Executive change at Acme reflects integration issues

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cathandler
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Executive change at Acme reflects integration issues

Postby cathandler » June 21st, 2017, 2:34 pm

The ex-A&P stores are an ongoing drag on Acme, which has otherwise been one of the bright spots at Albertsons. But is it already too late to turn them around?
http://www.supermarketnews.com/executiv ... wheel-acme

storewanderer
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Re: Executive change at Acme reflects integration issues

Postby storewanderer » June 21st, 2017, 9:00 pm

Jim Perkins was put in charge of Acme right after Supervalu when Acme was rumored to be at the brink of closing (based on my observations of Acme, I never really felt the situation was as dire as it was being made out to be but there were certainly problems) and it seems under his leadership things really turned around at Acme.

This is a pretty important market for them. One they should be successful in. They are not competing against Kroger there, either, which makes things easier for them.

The ex-A&P Stores may have already been so broken that moving in Acme with high prices and transitional challenges was just too much. I haven't seen the stores so I am not in a place to comment much. But if they were to get stronger on price, I suspect customers would overlook other perceived shortfalls. But price is one thing that Albertsons seems to be very arrogant and clueless about and continues with its highest in market pricing strategy all over the place. Loss leader ads only get you so far. You need fair pricing on other items to impulse sell at least an extra item or two to the cherry pickers.

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Re: Executive change at Acme reflects integration issues

Postby klkla » June 22nd, 2017, 1:46 pm

I checked out Acme's Yelp reviews for the stores acquired in New York and they're horrible. They did an awful job explaining to customers what Acme is and how their stores are better than the A&P brands they replaced. It sounds like service and price execution has been horrible, as well.

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Re: Executive change at Acme reflects integration issues

Postby mbz321 » June 22nd, 2017, 9:13 pm

storewanderer wrote:Jim Perkins was put in charge of Acme right after Supervalu when Acme was rumored to be at the brink of closing (based on my observations of Acme, I never really felt the situation was as dire as it was being made out to be but there were certainly problems) and it seems under his leadership things really turned around at Acme.

This is a pretty important market for them. One they should be successful in. They are not competing against Kroger there, either, which makes things easier for them.

The ex-A&P Stores may have already been so broken that moving in Acme with high prices and transitional challenges was just too much. I haven't seen the stores so I am not in a place to comment much. But if they were to get stronger on price, I suspect customers would overlook other perceived shortfalls. But price is one thing that Albertsons seems to be very arrogant and clueless about and continues with its highest in market pricing strategy all over the place. Loss leader ads only get you so far. You need fair pricing on other items to impulse sell at least an extra item or two to the cherry pickers.


A big issue seems to be that ACME has been unable to cater to local demographics, and each store is pretty much merchandised the same. Given many of these A&P and Pathmark stores were in more urban areas, and even as mediocre as they were, they were stocked with a large selection of stuff that would fit the community. They recently closed a former Pathmark in Newark that has a pretty big Latino? population, but the store only carried a basic selection of such items.

Pricing is another issues. While they have some occasional decent sales/loss leaders, lower every day prices still aren't there despite tons of marketing campaigns and other stuff to try and say otherwise. And A&P and Pathmark were pretty pricey towards the end as they lost their buying power, but somehow Acme, a company with national buying strength manages to be even higher.

Another thing that seems to be brought up is the lack of self-checkouts, that were ditched when Acme took over. They replaced them with manned express lanes, but the problem is, they typically don't have enough staff to cover them. And in a lot of these more urban stores, customers are more likely to pick up a few items every few days vs. doing a whole grocery trip...very dumb move all around.

And unfortunately, Acme inherited some 'bad eggs' when it comes to employees since they were pretty much forced to take on all the Union employees from A&P and Pathmark.

Given that Acme has only done a full remodel at only a handful of locations (some still just have Acme stickers covering the A&P/Pathmark logos on in-store signage) I'm sure some more closures will happen in the near future.

storewanderer
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Re: Executive change at Acme reflects integration issues

Postby storewanderer » June 22nd, 2017, 10:42 pm

It isn't only Acme that is *unwilling* to cater to local demographics. That is a major Safeway problem (wasn't something Albertsons was ever exactly great at either, but Safeway is known to be so bad at catering to local demographics...) and it seems like rather than making it better, the bad Safeway ideas/inflexibility seem to be infecting the rest of Albertsons. Safeway is the absolute worst operator I've ever seen at catering to the hispanic demographic. It is almost as if they are trying to drive them away with how they price and merchandise. They do a bit better with the Asian demographic though.

I too have heard the customers are perceiving higher prices at Acme than A&P had. I find it hard to believe. A&P/Pathmark when I went to their stores 4-5 years ago were TERRIBLE operators. The stores were literal garbage, prices were through the roof (much higher than Acme back then), perimeters were understocked and completely unappealing. Oddly, the Pathmarks seemed pretty busy, and priced a little lower than the A&Ps which were completely lost causes. A&P/Pathmark had self checkout but the technology was so old they didn't work real well. Acme could have easily reopened these stores with lower prices, highlight better bakery/deli items, and some technology upgrades and they would have done fine. I wonder if the employees are too stuck in the broken A&P mentality to care about doing a good job...

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Re: Executive change at Acme reflects integration issues

Postby pseudo3d » June 23rd, 2017, 2:26 pm

I think there are several problems. Perkins is the right guy for the job, but the immediate two problems I can see that aren't related to corporate culture:
- ACME simply overexpanded. Taking on the A&P stores brought ACME to a high water mark of the early 1990s but taking on a huge amount of stores in a short time has never proven successful for any company, especially since they were largely out of ACME's South Jersey base.
- A lot of the employees at the A&P just aren't very good, and the continuation of union benefits make bad employees harder to fire.

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Re: Executive change at Acme reflects integration issues

Postby storewanderer » June 24th, 2017, 12:10 am

The reviews over on Yelp of these stores are brutal. The stores look clean and well stocked...

This should be a lesson, this is what happens when you buy poorly performing assets and bring, in the eyes of the customers, nothing new or good to the table.

The constant complaints about high prices and removal of self checkouts. Will this company ever get it and fix their problems? The photos of some of these stores with lines stretching into the aisles, again, will they ever get it? They have pricing data of competitors and can adjust their pricing. They have customer count data and can adjust front end staffing to prevent the lines, or get the self checkouts back so you can serve more people at once.


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