Winn-Dixie continues Down Down (the drain?)

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Re: Winn-Dixie continues Down Down (the drain?)

Post by pseudo3d »

storewanderer wrote:Publix is very well priced compared to, say, any west coast Safeway or Albertsons. But they are higher than what you would see at a Kroger (or a Wal Mart) in most other states down south. I have also noticed they engage in some very heavy zone pricing so it may be the locations you are going to are priced higher.

The problem Winn Dixie has is they were stuck in the trap of increasing prices to make up for falling customer counts. This is a horrible strategy and what they are doing with "Down Down" (and the fact they have actually stuck to "Down Down" for a year which is amazing to me given how often this company seems to keep changing strategy the past few years) is a slow attempt to reverse that. It will take years to fix their pricing but if they can slowly rebuild their business, it will work. They need to rebuild business, rebuild their perimeters and restock them, get more labor in the stores which is paid for by increasing sales and customer counts, etc. Is it working? Who knows.

I also agree Wal Mart's prices are really not that low at all. I was in there tonight and numerous items I was looking to purchase; packaged meat, milk, eggs, bread, produce, were all at everyday prices 15-20% higher than Smiths and ina couple cases a little bit higher priced than Safeway would be for a comparable item, though in other cases still 1/2 the Safeway price. So it does vary depending what competitor you are talking. I would guess Wal Mart is generally comfortably 10-20% below Winn Dixie's typical pricing (likely higher than the Down Down prices).

Down Down is a small subset of items. It reminds me of the preliminary stages of Kroger's price cutting program (Right Store Right Price) about 10-12 years ago. This is how it went. Started with a few items, then a few more, then a few more, then a few more... items came and went from it from time to time. Over time it got them a working strategy to be very competitively priced (below Wal Mart now, back then that was who they were trying to cut prices to the level of) on a pretty good number of popular items.
Kroger probably had a better time of it not just in the fact that they probably better financially equipped to do so, but they had far more stores (and thus, greater volume). The Ralphs division alone probably had more stores than Winn-Dixie's base in Florida today (~450 in 1999 to 370-pre conversion, not to mention Southwest (about 300 stores, even back then) with other Kroger stores more than making up the difference. And of course, on their way to be competitive with Walmart, Kroger completely demolished Albertsons as a viable arch-rival (Albertsons' major shrinking happened during this era).
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Re: Winn-Dixie continues Down Down (the drain?)

Post by storewanderer »

I agree Kroger was in a better position. They also had their manufacturing plants to help supply products that they could cut prices on.

Maybe it is too late. To me it is impressive they have stuck to this strategy for a year... when was the last time they stuck to any given strategy for that long?

Is Down Down even implemented in all stores? Last spring it was implemented in Orlando and Jacksonville but when I went up to Bi Los in the Carolinas and a Harvey's somewhere (what a joke that was), it was not implemented.
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Re: Winn-Dixie continues Down Down (the drain?)

Post by wnetmacman »

storewanderer wrote:Is Down Down even implemented in all stores? Last spring it was implemented in Orlando and Jacksonville but when I went up to Bi Los in the Carolinas and a Harvey's somewhere (what a joke that was), it was not implemented.
I don't know about Bi-Lo, but it is throughout Winn-Dixie. Even the westernmost stores in Louisiana are doing it.
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Re: Winn-Dixie continues Down Down (the drain?)

Post by pseudo3d »

If Yelp is any indication, Fresco y Mas just seems to be turning off people.

Like the first review for the first FyM, here's another choice bit from Cristina L. (from photo appears to be Hispanic, the "target demographic"):
I came here on its grand opening with my family. First thing you notice, bright yellow everywhere. We loved coming here before becauseit was traditional. There are plenty of Hispanic supermarkets like Sedano's that caters to the Hispanic community. I am not sure why Winn dixie removed its name, though. The layout is the same, weekly circular, ect. There's a cafe area which used to be the Deli section. It's the same Winn Dixie store just revamped but not for the better. Our cashier was horrible. She was too busy gossiping with the bag boy. She was unprofessional and rude. Nope, there is no point to return. We will stick with Winn dixie on SW 8th St. Sure the customer service sucks but at least you are not forced to squint at the hideous bright yellow while you are shopping.
It hits all the major points, the yellow is awful, they're turning off their remaining loyal customers, it's not a big improvement, and the market is already crowded with stuff like Sedano's anyway.

Meanwhile, the first closure of the year has already hit SEG, the victim being a BI-LO (to say nothing of the 20 or so pharmacy closures in the last few months).

Additionally, I thought I read in a recent article that part of the appeal of "Down Down" was so Winn-Dixie could offer competitive low-end prices while still being a full-service grocer (unlike Aldi/Save-a-Lot, and often Walmart). But if you cut out the pharmacy (or any of the other full-service departments), then you're undermining that and there's no real reason to go to Winn-Dixie over Walmart.
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Re: Winn-Dixie continues Down Down (the drain?)

Post by storewanderer »

I would assume the stores where pharmacy has closed will end up closing outright. That is what typically happens...

But sometimes this is not the case. Stater Bros. has closed pharmacy in some stores and the stores stayed open.

Sometimes it is just not profitable to keep pharmacies open for one reason or another and some of these chains that are more mindful of their financials/operating closer to breakeven, make the decision to eliminate pharmacy.
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Re: Winn-Dixie continues Down Down (the drain?)

Post by pseudo3d »

Well, apparently according to another article Winn-Dixie sales have improved, particularly on the Down Down items, so maybe all is not wrong with the new direction. However, the one non-spam comment correctly points out that the Harveys conversions seem to be on racial lines and not on low income (and the implication that all blacks are low-income), which I had noted about a month ago. Doubtful that a "class action lawsuit" will occur, but that's not the best way for publicity.
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Re: Winn-Dixie continues Down Down (the drain?)

Post by wnetmacman »

pseudo3d wrote:Well, apparently according to another article Winn-Dixie sales have improved, particularly on the Down Down items, so maybe all is not wrong with the new direction. However, the one non-spam comment correctly points out that the Harveys conversions seem to be on racial lines and not on low income (and the implication that all blacks are low-income), which I had noted about a month ago. Doubtful that a "class action lawsuit" will occur, but that's not the best way for publicity.
Think of it this way:

Would Whole Foods go into an economically distressed area? Would Saks or Macy's put a store there? No. Winn Dixie has changed its format in the areas where the economy stipulates that one of their full-line "high end" stores would not be profitable, but where a lease is in full force. So why not 'dumb down' these stores where they might make a slightly better profit instead? I've seen many companies do this. Kroger with Food 4 Less and Barney's, Safeway with Pak & Save, Minyard with Carnival (when they were still a decent company), Brookshire with Super 1 Foods, Brookshire Brothers with Price Chopper, A&P with a good number of brands, and the list goes on.

Sometimes you have to go against traditional thinking and do something different. WD's old mantra was 'keep charging the same higher price and giving less'. In today's economy, you have to do something different. WD is at least trying something different.
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Re: Winn-Dixie continues Down Down (the drain?)

Post by Knight »

pseudo3d wrote: Meanwhile, the first closure of the year has already hit SEG, the victim being a BI-LO (to say nothing of the 20 or so pharmacy closures in the last few months).

Additionally, I thought I read in a recent article that part of the appeal of "Down Down" was so Winn-Dixie could offer competitive low-end prices while still being a full-service grocer (unlike Aldi/Save-a-Lot, and often Walmart). But if you cut out the pharmacy (or any of the other full-service departments), then you're undermining that and there's no real reason to go to Winn-Dixie over Walmart.
BI-LO #5101, Mount Pleasant Square, 1440 Ben Sawyer Boulevard, Mount Pleasant, South Carolina 29464-4536, has been a lame store for several years. Its closing is not a surprise as service departments have closed, guest services are discontinued, associates have transferred to other stores, and hours of operation are reduced.

BI-LO #5410, 774 South Shelmore Boulevard, Mount Pleasant, South Carolina 29464-6656, is in the process of closing. I have not heard when BI-LO #5410 is projected to close.

Southeastern Grocers have given plenty of reasons for customers to shop at Walmart or other competitors rather than BI-LO, Fresco y Más, Harvey's Supermarket, and Winn-Dixie. Increasing already high prices and taking out service departments are two reasons toward closing stores.
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Re: Winn-Dixie continues Down Down (the drain?)

Post by pseudo3d »

wnetmacman wrote:
pseudo3d wrote:Well, apparently according to another article Winn-Dixie sales have improved, particularly on the Down Down items, so maybe all is not wrong with the new direction. However, the one non-spam comment correctly points out that the Harveys conversions seem to be on racial lines and not on low income (and the implication that all blacks are low-income), which I had noted about a month ago. Doubtful that a "class action lawsuit" will occur, but that's not the best way for publicity.
Think of it this way:

Would Whole Foods go into an economically distressed area? Would Saks or Macy's put a store there? No. Winn Dixie has changed its format in the areas where the economy stipulates that one of their full-line "high end" stores would not be profitable, but where a lease is in full force. So why not 'dumb down' these stores where they might make a slightly better profit instead? I've seen many companies do this. Kroger with Food 4 Less and Barney's, Safeway with Pak & Save, Minyard with Carnival (when they were still a decent company), Brookshire with Super 1 Foods, Brookshire Brothers with Price Chopper, A&P with a good number of brands, and the list goes on.

Sometimes you have to go against traditional thinking and do something different. WD's old mantra was 'keep charging the same higher price and giving less'. In today's economy, you have to do something different. WD is at least trying something different.
Well, it's not that specifically, it's the whole theme that the "low-income" name happens to be the same place in non-white areas, and although many stores do have the "lower end" store brand, there's not enough correlation where it looks like stores are being "racially profiled" (where the Harveys in Jacksonville are ALL in one quarter of the city...). H-E-B for instance doesn't have that problem (even though it does have Joe V's and Mi Tienda). Besides, Winn-Dixie isn't exactly high-end as is, so comparing it to Saks and Whole Foods is laughable.

For Winn-Dixie pre-2005, SaveRite was their idea to save their "dog" stores where they were able to put up a new name, strip out the perishables, and market it as a warehouse store without specifically equating race, merchandise mix, and income levels.
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Re: Winn-Dixie continues Down Down (the drain?)

Post by pseudo3d »

Well, the Winn-Dixie and Southern Home brands appear to be not long for this world...

Looks like SEG is rolling out a "SE Grocers" brand. Not sure what to think of it, but it like the Albertsons Cos., seems to not think highly of the individual store brands.

http://albertsonsfloridablog.blogspot.c ... brand.html
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