Albertsons IPO- no status

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pseudo3d
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Re: Albertsons IPO- no status

Post by pseudo3d » September 2nd, 2017, 6:28 am

storewanderer wrote:I wonder if it is difficult to find a buyer for non core assets at this time based on valuations being potentially quite high and there not being a whole lot of potential suitors...

I feel like the grocery sector has already been having an economic downturn the past couple years with all of this deflation...

Yeah, there's really not a lot of choices of what to sell for the highest income with few takers. Most of the dead weight divisions have been disposed of. But again--if they started talking to SuperValu again then it would take pressure off of self-distribution, and did away with annoying Safeway things that still stick around (getting rid of the Albertsons card was an LLC move, and I'm confused why they basically started re-introducing it) it would go in a long way in repairing the company. Finally, continuing paring down stores in the West Coast markets would be advised.

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Re: Albertsons IPO- no status

Post by storewanderer » September 2nd, 2017, 8:48 am

By putting the stores onto Safeway's IT systems and bringing in Safeway's private label programs, they basically turned the stores into Safeways. The stores look like a Safeway, appear to schedule labor like a Safeway, price like a Safeway, and display things like a Safeway.

The variances are Haggen and United who continue to do their own thing and be on their own systems, except they get (some) of the Safeway private label stuff...

What is interesting is this has only happened at some of the Albertsons bannered stores. They are still on the old (Supervalu) systems at Shaw's, Jewel, and Acme... but the TSA with Supervalu is to end in 2019 so I would expect everything to be on Safeway systems by then.

I understand Safeway had the larger store count and its own systems so it probably made logistical sense to go with their systems and private label... problem is the programs are not very good.

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Re: Albertsons IPO- no status

Post by pseudo3d » September 2nd, 2017, 11:49 am

storewanderer wrote:By putting the stores onto Safeway's IT systems and bringing in Safeway's private label programs, they basically turned the stores into Safeways. The stores look like a Safeway, appear to schedule labor like a Safeway, price like a Safeway, and display things like a Safeway.

The variances are Haggen and United who continue to do their own thing and be on their own systems, except they get (some) of the Safeway private label stuff...

What is interesting is this has only happened at some of the Albertsons bannered stores. They are still on the old (Supervalu) systems at Shaw's, Jewel, and Acme... but the TSA with Supervalu is to end in 2019 so I would expect everything to be on Safeway systems by then.

I understand Safeway had the larger store count and its own systems so it probably made logistical sense to go with their systems and private label... problem is the programs are not very good.

Safeway's POS systems aren't good and do weird things like the whole $0.01 coupon thing (do they still do that?), and POS systems can be improved. Why not actually try to take Safeway into the future instead of dragging Albertsons into the past? Whatever stores that are glimmers of hope isn't enough to really take the company into the future.

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rwsandiego
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Re: Albertsons IPO- no status

Post by rwsandiego » September 2nd, 2017, 3:28 pm

storewanderer wrote:By putting the stores onto Safeway's IT systems and bringing in Safeway's private label programs, they basically turned the stores into Safeways. The stores look like a Safeway, appear to schedule labor like a Safeway, price like a Safeway, and display things like a Safeway.

The variances are Haggen and United who continue to do their own thing and be on their own systems, except they get (some) of the Safeway private label stuff...

What is interesting is this has only happened at some of the Albertsons bannered stores. They are still on the old (Supervalu) systems at Shaw's, Jewel, and Acme... but the TSA with Supervalu is to end in 2019 so I would expect everything to be on Safeway systems by then.

I understand Safeway had the larger store count and its own systems so it probably made logistical sense to go with their systems and private label... problem is the programs are not very good.


I've worked on a number of system integrations and conversions during the consolidation of the financial services industry. It is not unheard of to convert to a platform that is already in place when a different platform's service agreement has an expiration date. In the Safeburtson's example, they could upgrade the existing platform or simply replace it once all divisions have converted to it.

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Re: Albertsons IPO- no status

Post by storewanderer » September 3rd, 2017, 7:15 pm

I think with paper coupons they still scan at .01 but none of that shows up if you use the digital coupon via the app.

I suspect once all of the divisions start having to deal with the lousy Safeway systems and other things, we will see changes. We have already seen some changes to the private label program, such as more flexibility on item sizes (for instance until recently, Safeway did not offer private label 1 pound brown/powdered sugar in an effort to get the customer to buy a 2 pound package a tactic also played by Kroger, but not previously played by Albertsons/Supervalu, or, for instance, WinCo or Raleys or Save Mart who all offer 1 pound versions in private label).

It would probably make more sense to get all divisions onto a common system first, then figure out what to do... as it stands now they still run on old LLC systems in a very limited number of stores, the old Supervalu systems in quite a few stores, and the new Safeway system in most stores. Oh and United and Haggen are on different systems than any of them...

I am not clear if they are planning to put United on common systems though. The Albuquerque Albertsons which were on the LLC System have just converted over to the United system, not the Safeway system...

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Re: Albertsons IPO- no status

Post by rwsandiego » September 3rd, 2017, 9:15 pm

storewanderer wrote:...I am not clear if they are planning to put United on common systems though. The Albuquerque Albertsons which were on the LLC System have just converted over to the United system, not the Safeway system...


They might be doing a proof of concept and/or testing the scalability of the United system by converting Albuquerque to it.

You are right - it is easier to convert disparate systems to an older, but known, system than having to create conversion routines from multiple systems to a new, unknown system.

To put this into perspective, it took Bank of America six years to convert a bank it acquired in Chicago to the system it used everywhere else but California. I believe California remained on the legacy BofA systems for almost ten years after the NationsBank merger because legacy Nations did not have the infrastructure to handle the legacy BofA.

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Re: Albertsons IPO- no status

Post by pseudo3d » September 4th, 2017, 6:00 am

In terms of losing money, no grocery stores have been acquired since last year...remember last year they bought several stores including a number of stores from Lawrence Bros. (United), G&G, Paul's, etc. whereas this year they just bought (to my knowledge) "MedCart Specialty Pharmacy" out of Michigan, a definite odd choice if ever there was one.

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Re: Albertsons IPO- no status

Post by rwsandiego » September 4th, 2017, 11:38 am

pseudo3d wrote:In terms of losing money, no grocery stores have been acquired since last year...remember last year they bought several stores including a number of stores from Lawrence Bros. (United), G&G, Paul's, etc. whereas this year they just bought (to my knowledge) "MedCart Specialty Pharmacy" out of Michigan, a definite odd choice if ever there was one.


MediCart might not be as odd as one would think. As insurers push their members who use specialty meds (think HIV/AIDS, cancer treatments, Truvada as PrEP) to specialty pharmacies retail pharmacies lose out on that business. However, if Albertsons has a specialty meds company that offers the patient the convenience of in-store pickup at the grocery store while offering insurers the cost savings of a dedicated specialty pharmacy they have an advantage over competitors who don't offer these services. Additionally, Kroger has had its own pharmacy benefits management company (PBM) and specialty pharmacy for years.

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