Survival of the Fittest

Time predicts a continual struggle for grocers.

August 19, 2010

Citing A&P, a retailer that once had more than 13,000 stores and recently "announced its umpteenth restructuring" that will bring its current total to just over 400 stores, the article said A&P is not alone in its downsizing. "There is no growth to be had. There will be casualties." And the evidence to support this thesis is growing:

Southeast grocer Winn Dixie recently announced a restructuring, and BI-LO, another southeasterner that recently emerged from bankruptcy, is for sale.

While a common scapegoat is Walmart, the article took a measured approach: "[I]n New York City, where A&P has had a strong presence for more than a century, there are no Walmarts."

Pricing competition has put a dent in the traditional chains, like Safeway, which are "neither as cut throat on pricing as the low-end stores nor as good on merchandising or specialty foods as the fancier outfits."

As an example, the piece said Winn Dixie has never found a way to best Publix, its regional rival. And in the meantime, Walmart chipped away market share on the price front, grabbing some of Winn Dixie's traditional blue-collar shoppers.

A&P has tried a variety of tactics, including going upscale, going downscale, and buying competitors, which has left it with an inconsistent operating style but some strategic store locations €" "which may be about the best thing the company has to sell these days," according to Time.
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