Retail Watchers

I don't think the wholesale grocery business has real great expansion potential right now. We have seen a fair amount of consolidation of smaller wholesalers (AWG just announced a buy/merger with Affiliated Midwest last week). Most of the concepts who are expanding are either self distributed or rely on alternate suppliers like UNFI or Kehe for product (the large chains pull from those also... it seems to me these "conventional" grocery wholesalers really missed the boat not getting into the gourmet/natural/organic segment in a big way). Supervalu is in a really tough spot... there was a time they were supplying a fairly large base of franchise Cub Stores, a fairly large base of Super Targets, and even a handfull of Super Kmarts. As they lost that business for one reason or another, they developed Save a Lot which seemed to help distract from those losses.

At this point I think Supervalu needs its corporate stores just to keep some distribution centers viable. I think the thought of Albertsons buying anything else near-term is questionable but we will see (except I could see them take some Rite Aids over...) at this point given their current state of operations and lack of profitability.

storewanderer wrote:I don't think the wholesale grocery business has real great expansion potential right now. We have seen a fair amount of consolidation of smaller wholesalers (AWG just announced a buy/merger with Affiliated Midwest last week). Most of the concepts who are expanding are either self distributed or rely on alternate suppliers like UNFI or Kehe for product (the large chains pull from those also... it seems to me these "conventional" grocery wholesalers really missed the boat not getting into the gourmet/natural/organic segment in a big way). Supervalu is in a really tough spot... there was a time they were supplying a fairly large base of franchise Cub Stores, a fairly large base of Super Targets, and even a handfull of Super Kmarts. As they lost that business for one reason or another, they developed Save a Lot which seemed to help distract from those losses.

At this point I think Supervalu needs its corporate stores just to keep some distribution centers viable. I think the thought of Albertsons buying anything else near-term is questionable but we will see (except I could see them take some Rite Aids over...) at this point given their current state of operations and lack of profitability.

Like I said, Albertsons would probably like some of the brands they sold SuperValu but that's the last thing SVU would want to sell. Albertsons opportunistic buying since the LLC days (usually in/adjacent to their existing markets) doesn't really fit with SVU's scattered operations (even if they were to sell them off at a good price, and they can find better buyers than Albertsons), and even Shoppers has too much overlap to really make it a good purchase in and of its own.

SuperValu does have the Albertsons Wild Harvest line, which expanded under SuperValu but that's not going to save them. As for wholesaling, they just don't seem to have the "store involvement" AFS has or major clients like C&S has. Years from now, I wonder how Gross is going to be viewed as a CEO...I can easily imagine people blaming him as a moron who slew the goose with the golden eggs (that would be the Save-a-Lot spin-off), watched their existing retail stores have their sales plummet and shrivel up, and clung onto a stagnant industry. But no one knows the future...

I think Albertsons is pretty proud at this point of the Safeway private label line.

Although I thought Wild Harvest was a good line, liked the packages, thought it was a good name for an in-store nutrition department, and think it is a catchy name... I am not sure they would let go of O Organics which is by quantitative measures a more successful line than Wild Harvest.

Maybe they could merge Bright Green, O Organics, and Open Nature all into a "Wild Harvest" or "Wild Harvest Organic" line similar to how Kroger's Simple Truth line is set up. That Simple Truth line is exponentially more successful than all of its previous lines (Private Selection Organic, Naturally Preferred, Kroger Organic, who knows what else). It is also being priced more sharply than the others ever were and promoted more heavily...

storewanderer wrote:I think Albertsons is pretty proud at this point of the Safeway private label line.

Although I thought Wild Harvest was a good line, liked the packages, thought it was a good name for an in-store nutrition department, and think it is a catchy name... I am not sure they would let go of O Organics which is by quantitative measures a more successful line than Wild Harvest.

Maybe they could merge Bright Green, O Organics, and Open Nature all into a "Wild Harvest" or "Wild Harvest Organic" line similar to how Kroger's Simple Truth line is set up. That Simple Truth line is exponentially more successful than all of its previous lines (Private Selection Organic, Naturally Preferred, Kroger Organic, who knows what else). It is also being priced more sharply than the others ever were and promoted more heavily...

Perhaps. On a related note, despite the presence of Wild Harvest and its SuperValu-led expansion, I think that Wild Harvest is not quite as valuable as SuperValu thinks it is, especially as better wholesalers are expanding their organic/natural lines.

Anyone thinks that Shoppers may be planning a return to its' roots? The mid-2000s package from when SuperValu tried to make Shoppers more luxury is near extinction (surprisingly...), and its' later counterpart is starting to disappear too. Simply described, it's the more basic look of the SuperValu era, and while it lacks the warehouse connotations, that can easily fit right in just in case. It's bland, sure, but there have been improvements since the (now-closed) Manassas East store with this look remodeled back in 2011. It is brighter, flashier, and more detailed nowadays in the newer versions, even if it does not look that good in the SuperValu-era newbuilds.

Without a picture, it's hard to tell for sure, but sounds like cutting capital expenditures for remodels and only giving it a more bare-bones appearance.

pseudo3d wrote:Without a picture, it's hard to tell for sure, but sounds like cutting capital expenditures for remodels and only giving it a more bare-bones appearance.

Indeed... it's SuperValu style, and Shoppers seems to have much more of a basic theme and color palette than the rest of the stores. There is a rather colder feeling than any of the previous remodels, but, as I've said, there have been measurable improvements to later installments and it's all a nice starting point.

From what I've speculated, this all may be part of a plan to update their stores to the modern age in a cheap and quick manner to possibly obtain a future suitor, who can then do better with Shoppers.

If you haven't seen it, check out some of the albums on Flickr by user Will/B-More Retail. They will give you some good guides.

BatteryMill wrote:Anyone thinks that Shoppers may be planning a return to its' roots? The mid-2000s package from when SuperValu tried to make Shoppers more luxury is near extinction (surprisingly...), and its' later counterpart is starting to disappear too. Simply described, it's the more basic look of the SuperValu era, and while it lacks the warehouse connotations, that can easily fit right in just in case. It's bland, sure, but there have been improvements since the (now-closed) Manassas East store with this look remodeled back in 2011. It is brighter, flashier, and more detailed nowadays in the newer versions, even if it does not look that good in the SuperValu-era newbuilds.

I don't really think Shoppers or any, or all of the Supervalu-owned chains (Cub, Farm Fresh, etc...) are going to stick around much longer. Save A Lot was just sold off and their other retail operations, including Shoppers, aren't really that great in any of their geographic markets in terms of number of locations, pricing, etc. Maybe SuperValu will give the better performing ones some minor touchups to make it more appealing to another operator (not really sure who else would want them on a large scale except for Kroger, but they already have a lot to absorb from their recent purchases).

mbz321 wrote:

BatteryMill wrote:Anyone thinks that Shoppers may be planning a return to its' roots? The mid-2000s package from when SuperValu tried to make Shoppers more luxury is near extinction (surprisingly...), and its' later counterpart is starting to disappear too. Simply described, it's the more basic look of the SuperValu era, and while it lacks the warehouse connotations, that can easily fit right in just in case. It's bland, sure, but there have been improvements since the (now-closed) Manassas East store with this look remodeled back in 2011. It is brighter, flashier, and more detailed nowadays in the newer versions, even if it does not look that good in the SuperValu-era newbuilds.

I don't really think Shoppers or any, or all of the Supervalu-owned chains (Cub, Farm Fresh, etc...) are going to stick around much longer. Save A Lot was just sold off and their other retail operations, including Shoppers, aren't really that great in any of their geographic markets in terms of number of locations, pricing, etc. Maybe SuperValu will give the better performing ones some minor touchups to make it more appealing to another operator (not really sure who else would want them on a large scale except for Kroger, but they already have a lot to absorb from their recent purchases).

I do not know of that case, but if they are mismanaged, well, down they go to the retail graveyard with Kmart/Sears and about ten other retailers succumbing to Amazon. There would be some more focus, I'd say, and as for the touch-ups, aren't they doing just that? Now to find the best suitor.

If Supervalu put Shoppers up for sale who would be buying? Shoppers does have large stores inside the Beltway so they might make sense for someone like Giant or Safeway. Giant could take the Seven Corners store as Safeway has a nearby location. And Safeway could take Potomac Yards since Giant just built a replacement for the Del Ray store close to the lower end of the Potomac Yards developments. However, outside the Beltway becomes a bit more challenging. Giant and Safeway already have stores near most of the existing Shoppers locations. Exceptions I can think of would be the White Flint and Fair City Mall (Fairfax) stores. Kroger is already in town with Harris Teeter and they seem to be going for new construction in "upscale" and transit oriented neighborhoods. There doesn't seem to be a Shoprite owner who wants to take a shot at the Washington DC market as much as I would love one of them to come down here. The only other major grocer who is in expansion mode is Publix. But based on comments elsewhere on Retail Watchers and comments on Flickr photos Publix would not go for an existing union shop. They are non-union, hire their own staff and don't want to be mixed up in a mess over the UFCW claiming a store must continue as union even with a new operator. Publix has told the Martins employees of the stores they are purchasing in Richmond that they must reapply with Publix. No jobs carry over. It has been strongly rumored that Publix is looking towards Northern Virginia as their next stop going north. The ironic thing is that if Publix could get a hold of existing Shoppers locations, without worry over the union and who Publix hires, Publix would be getting stores in solidly middle class, stable neighborhoods. Sure they aren't the super high end places that the image of Publix seems to gravitate towards. However these are neighborhoods that have basically had a triopoly of Giant, Safeway and Shoppers for many years. I would think they would welcome a new and highly regarded grocer to the neighborhood.