wnetmacman wrote:
Executed properly, Bi-Lo would have worked well, because by the time the two merged, they didn't really overlap, thus putting both back into areas they had each operated before. Because neither chain was particularly in good health, it hasn't brought, as Wall Street likes to say, the 'proper synergies' that it should have.
Buying Sweetbay was like the blind leading the blind. There was no waiting on the conversion; we already knew it didn't work, but replacing Sweetbay with Winn Dixie was like trying to put a fire out with gasoline. It went from being Delhaize's failure to another, being Winn Dixie. When a chain doesn't even understand their home base, it's scary to think that they operate other places also.
BI-LO/Winn-Dixie was perhaps one of the worst supermarket mergers in recent history, because while they were similar operations without overlap, neither of them had much to bring to the table. The Albertsons/Safeway merger was a bit of a long shot as both companies had significant problems, but both had something to bring to the table. The end result was that Albertsons was able to get a huge combined market share in the West Coast while also getting market shares in a number of key urban areas including Philadelphia, Chicago, and Houston. Safeway also brought its manufacturing line along.
BI-LO/Winn-Dixie, on the other hand, did not have nearly those strengths. The 2005 bankruptcy of Winn-Dixie had caused their manufacturing practices (except for Chek) to fold as their entire private label line essentially vanished. BI-LO had gone bankrupt two years prior, neither chain had a great market share hold on anything in the entire region, and weren't even that ambitious about what they planned to do then, or do now. When your top marketing woman believes "
it's better to be disliked than to be forgotten" you've got significant problems (also note in the article that the "Down Down" campaign has severely cut into the advertising budget).
Sweetbay's conversion was incredibly poorly handled, even from reading about it. Unlike A&P and ACME, SEG owned Sweetbay, so they could've taken their sweet(bay) time converting everything to Winn-Dixie without springing the name on until well after the fact. After all, when Winn-Dixie bought Jitney Jungle back in 2000, they took about
9 months to convert everything and finally switch over to the Winn-Dixie name. There was no need to wait 5 days for reopening (especially since you aren't even changing out décor), which is a lot of lost income, then they didn't even offer anything as to why Winn-Dixie was better than Sweetbay (ACME advertised lower prices and its improved perishable departments, Winn-Dixie didn't do more than "Well, the mustard's in the same place"). In short, a disaster.