Raleys lays off 47 corporate employees

[HCal]

A Save Mart merger would make sense, being that both chains have a joint venture for private label, Super Store Industries. What banner would you use assuming both were to merge? Raley’s has a better reputation.

Why do you need to pick one? They are both relatively unknown outside their service areas, which have little overlap. Perhaps Save Mart stores in the Sacramento area could be rebranded, but that's about it. I wouldn't introduce the Raley's name to the bay area Lucky stores or to the central valley.

I would hate to see Raley's get snapped up by some larger supermarket operator, or heaven forbid, a private equity group. If they don't stay independent, I think a merger with Stater might be the best option. No antitrust issues whatsoever, and both already use Topco. I would have favored a merger with Save Mart, but not sure I trust Kingswood in the long term.

[storewanderer]

A Save Mart merger would make sense, being that both chains have a joint venture for private label, Super Store Industries. What banner would you use assuming both were to merge? Raley’s has a better reputation.

Why do you need to pick one? They are both relatively unknown outside their service areas, which have little overlap. Perhaps Save Mart stores in the Sacramento area could be rebranded, but that's about it. I wouldn't introduce the Raley's name to the bay area Lucky stores or to the central valley.

I would hate to see Raley's get snapped up by some larger supermarket operator, or heaven forbid, a private equity group. If they don't stay independent, I think a merger with Stater might be the best option. No antitrust issues whatsoever, and both already use Topco. I would have favored a merger with Save Mart, but not sure I trust Kingswood in the long term.

I'd remove the Save Mart banner from Reno and Sacramento and keep Raleys banner in those markets. Probably flip some additional Save Mart locations to the Food Maxx banner instead of Raleys banner.

Probably wouldn't touch banners in the bay area- it is a mess with Raleys, Nob Hill, Lucky banners all present but they are still so few stores that I wouldn't mess with the banners.

I'd keep both banners Raleys and Save Mart in the central valley however- Raleys is positioned properly in those markets.

There would be some major overlap issues with such a merger, actually quite a few overlap issues. It could be as much as 50 stores of overlap. Given all the mergers I'm not sure who there is to sell to.

If I had to get rid of banners I'd get rid entirely of the banners "Save Mart" and "Nob Hill." Some would need to convert to Lucky and some to Raleys and I'd base it on the neighborhoods- Raleys for upper middle class locations and Lucky for lesser locations. I think the Save Mart banner needs to go; even in core markets like Modesto/Fresno it has a marginal at best reputation. Nob Hill has had a lot of closures over the years and Raleys hasn't done much with that banner, just sort of runs...

I think the Bel Air banner has significant value in Sacramento that makes it worth keeping. However, they could get away with a rebrand. It used to be Raleys was the large food drug/combo but Bel Air was the smaller "conventional grocery" (but with pharmacy usually) format. Now the lines have blurred and actually the main Raleys have become more like a Bel Air. They could rebrand Bel Air to Raleys and nobody would care.

[veteran+]

I am not sure Bashas would be open if they hadn't bought it... but they really need to do some serious work on Bashas banner. Food City is probably okay as it is but it could be so much better.

I suspect Yucaipa Companies would’ve bought Bashas and done a ‘Fresh & Easy maneuver’ (aka liquidation, probably selling the rural AZ stores to Albertsons) had Raley’s not bought them. That, or Aldi would be kicking the tires at Bashas as we speak.

There have been rumors on and off over the past 25 years of Ahold acquiring Raley’s.

A Save Mart merger would make sense, being that both chains have a joint venture for private label, Super Store Industries. What banner would you use assuming both were to merge? Raley’s has a better reputation.

Ron Burkle did not do so well with F&E even though Tesco practically paid him to take over.

I believe in his legacy portfolio that would not be evaluated as a "big" win.

[ClownLoach]

I am not sure Bashas would be open if they hadn't bought it... but they really need to do some serious work on Bashas banner. Food City is probably okay as it is but it could be so much better.

I suspect Yucaipa Companies would’ve bought Bashas and done a ‘Fresh & Easy maneuver’ (aka liquidation, probably selling the rural AZ stores to Albertsons) had Raley’s not bought them. That, or Aldi would be kicking the tires at Bashas as we speak.

There have been rumors on and off over the past 25 years of Ahold acquiring Raley’s.

A Save Mart merger would make sense, being that both chains have a joint venture for private label, Super Store Industries. What banner would you use assuming both were to merge? Raley’s has a better reputation.

Ron Burkle did not do so well with F&E even though Tesco practically paid him to take over.

I believe in his legacy portfolio that would not be evaluated as a "big" win.

Ron Burkle spends his money now on Hollywood productions and sports teams. Look at Yellowstone and all of its related shows... He's the executive producer.

[veteran+]

I suspect Yucaipa Companies would’ve bought Bashas and done a ‘Fresh & Easy maneuver’ (aka liquidation, probably selling the rural AZ stores to Albertsons) had Raley’s not bought them. That, or Aldi would be kicking the tires at Bashas as we speak.

There have been rumors on and off over the past 25 years of Ahold acquiring Raley’s.

A Save Mart merger would make sense, being that both chains have a joint venture for private label, Super Store Industries. What banner would you use assuming both were to merge? Raley’s has a better reputation.

Ron Burkle did not do so well with F&E even though Tesco practically paid him to take over.

I believe in his legacy portfolio that would not be evaluated as a "big" win.

Ron Burkle spends his money now on Hollywood productions and sports teams. Look at Yellowstone and all of its related shows... He's the executive producer.

Yup!!

[pseudo3d]

I am not sure Bashas would be open if they hadn't bought it... but they really need to do some serious work on Bashas banner. Food City is probably okay as it is but it could be so much better.

I suspect Yucaipa Companies would’ve bought Bashas and done a ‘Fresh & Easy maneuver’ (aka liquidation, probably selling the rural AZ stores to Albertsons) had Raley’s not bought them. That, or Aldi would be kicking the tires at Bashas as we speak.

There have been rumors on and off over the past 25 years of Ahold acquiring Raley’s.

A Save Mart merger would make sense, being that both chains have a joint venture for private label, Super Store Industries. What banner would you use assuming both were to merge? Raley’s has a better reputation.

I don't think Yucaipa Cos. bought F&E to close them. Yucaipa probably had plans to sell them to a new owner, but they had a host of issues, many of which were inherent to the chain and format. Turns out that the U.S. market wasn't interested in 15k square foot supermarkets, many of which were in bad locations to begin with.

[storewanderer]

I am not sure Bashas would be open if they hadn't bought it... but they really need to do some serious work on Bashas banner. Food City is probably okay as it is but it could be so much better.

I suspect Yucaipa Companies would’ve bought Bashas and done a ‘Fresh & Easy maneuver’ (aka liquidation, probably selling the rural AZ stores to Albertsons) had Raley’s not bought them. That, or Aldi would be kicking the tires at Bashas as we speak.

There have been rumors on and off over the past 25 years of Ahold acquiring Raley’s.

A Save Mart merger would make sense, being that both chains have a joint venture for private label, Super Store Industries. What banner would you use assuming both were to merge? Raley’s has a better reputation.

I don't think Yucaipa Cos. bought F&E to close them. Yucaipa probably had plans to sell them to a new owner, but they had a host of issues, many of which were inherent to the chain and format. Turns out that the U.S. market wasn't interested in 15k square foot supermarkets, many of which were in bad locations to begin with.

If the US isn't interested in 15k square foot limited assortment supermarkets, that does not bode well for Aldi trying to keep expanding either.

I think Yucaipa made a calculated deal for F&E. They basically took it off Tesco's hands for a fee. They tried to do some things to make it viable but when none of that seemed to work they just shut it down. I suspect Yucaipa made a small profit on the transaction. Maybe Burkle actually liked F&E and wanted to try to save it, but knew better than to throw good money after bad for too long of a time period.

[pseudo3d]

I suspect Yucaipa Companies would’ve bought Bashas and done a ‘Fresh & Easy maneuver’ (aka liquidation, probably selling the rural AZ stores to Albertsons) had Raley’s not bought them. That, or Aldi would be kicking the tires at Bashas as we speak.

There have been rumors on and off over the past 25 years of Ahold acquiring Raley’s.

A Save Mart merger would make sense, being that both chains have a joint venture for private label, Super Store Industries. What banner would you use assuming both were to merge? Raley’s has a better reputation.

I don't think Yucaipa Cos. bought F&E to close them. Yucaipa probably had plans to sell them to a new owner, but they had a host of issues, many of which were inherent to the chain and format. Turns out that the U.S. market wasn't interested in 15k square foot supermarkets, many of which were in bad locations to begin with.

If the US isn't interested in 15k square foot limited assortment supermarkets, that does not bode well for Aldi trying to keep expanding either.

Aldi's market share is very low and their stores typically aren't busy. However, they can compensate for that with a merchandise mix that draws people in, along with extremely low overhead. Yes, I suppose Yucaipa could've rebooted them as some sort of "Aldi, but British!" but by that time it would be a different grocery store in all but name.

[veteran+]

You are both correct about Yucaipa.

But I still think that it was an atypical move for Burkle.

The market was also different for that size of store. I think today he would have fared better in selling the units piecemeal.

Also the strange bespoke design of their new build stores were a big issue.

[ClownLoach]

I am not sure Bashas would be open if they hadn't bought it... but they really need to do some serious work on Bashas banner. Food City is probably okay as it is but it could be so much better.

I suspect Yucaipa Companies would’ve bought Bashas and done a ‘Fresh & Easy maneuver’ (aka liquidation, probably selling the rural AZ stores to Albertsons) had Raley’s not bought them. That, or Aldi would be kicking the tires at Bashas as we speak.

There have been rumors on and off over the past 25 years of Ahold acquiring Raley’s.

A Save Mart merger would make sense, being that both chains have a joint venture for private label, Super Store Industries. What banner would you use assuming both were to merge? Raley’s has a better reputation.

I don't think Yucaipa Cos. bought F&E to close them. Yucaipa probably had plans to sell them to a new owner, but they had a host of issues, many of which were inherent to the chain and format. Turns out that the U.S. market wasn't interested in 15k square foot supermarkets, many of which were in bad locations to begin with.

I agree. I think that the concept wasn't bad in it's later years under Yucaipa, but it had limited appeal at best and was only suited for a very limited number of locations. I happened to like the large selection of "meals for two" which were generally very high quality and allowed us to save a lot of money over eating out. But for every "good" location they opened three "bad" locations that weren't viable. And the real issue was the fact that they had high fixed overhead in the costs of the giant warehouse that was probably running at 5% or less of capacity, bleeding away any profits the stores might have made. Supposedly there was some sort of difficulty or problems with the logistics in these custom built buildings too? I do seem to recall seeing smaller than usual delivery trucks for F&E, which means higher delivery costs versus full size semi trucks. Maybe the docks weren't built for typical trucks? I don't think they could handle the typical grocery store trailer swap as they didn't seem to have an additional door for other deliveries?

If he decided to sink an additional amount of money into another mass expansion into viable locations, along with rebranding the entire operation to get the stink of the F&E dud brand off it, it would have probably worked and hedged against Aldi and Amazon. But the problem is that would have cost way too much, and the fixed costs of the business that were rooted in Tesco hubris were way too much to overcome. It probably would have taken another decade or two for a return on the investment and that just wasn't worth it. If you or I owned it and had the money, we probably would have to make the same tough decision that it is better to close the doors rather than continuing to spend good money on bad.