Re: Supervalu to sell Shop 'n Save
Posted: September 19th, 2018, 7:34 am
I agree that Schnucks may have been the only bidder. Dierbergs, the other local operator, wouldn’t want that many stores. Kroger probably doesn’t want to explain to analysts why it would be buying so much real estate given its current Restock plan, and a format that is clearly a fixer-upper. Hy-Vee wouldn’t buy the operations outright because they are a non-union, employee-owned format. They don’t want to inherit the union employee contracts.
To me, it looks like Schnucks purchased most of the better locations that weren’t directly across the street from one of their own stores. However, several of these are extremely close to current Schnucks locations. I can guarantee that in 90% of the cases, the Schnucks store is in much better operating condition as well.
Schnucks has a perception in St. Louis of being more expensive than SNS, however I don’t think that’s the case any longer. SNS, like the Shoppers and Farm Fresh formats of Supervalu, have moved more traditional than the no-frills concept they originally started as. SNS stores have a strong center-store operation, however their deli and produce are not the quality that today’s shopper is looking for. The stores are very plain. They were the low-price leader until Walmart, Ruler(Kroger) and Aldi really made a big push in the last ten years.
I doubt that anyone will take most of the remaining stores to operate as traditional supermarkets. Schnucks purchased the ones on the Illinois side that Kroger might want. If Hy-Vee entered the market, it’d be in St. Charles County (NW part of the area) that is closest to their stores in Central MO. Schnucks picked up all of those too, I believe. Besides, I think Hy-Vee is focused on the Twin Cities at the moment.
It will be interesting to see how much money Schnucks will invest in these new stores. They’re going to need a lot of work to look like a Schnucks.
To me, it looks like Schnucks purchased most of the better locations that weren’t directly across the street from one of their own stores. However, several of these are extremely close to current Schnucks locations. I can guarantee that in 90% of the cases, the Schnucks store is in much better operating condition as well.
Schnucks has a perception in St. Louis of being more expensive than SNS, however I don’t think that’s the case any longer. SNS, like the Shoppers and Farm Fresh formats of Supervalu, have moved more traditional than the no-frills concept they originally started as. SNS stores have a strong center-store operation, however their deli and produce are not the quality that today’s shopper is looking for. The stores are very plain. They were the low-price leader until Walmart, Ruler(Kroger) and Aldi really made a big push in the last ten years.
I doubt that anyone will take most of the remaining stores to operate as traditional supermarkets. Schnucks purchased the ones on the Illinois side that Kroger might want. If Hy-Vee entered the market, it’d be in St. Charles County (NW part of the area) that is closest to their stores in Central MO. Schnucks picked up all of those too, I believe. Besides, I think Hy-Vee is focused on the Twin Cities at the moment.
It will be interesting to see how much money Schnucks will invest in these new stores. They’re going to need a lot of work to look like a Schnucks.