Bashas- Announcement?

[storewanderer]

Supposedly Bashas has a "major announcement" coming in a few hours. Meanwhile, some news circuit is reporting that they are closing "10 more stores" 7/21 and lists some addresses. All of these closures were previously announced; this is not news at all. Maybe the real news will come in a few hours, whatever it may be. Wouldn't it be funny if it was good news?

[krogerclerk]

Turns out they are entering Chapter 11 bankruptcy. AZ/NM chains haven't had a good track record for surviving bankruptcies, ABCO and Furr's both collapsed under Fleming, and Bayless, itself the origin of AJ's Market, and MegaFoods have all disappeared.

The sheer number of Basha's locations and its market ranking will give them better odds of surviving, but I suspect that WalMart has taken their traditional customer base while Fry's(KR) and Safeway have effectively moved upmarket in Arizona as well as continuing to open new stores. This should be good for Albertson's LLC in this market, which announced it's seeking acquisition opportunities. Most Basha's stores are smaller than Albertson's preferred sized however.

[storewanderer]

Okay, so it wasn't such good news. I'm not surprised to be honest. Their stores suffer from years of noninvestment and per store volumes seem low.

They used to have their own Bashas' private label, but in the past couple years they have moved entirely to Food Club.

[romleys]

http://www.reuters.com/article/innovati ... WU20090713

[jamcool]

Bashas' has been opening a number of nice new stores in AZ in the past few years, unfortunately instead of closing the underperformers, they have merely converted them to the Food City format. Plus the problems with the UFCW that came over from the AJ's acquisition (AJ's was the remnants of the old AJ Bayless/Q-Fresh/Arizona Supermarkets operation and was union)-AJ's is union, the rest of Bashas' is non-union. Expect a bunch of Food Citys to close, and the Bashas' stores in the far corners of AZ also. (Page is closing, and Kingman, Needles(CA) and Yuma probably will too)

Who buys the castoff stores? Pro's Ranch Market (who competes with Food City for the same clientele), La Super, maybe Sprouts, some may become IGAs (Bashas' supplies a hand full of Ariz IGA stores through a subsidiary). Definitely not ABS, they have been closing stores here and have a miniscule share (7-8%) of the Phx market - ABS may disappear here before Bashas' does.

[storewanderer]

The Bashas' in Needles is the only store for miles (alongside a neighboring out of place Rite Aid). I don't see them closing it, but I suppose they could sell it (but to who?). I don't think the demographics of Needles would interest Safeway/Vons. And since it is over the CA line, that likely rules out any logical match Kroger operation (Frys/Smiths could work there, Ralphs would not). Maybe Stater would take it. It needs to be remodeled.

I assume they have a group of profitable stores. The bankruptcy will allow a lot of closures and allow them to get out of a lot of leases so they can focus on the profitable stores. The issue is what their share will be after they do all that.

Union problems have little to nothing to do with this filing, regardless of how anyone is trying to spin that. Bashas' did this to themselves.

[jamcool]

Bashas' will be reopening one of its closed stores. The 1-yr old Goodyear store, which closed on Oct 10, will reopen this Saturday. Bashas' wanted a cut on its lease rates, which it got from the owner of the power center (Westcor), whom did not need another empty big box.

[krogerclerk]

Arizona is recovering from the housing meltdown, so this could offer some relief to Basha's. Also, it could be down to a case of who flinches first in Arizona, Albertsons LLC or Basha's. Fry's/Kroger and Safeway are better positioned against a growing Walmart presence than Basha's and Albertsons. It's becomimg increasingly difficult for 3-4 traditional supermarket chains to operate profitably once Walmart Supercenters become a major presence. Two dominant traditionals tend to prevail while an occasional 3rd can make headway if there is enough affluence and/or growth to exploit.

[krogerclerk]

There seems to be rumors that ABS LLC is interested in Basha's, but so far they are only rumors. Most Basha's are different from the traditional Albertson's Food-Drug format, which are typical larger than most Basha's and depend on much higher volume to be profitable.

[klkla]

There seems to be rumors that ABS LLC is interested in Basha's, but so far they are only rumors. Most Basha's are different from the traditional Albertson's Food-Drug format, which are typical larger than most Basha's and depend on much higher volume to be profitable.

Actually it's more than a rumor. They made a formal offer to the bankruptcy court and Bashas but Bashas turned them down saying the offered price was too low.

You can read more here:
http://www.azcentral.com/business/artic ... s0226.html