughnuts at Budwey's are made.

Kusmierski had always envisioned Market in the Square to be like a combination of the Broadway Market and the once-beloved Park Edge grocery chain, where he started his career and which was bought by Bells Markets in 1979. The store sells many Polish specialties, which will also make their way to the North Tonawanda location.

Budwey's employees were surprised to hear the news about the sale, and many full-timers were disappointed that their time as grocery owners would come to an end. Still, most understood that Frank had gone out of his way to find a grocer that would keep them employed, rather than selling to the highest bidder or closing, said meat manager Jerry Dumais.

Dumais began working at Budwey's 30 years ago when his father, a Budwey's meat cutter, died. With the family suddenly missing its breadwinner, Budwey trained Dumais to take over his father's position.

"Frank has done a lot of things for a lot of people. He tried with the employee ownership, but it just didn't work out," Dumais said. "If he wasn't the kind of guy to look out for his employees, he would've sold a long time ago. Most people would've walked away and said, 'Good luck.' "

Frank Budwey took over the family grocery business in 1972. (John Hickey/Buffalo News)

Budwey's employees will be able to cash out their accrued vacation time and holidays if they're not used by Oct. 1. Market in the Square employs 140 people and will hire Budwey's 134 people to run the North Tonawanda store.

Budwey, known for greeting his customers by name, said he will still visit the store often. He'll keep his office, which is down the hall from the store. But he said it's most important to him that the employees, who have become like extended family for many customers, will remain and keep doing what they do best.

"Our people aren't trained to ask, 'Did you find everything today? They have their own special connections with their customers,'" he said. "I've seen a woman wait in the longest line just because she wants her favorite cashier. That says you're doing something right. And thank god for that employee."

Each year, for prom, Budwey gives all high school senior employees the Memorial Day weekend off. He likes to give free candy bars or doughnuts to children shopping with their parents. And it can take half an hour for him to walk from one end of the store to other, because so many people stop to hug him hello.

Budwey's Market started in 1922, with Frank's grandmother's store on Oliver Street in North Tonawanda. Frank took over the business after his father died in 1972. He was 23 and fresh out of the Army.

It's hard for him to walk away after all these years. But he has a new wife who travels often for work, and he plans to join her and enjoy his retirement. His sister, a supervisor, and his niece, a bakery manager, will stay on with the Market in the Square.

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