Albertsons Officially Reunited!

[marshd1000]

Here are two articles about the reuniting of the previously separate Albertsons chains.

http://www.idahostatesman.com/2013/03/2 ... rt-of.html

http://www.supervaluinvestors.com/phoen ... highlight=

[Super S]

It is going to be interesting watching which direction the "new" Albertsons will go. The Supervalu stores really lost their focus...pricing no longer competitive, dirty stores, reduced lighting, quality of products in bakery/deli/produce, and very cheap looking remodels when remodels were actually performed. Quite a few stores have also closed.

There was a loss of consistency when there were two separate companies operating under the same name and logo. Hopefully some consistency, and some standards, will return. Albertsons has the potential to turn itself around, but it is going to take some effort to gain back customers.

[Alpha8472]

Supervalu really ran those Supervalu-owned Albertsons into the ground. I don't know if Albertsons, LLC can salvage the situation. It is going to take some time before all those awful changes can be reversed.

Albertsons, LLC in recent years has been running their stores quite well. It was strange that Albertsons, LLC was headquartered in Boise and was surrounded by Supervalu owned Albertsons stores that were doing very poorly even in the original hometown of Albertsons.

Hopefully this will put an end to the ugly remodels done by Supervalu. Jewel-Osco once had beautiful stores featuring the Jewel interior. Then Supervalu started their remodeling which ripped out all of the fancy wood trim and painted all the walls white. Plain white walls and plain floors really made their stores look sterile and bland. All that money on remodels was a waste and made the Jewel-Osco stores look worse. If I were to choose, I would bring back the Jewel-Osco decor. It made it feel like you were shopping in a high class supermarket.

Albertsons, LLC will have to make some sweeping changes. Prices need to be lowered, stores need to be cleaned up, store lighting needs to be improved, staffing levels need to be improved, etc. It is going to take some investments in pricing and staffing to win back customers.

[wnetmacman]

I believe they can pull it off.

Recently, the LLC remodeled the remaining stores in Lafayette, LA. They took out what I considered the overdone last packages of the original company, and gave the stores a really nice remodel, with new paint, straight line shelves and large department signs, in addition to moving the pharmacy out of the middle islands and back to the outer walls. The stores look good and modern now. If the combined company can afford to roll this out, it can be a real contender.

I don't believe SVU did that much damage. I think they can all weather this. Jewel is still #1 in Chicago. Acme is still running well in Philadelphia, and Shaws still exists in New England. When you combine all this with the LLC stores throughout the south and southwest, they can be a good contender.

[Super S]

I don't believe SVU did that much damage. I think they can all weather this. Jewel is still #1 in Chicago. Acme is still running well in Philadelphia, and Shaws still exists in New England. When you combine all this with the LLC stores throughout the south and southwest, they can be a good contender.

I beg to differ here. Albertsons was in expansion mode in Washington and Oregon through most of the 1990s, and kept their stores clean, and had good quality and competitive prices. Albertsons started to falter when they implemented the Preferred card, people got the image that they were just trying to copy Safeway. Things got worse when Supervalu took over, a lot of those stores that were built or last remodeled in the early-mid 1990s did not receive proper upkeep. Many ended up closing in Portland, Oregon and Vancouver, Washington, and the remaining received minimal, cheap-looking remodels. Most ended up removing about half of the fluorescent tubes. There are areas of Portland which Albertsons has nearly abandoned, as well as several smaller towns such as The Dalles where there are no other Albertsons stores close by. Walmart is now in aggressive expansion mode in this area, building several new "neighborhood market" stores. WinCo is remodeling and replacing older stores, and Fred Meyer & Safeway continue to remodel. Albertsons is perceived by many as a mediocre store that does not offer anything that stands out these days, and the empty parking lots illustrate that people tend to go there as a last resort.

Albertsons used to have very good bakery, deli, and meat departments, and decent produce. They also used to have higher standards for customer service and cleanliness than they do today, where they are sometimes inconsistent from one store to another. If these areas are addressed, Albertsons could be a contender again.

[klkla]

I believe they can pull it off.

But they may not want to pull it off in all cases. Cerberus at it's heart is in business to derive the greatest benefits from it's assets not a grocer per se. Based on their past history if there are good offers to buy divisions or large chunks of the company (think SaveMart's acquisition of Northern California stores and Publix' cherry picking the best Florida locations).

In the end they will do a better job of managing the stores they keep compared to Supervalu, but I wouldn't be at all surprised to see significant asset sells either.

[storewanderer]

I hope they can pull it off. But I see a lot of store closures and a lot of asset sales. It is not going to be an easy road. Albertsons Stores in a lot of places have just been run into the ground. I believe the damage has been done at this point in a lot of different places to a point that short of a complete rebranding, the stores cannot be turned around. For example, stores around Los Angeles, and a lot of the stores around Seattle. These stores are just in horrible condition. They are dirty, poorly run, have by far the highest pricing in their markets, poor customer service, poor promotions... they basically do nothing well. Selection/mix is passable on center store but when you combine it with the price/promotion issues and the lousy fresh departments it is hardly a redeeming factor.

And Shaws is a disaster. That group of stores... I'd dump those off as fast as possible. Awful, awful stores. I think a smaller, profitable Acme is possible. And Jewel operating on a profitable basis on an ongoing basis is obviously very attainable.

The asset sales will be interesting. With how the buyers of prior Albertsons assets have done (Save Mart's disaster in NorCal, the groups in Oklahoma who bought stores and are obviously not doing well, Associated in Utah's complete fiasco with the stores they bought), I am wondering just who will buy these stores, at least on a large scale.

I see LLC "pruning" the store base down to good, profitable stores. If you look at what Albertsons once had in Colorado, for example: they had a decent store count (still third place distantly, but a noticeable presence throughout Denver and Colorado Springs). The problem with that decent store count was it was a weird range of stores from nice early 2000's stores to old Skaggs Albertsons Combo Stores from the 1960's with shelves separating the Albertsons half from the Rite AId half. Now fast forward to the current Albertsons LLC model in Colorado: most locations are closed. The locations left are all newer stores; early 1990's at the very oldest. Quite a few have been remodeled, and the stores are doing well to very well, and operationally they look fantastic. I would shop them in Colorado over Safeway every time and over King Soopers a good chunk of the time too. Why? Better pricing on some of the fresh departments, nicer looking stores, friendlier employees. King Soopers may be one of Kroger's best divisions but I've had some of my worst Kroger service experiences there, multiple times.

[Alpha8472]

I agree that some Albertsons stores in certain areas are in such bad shape, that the only hope would be to rebrand those stores as something else. The Albertsons name is so tainted and hated that the name should be dropped.

What name could they use? I know we've been through this many times before, but Albertsons still owns the Lucky name.

Bring back the Lucky name. When Save Mart revived the Lucky name, the Albertsons stores saw huge crowds of people. People were celebrating the return of Lucky and for some time those stores were doing great business. I think that Albertsons, LLC can pull it off. Bring back the low prices at least for the short term, and refresh those stores with new remodels. Bring back the Lucky lady and those memorable and sometimes quirky commercials.

It's either that or rebrand to Jewel-Osco and bring back the unique Jewel Interior decor.

[wnetmacman]

Cerberus at it's heart is in business to derive the greatest benefits from it's assets not a grocer per se. Based on their past history if there are good offers to buy divisions or large chunks of the company (think SaveMart's acquisition of Northern California stores and Publix' cherry picking the best Florida locations)..

If I weren't seeing them open new stores and massively remodel old ones here, I'd believe they were still on that tangent. The remodeled stores here look really good. Like they put some real thought into them.

[storewanderer]

Oh I think they will operate stores on an ongoing basis, the Albertsons LLC, there is no question in my mind about that. With how they are operating the 200 stores they have, it is clear to me they are in the business to operate stores.

I am just not sure how many stores they will keep operating...

I think the plan will be to sell assets to "pay" for the stores they bought, but keep some of them. Basically just like they did with the first batch of stores.

The one thing they have demonstrated is any store they have is for sale, at the right price... and they will sell.

I agree about their remodels, and also their in-store execution on fresh departments. Excellent- in Colorado and Arizona. Decent, but not as good, in Albuquerque. Not so good in Dallas... Price still needs work... their scale in Phoenix/Denver/Albuquerque is pretty good but the scale in Dallas was awful... but is definitely no worse than Safeway and in some cases better.