Albertsons: Results improving, growth initiatives

[storewanderer]

https://www.supermarketnews.com/retail- ... nes-growth

Looks like things are progressing a bit here under this new CEO. Safeway in my market continues to be poorly run with sub par quality of products due to poorly operated stores and a lack of focus on product freshness, but at least it has a wide scale price cut program in place. Price can make customers look past many problems, how else did Wal Mart become the largest grocer?

Kroger's MANY missteps lately, combined with lack of opening new stores out west where Albertsons already has a much higher store count, probably helps Albertsons to some degree.

I think Albertsons has many opportunities to build share in the west (largely at the expense of Kroger).

Will be interesting to see how profitability is the next few years and how things go when they get the IPO going. If they can somehow reproduce what they are doing in Boise with those two new concept stores in other markets, I think they can get a lot of positive attention.

[Super S]

Will be interesting to see how profitability is the next few years and how things go when they get the IPO going. If they can somehow reproduce what they are doing in Boise with those two new concept stores in other markets, I think they can get a lot of positive attention.

I have to wonder what direction Portland and Seattle will go. Safeway seems to be the stronger of the two names in both markets. With that said, Safeway seems to have cheapened the look of their stores. I think they need to consider building a handful of new stores, along with investing in some remodels, if for no other reason than to have something to justify their higher price point. The early Lifestyle stores seemed to be a similar idea, but as time went on the stores have been cheapened by random lighting retrofits among other things. We haven't seen those new Albertsons store designs outside of Boise yet, and as far as I know, this has not carried over to Safeway.

[storewanderer]

Will be interesting to see how profitability is the next few years and how things go when they get the IPO going. If they can somehow reproduce what they are doing in Boise with those two new concept stores in other markets, I think they can get a lot of positive attention.

I have to wonder what direction Portland and Seattle will go. Safeway seems to be the stronger of the two names in both markets. With that said, Safeway seems to have cheapened the look of their stores. I think they need to consider building a handful of new stores, along with investing in some remodels, if for no other reason than to have something to justify their higher price point. The early Lifestyle stores seemed to be a similar idea, but as time went on the stores have been cheapened by random lighting retrofits among other things. We haven't seen those new Albertsons store designs outside of Boise yet, and as far as I know, this has not carried over to Safeway.

They seem to be trying to work on price. In my market, and a few other more competitive and less affluent operating areas of NorCal (Fresno and Redding) they are right there with the lower price operators (Smiths, Winco, etc.) now on many branded center store and produce items. We will see how long it lasts. Some items have already gone up from the first week's "new every day low price" and this is only week 4 of the program here in Reno... Customer traffic looks no different than before and there is zero enthusiasm among the employees about the changes, which are very positive and have great potential to grow traffic.

The Safeway banner and associated format is anemic and generally dismal. They need to try harder on everything (service, price, quality, freshness). They aren't exactly bad, but they are not performing up to their abilities. The marketing platform continues to be screwed up, the loyalty card program is poor, and pricing is too complicated. The lifestyle stores are very tired and not merchandised particularly well (way too much space for bottled water, soda, and chips). The lighting "enhancements" Albertsons has done do not look good.

Some of the remodels they have done (Colorful Lifestyle) are very nice. But they seem to be doing them cheaply and really need to ditch all remnants of Lifestyle like the floors, checkstand lights, etc. Even the Florida (Modern, as they call it) decor can look nice, but I have mixed opinions on that depending on the store location.

Albertsons best bet at this point is to strategically place some of those Boise Market Street concept stores in a variety of markets and get the execution right. It would greatly engage customers and employees alike. As far as what banner to put on the stores, I don't know. Safeway has the reputation it deserves in many markets; marginal at best. Albertsons reputation is probably worse in many markets, but it may have less ongoing baggage than Safeway has since most of the marginal stores under the Albertsons banner have closed and what is left of that banner is generally solid performing, modern, large, well assorted, well run stores. The lack of a mandatory loyalty card in the Albertsons format stores simplifies things there as well. I am not really sure it matters what name is on the store, as much as how they operate the store.

[pseudo3d]

Will be interesting to see how profitability is the next few years and how things go when they get the IPO going. If they can somehow reproduce what they are doing in Boise with those two new concept stores in other markets, I think they can get a lot of positive attention.

I have to wonder what direction Portland and Seattle will go. Safeway seems to be the stronger of the two names in both markets. With that said, Safeway seems to have cheapened the look of their stores. I think they need to consider building a handful of new stores, along with investing in some remodels, if for no other reason than to have something to justify their higher price point. The early Lifestyle stores seemed to be a similar idea, but as time went on the stores have been cheapened by random lighting retrofits among other things. We haven't seen those new Albertsons store designs outside of Boise yet, and as far as I know, this has not carried over to Safeway.

They seem to be trying to work on price. In my market, and a few other more competitive and less affluent operating areas of NorCal (Fresno and Redding) they are right there with the lower price operators (Smiths, Winco, etc.) now on many branded center store and produce items. We will see how long it lasts. Some items have already gone up from the first week's "new every day low price" and this is only week 4 of the program here in Reno... Customer traffic looks no different than before and there is zero enthusiasm among the employees about the changes, which are very positive and have great potential to grow traffic.

The Safeway banner and associated format is anemic and generally dismal. They need to try harder on everything (service, price, quality, freshness). They aren't exactly bad, but they are not performing up to their abilities. The marketing platform continues to be screwed up, the loyalty card program is poor, and pricing is too complicated. The lifestyle stores are very tired and not merchandised particularly well (way too much space for bottled water, soda, and chips). The lighting "enhancements" Albertsons has done do not look good.

Some of the remodels they have done (Colorful Lifestyle) are very nice. But they seem to be doing them cheaply and really need to ditch all remnants of Lifestyle like the floors, checkstand lights, etc. Even the Florida (Modern, as they call it) decor can look nice, but I have mixed opinions on that depending on the store location.

Albertsons best bet at this point is to strategically place some of those Boise Market Street concept stores in a variety of markets and get the execution right. It would greatly engage customers and employees alike. As far as what banner to put on the stores, I don't know. Safeway has the reputation it deserves in many markets; marginal at best. Albertsons reputation is probably worse in many markets, but it may have less ongoing baggage than Safeway has since most of the marginal stores under the Albertsons banner have closed and what is left of that banner is generally solid performing, modern, large, well assorted, well run stores. The lack of a mandatory loyalty card in the Albertsons format stores simplifies things there as well. I am not really sure it matters what name is on the store, as much as how they operate the store.

One inherent problem I've noticed with Albertsons Cos. stores in general is they're generally too small, especially in comparison with Kroger's larger Marketplace stores. They also need to expand out a little bit, but mostly by filling in holes left by the many market pull-outs over the years, and not straying off the reservation.

[Super S]

One inherent problem I've noticed with Albertsons Cos. stores in general is they're generally too small, especially in comparison with Kroger's larger Marketplace stores. They also need to expand out a little bit, but mostly by filling in holes left by the many market pull-outs over the years, and not straying off the reservation.

I'm not sure Albertsons really needs to go after those Marketplace stores, which are more or less a Fred Meyer type of store adapted for other markets. They carry a different mix of merchandise. With that said, they did move into a former Shopko for that new Meridian store so are at least exploring larger stores, and did purchase a former Kmart next to the existing Parkcenter store in Boise, although at this time it is not slated for a new store. However, the Parkcenter location could be one to watch if the Meridian store does well. There are plenty of former Kmart and Shopko stores that could be adapted if they want to move in that direction.

[pseudo3d]

I also noticed that Albertsons opened a new food manufacturing plant about a year in Riverside, California, which is a bit surprising to see them commit to food manufacturing after some sell-offs in the Northwest, manufacturing soups (which I thought was outsourced).

As an aside, it's across from a meat packing plant that was built for Fresh & Easy's meat packing.

[Bagels]

Albertson's does best in captive markets, where it's the dominate grocer. In competitive markets, including Southern California, Las Vegas and Denver... it doesn't do so hot, and really isn't making much progress. In SoCal, for example, Albertson's has twice as many stores as Kroger, yet nearly equal sales/market share- and it hasn't gotten any better post-merger. Ouch. It really isn't surprising - compared to Ralph's, their stores are dated and prices much higher. In markets where Albertson's faces little or no traditional compeition, its stores are much nicer (but the prices are still high).

IMO, I wouldn't be surprised to see Albertson's close more stores in SoCal alone in the next few years... than it opens chain-wide over the next 15 or even 20.

[Bagels]

I also noticed that Albertsons opened a new food manufacturing plant about a year in Riverside, California, which is a bit surprising to see them commit to food manufacturing after some sell-offs in the Northwest, manufacturing soups (which I thought was outsourced).

As an aside, it's across from a meat packing plant that was built for Fresh & Easy's meat packing.

The address listed on Alberton's business license for the plant, is the same addressed listed within Fresh & Easy's bankruptcy filing, apparently it was their fresh food plant. Looks like Albertson's is leasing it, and the manager came from F&E. Must've been a very favorable deal...

[pseudo3d]

I also noticed that Albertsons opened a new food manufacturing plant about a year in Riverside, California, which is a bit surprising to see them commit to food manufacturing after some sell-offs in the Northwest, manufacturing soups (which I thought was outsourced).

As an aside, it's across from a meat packing plant that was built for Fresh & Easy's meat packing.

The address listed on Alberton's business license for the plant, is the same addressed listed within Fresh & Easy's bankruptcy filing, apparently it was their fresh food plant. Looks like Albertson's is leasing it, and the manager came from F&E. Must've been a very favorable deal...

Further research shows that it was indeed F&E's main distribution center (at least one of them), with this link showing a picture and giving sizes consistent to the building; however, another source mentions it was the "Campus Kitchens" facility of F&E. In any case, I don't know if Albertsons owns it or leases it but it's probably not owned by Tesco anymore.

[veteran+]

Yes, that was the MAIN distribution center.

The Kitchen and Meat plants were around the corner in separate buildings.

They were state of the art facilities BUT possessed strange combinations of Euro design (U.K. mostly) and American design (electrical, plumbing, flow ,etc.).

Maintenance and adjustments were problematic for technicians!

Same issues for the Stores!