Albertsons/Safeway and a lack of "entry level" products

[pseudo3d]

One of the things I've noticed with Albertsons and Safeway these days is a lack of an "entry level" generic brand. Most of their competitors stock a more premium store brand and a "lesser" store brand that they won't even put the store's name on...the Kroger P$$T and Check This Out brands, Shoppers Value for SuperValu stores, and many others I'm forgetting. I know Safeway had Basic Red for a while and that became Pantry Essentials, but it's not being marketed all that well and frankly doesn't convey "value" all that much (you could also argue the price is too high, but please--one problem at a time). I even read somewhere that some PE items are disappearing. Is Albertsons marketing a 3rd party "low end" brand (I think that's what H-E-B does for some products...like chocolate chips that are actually chocolate-flavored sugar) or they pushing that out for solely their Signature brand?

[architect]

One of the things I've noticed with Albertsons and Safeway these days is a lack of an "entry level" generic brand. Most of their competitors stock a more premium store brand and a "lesser" store brand that they won't even put the store's name on...the Kroger P$$T and Check This Out brands, Shoppers Value for SuperValu stores, and many others I'm forgetting. I know Safeway had Basic Red for a while and that became Pantry Essentials, but it's not being marketed all that well and frankly doesn't convey "value" all that much (you could also argue the price is too high, but please--one problem at a time). I even read somewhere that some PE items are disappearing. Is Albertsons marketing a 3rd party "low end" brand (I think that's what H-E-B does for some products...like chocolate chips that are actually chocolate-flavored sugar) or they pushing that out for solely their Signature brand?

At least in DFW, Pantry Essentials is gradually being replaced by the new Value Corner brand. So far, I have just seen it on milk at a couple of Tom Thumb locations, one of which is pictured below. The color coding is a bit deceiving, as the background color for each type of milk matches the equivalent Lucerne color, and the only real way to tell the two apart is the branding itself.

[storewanderer]

Value Corner is at Vons too.

Albertsons/Safeway is in a somewhat precarious position. Adding in or pushing an entry level value brand may cause their customers to "trade down" to that brand and therefore hurt their sales. They cannot have that. They have to keep posting strong sales numbers to build up for that IPO.

At the same time in order to be successful long term they have got to do something about pricing and adding in an entry level value generic brand is one way to help address that.

Safeway's Pantry Essentials brand was garbage level quality. I bought terrible bread that was outright inedible, chalky bad tasting milk, almost picked up some shredded cheese that I then saw was actually shredded imitation cheese and at that point never touched that brand again. Similar to bad experiences I had in the early 2000's with the Kroger FMV Brand and stopped buying anything in that brand. I have bought a few items in the Kroger Owl PSST brand (hot dog buns, tea bags, graham crackers) and the items suited their purpose well enough. I have seen the Owl PSST brand on some other items at Kroger that I would not buy (paper products) because the quality is clearly just bad.

[pseudo3d]

Value Corner is at Vons too.

Albertsons/Safeway is in a somewhat precarious position. Adding in or pushing an entry level value brand may cause their customers to "trade down" to that brand and therefore hurt their sales. They cannot have that. They have to keep posting strong sales numbers to build up for that IPO.

At the same time in order to be successful long term they have got to do something about pricing and adding in an entry level value generic brand is one way to help address that.

Safeway's Pantry Essentials brand was garbage level quality. I bought terrible bread that was outright inedible, chalky bad tasting milk, almost picked up some shredded cheese that I then saw was actually shredded imitation cheese and at that point never touched that brand again. Similar to bad experiences I had in the early 2000's with the Kroger FMV Brand and stopped buying anything in that brand. I have bought a few items in the Kroger Owl PSST brand (hot dog buns, tea bags, graham crackers) and the items suited their purpose well enough. I have seen the Owl PSST brand on some other items at Kroger that I would not buy (paper products) because the quality is clearly just bad.

They don't have to "trade down" always. Albertsons/Safeway has built up a large store base with both affluent and not-affluent areas. If they push them in the lower-end stores, it wouldn't harm the upper-end stores.

Shame about the milk...usually at Kroger and H-E-B, the lower-end store milk still tastes decent (that or I've just gotten used to bad milk). The "upper-end" store brand has the Kroger or H-E-B brand, while the lower end brand is Springdale or Hill Country Fare brand, respectively. I understand Kroger's "lower-end" milk changes based on division, and I kind of wish Albertsons did that (like putting Dairy Glen back in Vons, which looks like they were still selling as of 2010).

[storewanderer]

I routinely buy the "low end" milk brands here at Smiths (Mountain Dairy) and at Raleys/Food Source (Bayview) and find the quality to be just fine.

Dairy Glen was sold at Safeway throughout the 1990's as a budget milk brand. Glen stands for Glencourt which was the name of the manufacturing arm (now Better Living Brands LLC). It was discontinued when the lifestyle store program started (good way to bump sales up: take away the lower priced milk forcing customers to buy higher priced Lucerne). It was brought back around 2009 or 2010 before shortly being rebranded Pantry Essentials.

Safeway/Albertsons already struggles in lower end areas and generally the stores they have in those types of areas are low volume and are on the edge of being closed. These are stores that price sensitive customers are long gone from and those who shop there are doing so for convenience and at this point price is not relevant. Look at what has happened in Denver and surrounding in the past couple years as those stores fit that profile perfectly. The stores function like convenience stores with people running small transactions. Adding in a lower end private label in a few categories will not fix their problems (the pricing is still too high throughout the store and more lower end low cost private labels won't be enough to change customer perception). Part of operating a conventional with convenience store like transactions is controlling your product mix, controlling shrink, and optimizing pricing so you can wrestle enough profit off of small transactions to at least cover your expenses. Adding in a low end private label creates another item, additional potential shrink in the category as customers potentially trade down to the lower price item because you have too much mix on the shelf and stuff goes out of code before you can sell through...

I do not think a lower end private label is the answer for Albertsons/Safeway. Actually, great quality private label items under the Signature brand at great prices every day is the answer. The problem is the Signature brand items are priced outrageously, often costing substantially more than national brand items on promotion. This was the same problem Safeway private label started having in the 2000's. Garbage quality private label items cause me to lack faith in the entire private label program. Safeway, historically, had a far better quality private label program than its competitors. Throughout the 1990's and 2000's I felt I could pick up any Safeway brand item and be pleased with the quality. I no longer feel that way in light of a couple recent experiences with poor quality private label Lucerne items which I actually went and got refunds on, the noticeably lower quality on the private label preserves since they stopped producing them at a Safeway owned factory, etc. I had some questionable experiences with the Kroger FMV items a long time ago and also those "Everyday Living" cleaning products more recently, these types of experiences caused me to be skeptical about the entire Kroger private label program's quality. I buy a lot of items in Kroger brand. So now, with Kroger, I usually study the packages/ingredients before purchasing. I have always been happy with the quality and price of the Kroger brand items I've purchased in recent years but there are cases once or twice a month where I pick up the Kroger item from the shelf and for one reason or another decide I am not confident in the quality of the product and do not buy it.

The "Signature" brand needs to be the entry level private label. Great quality at a great price. And they actually need to live up to those statements. This combined Albertsons/Safeway is really good at making false promises and they really need to stop that. 3's a Crowd? Lie. Total lie. Famous Bake House Bread "so fresh it's like we baked it on the shelf" with a 5 day shelf life between bake date and sell by date and by day 2 that bread is dry. Lie again. They really stretch it with a lot of the items they flag as "Local" too. Maybe they should just be more transparent and rather than market items as "Local" with a generic sign just put up a sign that says exactly where the item is from. My dissatisfaction with Albertsons/Safeway is growing rapidly, especially with this NorCal Division and the execution problems I am seeing.

[pseudo3d]

I routinely buy the "low end" milk brands here at Smiths (Mountain Dairy) and at Raleys/Food Source (Bayview) and find the quality to be just fine.

Dairy Glen was sold at Safeway throughout the 1990's as a budget milk brand. Glen stands for Glencourt which was the name of the manufacturing arm (now Better Living Brands LLC). It was discontinued when the lifestyle store program started (good way to bump sales up: take away the lower priced milk forcing customers to buy higher priced Lucerne). It was brought back around 2009 or 2010 before shortly being rebranded Pantry Essentials.

Maybe the PE milk you bought was just a bad batch...I know I had some H-E-B milk (not the lower end store brand, as it doesn't come in half-gallon sizes) that tasted already a bit sour right out of the bottle, returned it, and it's been fine.

Safeway/Albertsons already struggles in lower end areas and generally the stores they have in those types of areas are low volume and are on the edge of being closed. These are stores that price sensitive customers are long gone from and those who shop there are doing so for convenience and at this point price is not relevant.

Any chain will tend to struggle on low-end areas, not just because of a higher tendency of shoplifting but also a lot of foods go unsold and have to be liquidated or thrown out. This results in stores losing profit just because they're throwing out a lot of food or being forced to downscale their selection, which can lead to a bad impression of the chain (Kroger generally tends to weed out these stores sooner or later but H-E-B often does not).

Look at what has happened in Denver and surrounding in the past couple years as those stores fit that profile perfectly. The stores function like convenience stores with people running small transactions. Adding in a lower end private label in a few categories will not fix their problems (the pricing is still too high throughout the store and more lower end low cost private labels won't be enough to change customer perception).

Denver's situation combines a poor operation faced with a strong competitor (in this case, King Soopers). Not even the Albertsons Fried Chicken program is safe because King Soopers has the Chester Fried Chicken program.

Part of operating a conventional with convenience store like transactions is controlling your product mix, controlling shrink, and optimizing pricing so you can wrestle enough profit off of small transactions to at least cover your expenses. Adding in a low end private label creates another item, additional potential shrink in the category as customers potentially trade down to the lower price item because you have too much mix on the shelf and stuff goes out of code before you can sell through...

Arguably, I think the "convenience store" problem is related to the fact that Safeway stores do tend to be smaller than their competitors. Albertsons stores are bigger on average, with King Soopers even more so. Notice that the "convenience store" problem only tends to affect stores that already have comparatively small square footage anyway (like, say, Food Lion).

I do not think a lower end private label is the answer for Albertsons/Safeway. Actually, great quality private label items under the Signature brand at great prices every day is the answer. The problem is the Signature brand items are priced outrageously, often costing substantially more than national brand items on promotion. This was the same problem Safeway private label started having in the 2000's. Garbage quality private label items cause me to lack faith in the entire private label program. Safeway, historically, had a far better quality private label program than its competitors. Throughout the 1990's and 2000's I felt I could pick up any Safeway brand item and be pleased with the quality. I no longer feel that way in light of a couple recent experiences with poor quality private label Lucerne items which I actually went and got refunds on, the noticeably lower quality on the private label preserves since they stopped producing them at a Safeway owned factory, etc. I had some questionable experiences with the Kroger FMV items a long time ago and also those "Everyday Living" cleaning products more recently, these types of experiences caused me to be skeptical about the entire Kroger private label program's quality. I buy a lot of items in Kroger brand. So now, with Kroger, I usually study the packages/ingredients before purchasing. I have always been happy with the quality and price of the Kroger brand items I've purchased in recent years but there are cases once or twice a month where I pick up the Kroger item from the shelf and for one reason or another decide I am not confident in the quality of the product and do not buy it.

For what it's worth, the FMV products were rebranded with the owl packaging a few years back. But even with the Kroger "regular" brand I've had some bad experiences (the Kroger toaster pastries one of my most notorious memories in the last past 7 years).

The "Signature" brand needs to be the entry level private label. Great quality at a great price. And they actually need to live up to those statements. This combined Albertsons/Safeway is really good at making false promises and they really need to stop that. 3's a Crowd? Lie. Total lie. Famous Bake House Bread "so fresh it's like we baked it on the shelf" with a 5 day shelf life between bake date and sell by date and by day 2 that bread is dry. Lie again.

I've never seen the "3's a Crowd" signs at the Houston division (Randalls) stores. Just as well, because the stores were usually plagued with lines...

They really stretch it with a lot of the items they flag as "Local" too. Maybe they should just be more transparent and rather than market items as "Local" with a generic sign just put up a sign that says exactly where the item is from. My dissatisfaction with Albertsons/Safeway is growing rapidly, especially with this NorCal Division and the execution problems I am seeing.

To be fair, Kroger's "local" push (I think it was with "Made in Texas") left a bit to be desired too, such as the sign on their generic brand bleach.

[architect]

I do not think a lower end private label is the answer for Albertsons/Safeway. Actually, great quality private label items under the Signature brand at great prices every day is the answer. The problem is the Signature brand items are priced outrageously, often costing substantially more than national brand items on promotion. This was the same problem Safeway private label started having in the 2000's. Garbage quality private label items cause me to lack faith in the entire private label program. Safeway, historically, had a far better quality private label program than its competitors. Throughout the 1990's and 2000's I felt I could pick up any Safeway brand item and be pleased with the quality. I no longer feel that way in light of a couple recent experiences with poor quality private label Lucerne items which I actually went and got refunds on, the noticeably lower quality on the private label preserves since they stopped producing them at a Safeway owned factory, etc. I had some questionable experiences with the Kroger FMV items a long time ago and also those "Everyday Living" cleaning products more recently, these types of experiences caused me to be skeptical about the entire Kroger private label program's quality. I buy a lot of items in Kroger brand. So now, with Kroger, I usually study the packages/ingredients before purchasing. I have always been happy with the quality and price of the Kroger brand items I've purchased in recent years but there are cases once or twice a month where I pick up the Kroger item from the shelf and for one reason or another decide I am not confident in the quality of the product and do not buy it.

For what it's worth, the FMV products were rebranded with the owl packaging a few years back. But even with the Kroger "regular" brand I've had some bad experiences (the Kroger toaster pastries one of my most notorious memories in the last past 7 years).

It's funny that you mention those toaster pastries, because I actually just bought those for the first time a couple of months back, and thought that they were better than actual Pop-Tarts. I'm sure that Kroger improved them somewhere along the way though (especially if they were receiving a substantial amount of complaints/returns). My worst Kroger brand memory was a box of white cheddar macaroni and cheese I bought a few years back, it tasted terribly chemically. On the other hand, the Simple Truth mac and cheese is incredibly good, and I would highly suggest trying it!

[Super S]

On a related note, I have noticed that the "Mountain Dairy" private label has quietly disappeared from my local Fred Meyer, and they pretty much sell gallons only under the Fred Meyer brand now. The price is competitive with WinCo. And quite honestly there isn't any noticeable difference in the milk.

And I will also say that, at least with Fred Meyer/Kroger , some of their private label products are just as good if not better. One thing I like is their frozen waffles which, to me, taste better than Eggo. And they do back their products and honor their satisfaction guarantee when there is a problem, which is not often.

Back to Albertsons/Safeway. They need to figure out their direction, but should maybe stick to offering a limited number of store labels which can be shared between the two and expand the lineup a bit, and price the products competitively. Both chains have proven in the past that they can operate successful private label programs. I don't think "entry level" is really the best way to approach it though. That could be accomplished by offering products in white containers with black letters. Albertsons and Safeway are not entry level grocers.

[storewanderer]

I am going to assume the bleach flagged as "local" in Texas was made: https://www.olinchloralkali.com/en-us/L ... reeport-TX just an hour from Houston so that seems relevant to flag as "local" in Houston (maybe not so much in Dallas).

That's actually pretty good they even flagged a non food item as "local" - usually only see that on food.

The convenience store factor actually was always something I observed with Albertsons over the years even 20 years ago. Albertsons always specialized in small transactions, high prices, and not many full cart shops. Their promotional program on center store was never good. In some (many) cases they never consistently had items on sale in a given category. And their regular prices were always very high. Safeway always ran a lot of sales, coupon books, etc. and in every given category (e.g.: peanut butter, canned fruit, eggs, etc.) at a given time if you went into a Safeway you would find some brand and size in every category at a good sale price. As in, you could do just as good doing a full cart shop at Safeway back then as you could at WinCo, if you were flexible on brand. I cannot say the same for Albertsons, their pricing was outrageous. This all changed when the lifestyle program started at which point Safeway's pricing also became very outrageous. Back to Albertsons, back in the 90's and 00's, Internally stores and departments were extremely focused on their gross profit percentage and did not care much about sales as long as they kept their gross percentage up.

I think financial figures would prove that out also. Safeway's volume per store and also sales per square feet were generally quite higher than Albertsons (Jewel excluded) even when you factored in Safeway's poorly performing areas in... back in the 2000's when both were publicly traded.

I kind of felt like Kroger eliminated some of the poor FMV items when they rebranded to Kroger Value and actually eliminated even more of the items when they rebranded to Owl PSST. For instance I think that product line is gone entirely from dairy (no more imitation cheese or giant tubs of chemical margarine like substance at Smiths, anyway). The brand feels sort of redundant there since Kroger brand items are already priced pretty low to begin with.

[pseudo3d]

Albertsons and Safeway are not entry level grocers.

They're definitely not entry-level on the level of, say, Aldi, but I think that's the impression caused by the traditionally higher prices of the chains. But Safeway was once a modest chain found in even smaller towns of Texas, and Jewel pioneered one of the first "true" generic lines. If they got their everyday prices under control, then it would be a different story.

I am going to assume the bleach flagged as "local" in Texas was made: https://www.olinchloralkali.com/en-us/L ... reeport-TX just an hour from Houston so that seems relevant to flag as "local" in Houston (maybe not so much in Dallas).

That's actually pretty good they even flagged a non food item as "local" - usually only see that on food.

Well, I'm not sure if that's actually the plant that bottles Kroger brand bleach but it's still packaged under their name...and Kroger did not label (as far as I know) Mars candies as "Made in Texas" even though they're from a plant in Waco, which is frankly the better move.

[...] The brand feels sort of redundant there since Kroger brand items are already priced pretty low to begin with.

I believe Kroger's store brand program is something described like "good, better, best", explaining their multiple brands. I suppose this has higher profit margins but it often bumps out national brands (this is one of the things I really don't like about H-E-B).