Southeastern Grocers refocusing Harvey's Supermarket banner

[veteran+]

Apparently about a week ago, SEG converted over 70 Winn-Dixie and BI-LO stores into Harveys, including six in Jacksonville alone, literally overnight [http://www.winn-dixie.com/about/press]. I guess in some respects it may be a way to purge dated stores from the chain as they try to remake the stores' images, but to me, sets off a lot of warning bells when a chain tries to do something like this.

With not nearly the amount of remodels SEG was supposed to do on Winn-Dixie, I'm starting to think that SEG doing a round of sales or closings is a very real possibility. With Mississippi only having 14 stores and the continued decay of Winn-Dixie stores west of the Mississippi River, I can see a forecoming scenario where Winn-Dixie's stores only go so far as mid-Alabama with a tiny island of Winn-Dixie stores in New Orleans that will last as long as the rest of the chain does.

I believe your predilection on this is very likely.

Side note:

What do you think of the look of the interiors of these stores?

I find them to be extremely garish, to put it mildly. Very uncomfortable milieu (for me) to shop in.

[rwsandiego]

Based on the pics, it looks like a lemonade tsunami

[pseudo3d]

Apparently about a week ago, SEG converted over 70 Winn-Dixie and BI-LO stores into Harveys, including six in Jacksonville alone, literally overnight [http://www.winn-dixie.com/about/press]. I guess in some respects it may be a way to purge dated stores from the chain as they try to remake the stores' images, but to me, sets off a lot of warning bells when a chain tries to do something like this.

With not nearly the amount of remodels SEG was supposed to do on Winn-Dixie, I'm starting to think that SEG doing a round of sales or closings is a very real possibility. With Mississippi only having 14 stores and the continued decay of Winn-Dixie stores west of the Mississippi River, I can see a forecoming scenario where Winn-Dixie's stores only go so far as mid-Alabama with a tiny island of Winn-Dixie stores in New Orleans that will last as long as the rest of the chain does.

I believe your predilection on this is very likely.

Side note:

What do you think of the look of the interiors of these stores?

I find them to be extremely garish, to put it mildly. Very uncomfortable milieu (for me) to shop in.

Looks basically like the Fresco y Mas decor, which to me is yucky. Plus, studies have shown that babies cry more when exposed to bright yellow rooms, and given that Harveys is trying to appeal to lower-income families (who likely have babies), they'll actually likely be more crying babies in the stores.

I've been told third hand that operation hours are being cut and pharmacies are closing. I don't think that the Harveys conversions will save the chain, and if anything just make it worse, especially in Jacksonville, Florida, where the Winn-Dixie name is much well known. That is pretty much the absolute sin of any grocery chain, if you cannot make it in your own hometown and command a decent market share (if not the top market share by a long run), then you're finished. The good news is that SEG wasn't dumb enough to convert Winn-Dixie stores en masse to Harveys. Personally, here's my prediction for SEG's next move:

1. SEG will remodel a handful of Winn-Dixie stores. They likely won't look as nice, think late-era Lifestyle remodels.
2. SEG announces it will pull out of North Carolina (or at the very least, most of NC), Mississippi (central MS, looks like most of the Winn-Dixies extant are on the Gulf Coast), and west of the Mississippi River entirely. To cut losses, viable stores will be sold to competitors.
3. SEG will retire the BI-LO name in favor of Winn-Dixie to save on branding costs.

[Knight]

pseudo3d, you are right about stores having pharmacies closed and hours reduced. Those are two signs stores are preparing to close or are closing.

I noticed several Winn-Dixie pharmacies in Florida and Louisiana have closed. Thirteen BI-LO pharmacies (1 in Georgia, 5 in North Carolina, 7 in South Carolina) have closed, and one affected store recently converted to Harvey's Supermarket.

I am not optimistic of Southeastern Grocers' future. It is declining quickly like A&P. Possible moves:

• Exits from Louisiana, Mississippi, and North Carolina
• Sale of quality stores to a competitor increasing store count and market share
• Closing of stores with expiring leases or that have underachieved over a lengthy period

[pseudo3d]

pseudo3d, you are right about stores having pharmacies closed and hours reduced. Those are two signs stores are preparing to close or are closing.

I noticed several Winn-Dixie pharmacies in Florida and Louisiana have closed. Thirteen BI-LO pharmacies (1 in Georgia, 5 in North Carolina, 7 in South Carolina) have closed, and one affected store recently converted to Harvey's Supermarket.

I am not optimistic of Southeastern Grocers' future. It is declining quickly like A&P. Possible moves:

• Exits from Louisiana, Mississippi, and North Carolina
• Sale of quality stores to a competitor increasing store count and market share
• Closing of stores with expiring leases or that have underachieved over a lengthy period

A total exit of Louisiana is unlikely as long as Winn-Dixie still has a major hold in the New Orleans market, and will probably do what A&P did years ago, keeping the "island" as the rest of the chain retreats. Winn-Dixie stores in Baton Rouge are fading, especially as Rouses is really gaining ground, and the store count west of the Mississippi River is also endangered.

Selling the New Orleans market, especially at a deep discount, would speak volumes about Winn-Dixie's decline, personally.

[storewanderer]

I cannot even believe how bad this looks. My expectations with this chain are pretty low. That remodeled Winn Dixie in Jacksonville was a very pleasant surprise and I felt it had promise. Of course they did not stick to that idea at least I have not heard of any more upscale remodels; more recently I was hearing of Fresco y Mas conversions, and now somewhere along the way we are making Harveys which was really at its core just a simple basic clean and sterile low price operator into something with piss yellow walls that looks like a 1990 Food 4 Less.

So let's see, last year we were on an idea to do upscale remodeling on Winn Dixie banner locations (and the one I saw came out great). Next this year we are on Fresco y Mas. Now more recently we are just doing this yellow walled nightmare to Haveys Stores and converting stores in markets that should be Winn Dixie strongholds to this format?

And we are doing this most recent move during the busy holiday season? Not the time for disruptions like this.

[pseudo3d]

I cannot even believe how bad this looks. My expectations with this chain are pretty low. That remodeled Winn Dixie in Jacksonville was a very pleasant surprise and I felt it had promise. Of course they did not stick to that idea at least I have not heard of any more upscale remodels; more recently I was hearing of Fresco y Mas conversions, and now somewhere along the way we are making Harveys which was really at its core just a simple basic clean and sterile low price operator into something with piss yellow walls that looks like a 1990 Food 4 Less.

So let's see, last year we were on an idea to do upscale remodeling on Winn Dixie banner locations (and the one I saw came out great). Next this year we are on Fresco y Mas. Now more recently we are just doing this yellow walled nightmare to Haveys Stores and converting stores in markets that should be Winn Dixie strongholds to this format?

And we are doing this most recent move during the busy holiday season? Not the time for disruptions like this.

According to store locators, the Harveys conversions in Jacksonville are distinctly in the northwest quadrant of the city. Like I said, optimistically, this could be a way to quickly purge the Winn-Dixie name of its worse stores (weren't at least a good one third of the stores that way?) while allowing a passage to remodel Winn-Dixie stores to a more modern model. Winn-Dixie promised 50 of those remodels for 2016 (a door that is fast closing) and even the stores that were remodeled don't look nearly as nice. Gone are the dramatic ceilings and full service departments. The cheapening of this remodel has already begun.

Personal thought is that the Down Down campaign has backfired dramatically by destroying their margins (as if grocery damage from deflation wasn't bad enough). Whatever same store sales bump they're getting isn't enough to offset this, because we know that Publix customers and Walmart customers aren't flocking to Winn-Dixie en masse. While we're on predictions of the (grim) future of SEG, my fourth prediction is that next year, Down Down will essentially disappear and prices will rise back to pre-Down Down levels, while the slogan will still be used on stores and on in-store advertising. Meanwhile, at Harveys, the service departments will start to vanish (Harveys did keep service departments, but mark my words, they're not long for this world). At some point, Lone Star Funds will have had enough of it and offer SEG for sale. It's highly unlikely anyone would take it whole, but Albertsons, Kroger, and Publix all look like they can have something to gain out of it.

[veteran+]

This is what happens when the typical European "retail expert" thinks they can make their mark in an American market.

Their track record is not good (with few exceptions or very long learning curves).

I know the Florida market very well and that is where my retail grocery career started.

This guy's strategy is all wrong and/or TOO LATE, at least for Florida.

W/D failed to fully take advantage of Pantry Pride's exit and allowed Walmart to expand aggressively. On the other side of the aisle, Publix continued fine tuning and expanding. Years of this retail "polarizing" and demographic changes, while W/D barely did anything and lost its identity and reason for being. Consumers were sort of trained to shop at one or the other. No other food retailer gave them a good enough reason to make new choices.

I have friends and family in Tampa, Orlando, Ocala, Tallahassee, Miami, Naples, Jacksonville, W. Palm Beach, Ft. Lauderdale, and more.

They all either shop at Walmart (and complain) for economic or special one trip reasons and most shop at Publix. Even when Albertsons was around and close enough, the choice was usually Publix. I would ask about W/D and it was always, no.

[Knight]

A total exit of Louisiana is unlikely as long as Winn-Dixie still has a major hold in the New Orleans market, and will probably do what A&P did years ago, keeping the "island" as the rest of the chain retreats. Winn-Dixie stores in Baton Rouge are fading, especially as Rouses is really gaining ground, and the store count west of the Mississippi River is also endangered.

Selling the New Orleans market, especially at a deep discount, would speak volumes about Winn-Dixie's decline, personally.

Winn-Dixie's actions in Louisiana may disagree with you. Several Winn-Dixie stores have closed over the years. Pharmacies at underperforming stores have closed recently. I would not consider those actions encouraging to have a major hold in the New Orleans area. Winn-Dixie already has a challenge when Publix moves into Mississippi and Louisiana.

[Knight]

This is what happens when the typical European "retail expert" thinks they can make their mark in an American market.

Their track record is not good (with few exceptions or very long learning curves).

I know the Florida market very well and that is where my retail grocery career started.

This guy's strategy is all wrong and/or TOO LATE, at least for Florida.

W/D failed to fully take advantage of Pantry Pride's exit and allowed Walmart to expand aggressively. On the other side of the aisle, Publix continued fine tuning and expanding. Years of this retail "polarizing" and demographic changes, while W/D barely did anything and lost its identity and reason for being. Consumers were sort of trained to shop at one or the other. No other food retailer gave them a good enough reason to make new choices.

I have friends and family in Tampa, Orlando, Ocala, Tallahassee, Miami, Naples, Jacksonville, W. Palm Beach, Ft. Lauderdale, and more.

They all either shop at Walmart (and complain) for economic or special one trip reasons and most shop at Publix. Even when Albertsons was around and close enough, the choice was usually Publix. I would ask about W/D and it was always, no.

The obvious options for groceries in Florida are supermarkets Publix and Walmart Neighborhood Market and hypermarket Walmart Supercenter. They have likely earned the business of many former Winn-Dixie customers over the years. In the future, Publix will operate more than 800 stores in Florida, and Southeastern Grocers will operate far fewer Winn-Dixie, Harvey's Supermarket and Fresco y Más stores.

I will agree Ian McLeod's strategy is wrong and/or late for Southeastern Grocers.