Gelsons Sold to Japanese company PPIH

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Re: Gelsons Sold to Japanese company PPIH

Post by storewanderer »

klkla wrote: February 26th, 2021, 6:53 pm
storewanderer wrote: February 26th, 2021, 5:38 pm Does Gelson's have any new stores in development at this point or is that done?

It is going to be really interesting to see what happens to Gelson's under this ownership.
If they do they haven't made it public. I don't think TPG was wanting to give them more money after the Haggen deal. The majority of those stores have under performed and I would be surprised if the return on investment was satisfactory.
Gelson's basically runs the store in a manner rather similar to Haggen (well, how Haggen looked immediately after reopening the conversion stores) so I am not surprised at all with those results. Gelson's merchandising is certainly better than Haggen but the same sort of issues exist- you took plain vanilla conventionals with relatively strong center store promotion programs and you cut those off (no thanks at all to Unified and all the merchandising/promotional "help" they gave oh there was none) then you try to upscale the perimeters with a decline in foot traffic.

I thought Gelson's would make more of a splash with their new stores and do a better job capturing customers who were looking for higher quality fresh products. Maybe the demand just wasn't there in the former Haggen Stores for that kind of format.
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Re: Gelsons Sold to Japanese company PPIH

Post by klkla »

storewanderer wrote: February 26th, 2021, 7:03 pm
Gelson's basically runs the store in a manner rather similar to Haggen (well, how Haggen looked immediately after reopening the conversion stores) so I am not surprised at all with those results. Gelson's merchandising is certainly better than Haggen but the same sort of issues exist- you took plain vanilla conventionals with relatively strong center store promotion programs and you cut those off (no thanks at all to Unified and all the merchandising/promotional "help" they gave oh there was none) then you try to upscale the perimeters with a decline in foot traffic.

I thought Gelson's would make more of a splash with their new stores and do a better job capturing customers who were looking for higher quality fresh products. Maybe the demand just wasn't there in the former Haggen Stores for that kind of format.
In hindsight they may have been better off waiting until the stores were remodeled before opening them. But they wanted to get the employees at those stores working again as quickly as possible so at least their motivation was well intentioned.
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Re: Gelsons Sold to Japanese company PPIH

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klkla wrote: February 26th, 2021, 8:00 pm
In hindsight they may have been better off waiting until the stores were remodeled before opening them. But they wanted to get the employees at those stores working again as quickly as possible so at least their motivation was well intentioned.
It is too bad they couldn't come up with a quick remodel program. First impressions mean a lot and those stores upon initial conversion definitely did not live up to the atmosphere of the typical Gelson's. For instance the store in Carlsbad- I was there when it was a Haggen (immediately after conversion) and it looked pretty good in the fresh departments. Not much traffic, but not deserted. Center store was a total disaster. I was there again soon after Gelson's took it over (with the interior that had banners on the walls for the departments). The fresh departments looked about the same as Haggen, it had even fewer customers, and though center store looked better in terms of how it was merchandised and stocked the prices were too high for a large size store like that. Of course they later downsized/remodeled the store but I'm not sure how many people who live near the store went from having what was an above average Albertsons to the disaster Haggen to the Gelson's that seemed to be not much better than Haggen.

Almost wonder if Gelson's should have tried running them temporarily as low effort conventional stores under the Mayfair banner to keep the employees employed and keep some customers flowing through, while remodeling them flip the name to Gelson's.
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Re: Gelsons Sold to Japanese company PPIH

Post by rwsandiego »

I think there were two issues with Gelson's Haggen acquisition: 1) They were (and, largely, still are) unfamiliar to San Diegans and 2) they bought the wrong locations (except for Pacific Beach). They would have been better off buying the Mission Hills and Coronado stores and maybe North Park (that area is not unlike Silver Lake, where they have a store). All three are smaller stores and are located in upscale neighborhoods. I've never been to the Carlsbad location, but the one in Del Mar is simply too big.
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Re: Gelsons Sold to Japanese company PPIH

Post by klkla »

rwsandiego wrote: February 27th, 2021, 5:39 am I think there were two issues with Gelson's Haggen acquisition: 1) They were (and, largely, still are) unfamiliar to San Diegans and 2) they bought the wrong locations (except for Pacific Beach). They would have been better off buying the Mission Hills and Coronado stores and maybe North Park (that area is not unlike Silver Lake, where they have a store). All three are smaller stores and are located in upscale neighborhoods. I've never been to the Carlsbad location, but the one in Del Mar is simply too big.
I think the Pacific Beach and Del Mar locations were good choices. You have to keep in mind that the wealthiest neighborhood in San Diego (Rancho Santa Fe) is adjacent to Del Mar. I agree they should have downsized the store, though.

Mission Hills and Coronado don't have the population density of wealthy customers to support a Gelson's. In hindsight they should have kept the Mayfair at 5th & Robinson in nearby Hillcrest which would have been the perfect location for a Gelson's.

North Park has the population density overall but there's no wealth in that area at all. Silverlake is nothing like North Park. The the people living on the hill to the east of the store are very wealthy as are the residents in Franklin Hills and Los Feliz west/north of the store.
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Re: Gelsons Sold to Japanese company PPIH

Post by storewanderer »

rwsandiego wrote: February 27th, 2021, 5:39 am I think there were two issues with Gelson's Haggen acquisition: 1) They were (and, largely, still are) unfamiliar to San Diegans and 2) they bought the wrong locations (except for Pacific Beach). They would have been better off buying the Mission Hills and Coronado stores and maybe North Park (that area is not unlike Silver Lake, where they have a store). All three are smaller stores and are located in upscale neighborhoods. I've never been to the Carlsbad location, but the one in Del Mar is simply too big.
Carlsbad was basically a late model Albertsons Store; it was quite a bit larger than Del Mar. I'm not sure if Carlsbad was a major remodel/expansion of an older store but the layout and flow of the place was like the new stores they build today. Bakery/deli on the right, produce in front of it out in the open, meat on the back wall, frozen on the left wall, pharmacy in the left corner.
Last edited by storewanderer on February 28th, 2021, 11:56 am, edited 1 time in total.
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Re: Gelsons Sold to Japanese company PPIH

Post by veteran+ »

klkla wrote: February 27th, 2021, 10:12 am
rwsandiego wrote: February 27th, 2021, 5:39 am I think there were two issues with Gelson's Haggen acquisition: 1) They were (and, largely, still are) unfamiliar to San Diegans and 2) they bought the wrong locations (except for Pacific Beach). They would have been better off buying the Mission Hills and Coronado stores and maybe North Park (that area is not unlike Silver Lake, where they have a store). All three are smaller stores and are located in upscale neighborhoods. I've never been to the Carlsbad location, but the one in Del Mar is simply too big.
I think the Pacific Beach and Del Mar locations were good choices. You have to keep in mind that the wealthiest neighborhood in San Diego (Rancho Santa Fe) is adjacent to Del Mar. I agree they should have downsized the store, though.

Mission Hills and Coronado don't have the population density of wealthy customers to support a Gelson's. In hindsight they should have kept the Mayfair at 5th & Robinson in nearby Hillcrest which would have been the perfect location for a Gelson's.

North Park has the population density overall but there's no wealth in that area at all. Silverlake is nothing like North Park. The the people living on the hill to the east of the store are very wealthy as are the residents in Franklin Hills and Los Feliz west/north of the store.
I wonder how the Rancho Mirage store is doing (quite huge for them).

It was a Pavilions before (that I managed). Pretty high volume during season for the desert.
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Re: Gelsons Sold to Japanese company PPIH

Post by klkla »

veteran+ wrote: February 27th, 2021, 12:09 pmI wonder how the Rancho Mirage store is doing (quite huge for them).

It was a Pavilions before (that I managed). Pretty high volume during season for the desert.
They downsized that one when they remodeled it. I've heard that it was doing well during the season still, at least pre-covid it was.
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Re: Gelsons Sold to Japanese company PPIH

Post by retailfanmitchell019 »

storewanderer wrote: February 27th, 2021, 10:20 am Carlsbad was basically a late model Albertsons Store; it was quite a bit larger than Del Mar. I'm not sure if Carlsbad was a major remodel/expansion of an older store but the layout and flow of the place was like the new stores they build today. Bakery/deli on the right, produce in front of it out in the open, meat on the back wall, frozen on the right wall, pharmacy in the right corner.
The Carlsbad (La Costa) store was planned by Lucky, but built by Albertsons. Construction was delayed for a few years due to environmental problems with the land site. It was going to open in October 2003, but opened in March 2004, delayed by the strike. Store originally had a high-end Jewel interior, but got dumbed down with SVU 2012 decor (PF&H III) before the sale to Haggens.
The Del Mar Albertsons, meanwhile, was formerly a Big Bear market (sold to Albertsons in 1994). It originally had Blue/Gray, then Jewel decor (high-end), then SVU 2012. This was the one of the most profitable Albertsons in the county.
Pacific Beach is a former 60's Alpha Beta/Lucky.

If Gelson's chooses to exit San Diego, Albertsons could buy back all 3 stores, or maybe Stater could buy the Pacific Beach and Del Mar stores (the Carlsbad store is too close to their Encinitas store: a former Albertsons)
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Re: Gelsons Sold to Japanese company PPIH

Post by Bagels »

storewanderer wrote: February 25th, 2021, 11:43 pmWhat is this horrible reputation exactly? I know the stores are not the greatest physical condition but my observation has been of well run well staffed and busy stores with very efficient employees. There is a real difference in the behavior and sense of urgency with the employees at Stater vs. the other major chains. I wasn't real thrilled with their pricing as of late (seemed like Ralphs was similarly priced on center store items) especially on produce and on my "would I shop here if I lived here" assessment when it came to Stater in most categories outside meat and maybe some limited other items that would be a no.
@kikla summed it up really well. SB introduced their "Blue Ribbon" format which features an upscale interior, higher quality perishables and more prepared foods (including an island where they cut and package produce). I question how many of there stores could support this format, given that prices are noticeably higher. For example, when I stopped in the new Tustin location recently, "due to a global shortage" bananas were selling for 75c/lb., which is higher than Ralphs and Albertsons/Vons and by itself will turn away a number of casual shoppers. Even the generic Topco sheet cake slices (branded "Cleo and Leo") were selling now selling for $4.49 a slice , up from a $1.99 just two or three years ago.

Ultimately, until SB finds itself and turns its reputation around, I doubt it'd be able to successfully pick off any Gilson's location.
How does Stater's store count decline compare with the store count decline of Ralphs, Vons, and Albertsons in these areas? I suspect Stater's decline as a percent of total store count is much smaller than the other 3 chains.
Bad comparison. By 2000, Ralphs, Vons and Albertsons were bloated chains (a result of multiple mergers) with comprehensive coverage in LA/OC. It was inevitable that the chains were going to shrink. In contrast, SB had minimal presence and plenty of opportunity for growth. Yet the chain has remained stagnant, even as plenty of opportunities have arose -- e.g. the decline of Haggen lead to dozens of stores, many of which had received some degree of renovation, on the market at cheap rates -- but they've yet to make a move.
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