Safeway Reports 4Q Loss of $1 Billion

AP via Austin American-Statesman ^ | 2/6/03 | MICHAEL LIEDTKE

[PAR35]

SAN FRANCISCO (AP)--Slumping supermarket giant Safeway Inc. reported a fourth-quarter loss Thursday of $1.05 billion, reflecting the grocer's continuing headaches with two major acquisitions in Texas and Illinois.

The loss of $2.37 per share for the October-December period contrasted with a profit of $353.6 million, or 70 cents per share, the previous year.

Fourth-quarter sales totaled $10.01 billion, up from $9.93 billion a year earlier.

Safeway absorbed $1.5 billion in fourth-quarter charges to account for troubles at two grocers, Houston-based Randall's and Chicago-based Dominick's, that it bought for a total of $2.5 billion during the late 1990s.

{snip}

Besides sustaining losses on the Randall's and Dominick's deals, Safeway battled sagging sales in a sluggish economy that tightened household budgets and drove more shoppers to buy groceries at discounters such as Wal-Mart and Target.

{snip}

[JoeSchem]

Safeway has always had high prices.

Combine that with so-so merchandise and selection

Every time I've done comparison shopping, Safeway has come out ahead. I'm not being an apologist; I'm simply wondering if there's some regional variation here. If you can find Banquet frozen dinners for less than $1 in the Greater Seattle area, let me know.

[cynicom]

Wegmans is rated number one in the country. I have never seen any chain bigger or smaller that could match them.

[FreedomPoster]

>>The Safeway here makes it a practice of employing retarded adults as baggers, and they are far more friendly and competent than your typical punk teenage bagger.

There's an interesting societal story in that line. It isn't pretty.

[petuniasevan]

I lived in Northern California when I made the comparison.

Even Albertson's was cheaper more often than not.
Lucky's was cheaper (though their selection was iffy).
Raley's had better selection and quality for the price.


Fred Meyer, while it existed in Chico, had them all beat.

[Temple Owl]

I used to go to Genaurdi's. Now I go to Acme. You are right. They are clean stores with excellent merchandise at competitive prices. And the employees for the most part are helpful and courteous.

[PAR35]

believe it or not, vons was the 1st supermarket in the united states, beginning in 1941 or 42 in los angeles by the vons brothers.

Following a concept pioneered by Piggly Wiggly more than 20 years earlier:

" the first Piggly Wiggly opened September 6, 1916 at 79 Jefferson Street in Memphis. Operating under the unusual name Piggly Wiggly, it was unlike any other grocery store of that time. Shopping baskets, open shelves, no clerks to shop for the customer -- unheard of!"
http://www.pigglywiggly.com/cgi-bin/customize?aboutus.html

[Big Horn]

Walmart has crappy meat and some of the prices are high. I hope we don't lose all the stores but Walmart.

[liberalnot]

i remember going to a piggly wiggly with my relatives in colorado about 1951-53.

it was much like what we expect these days in supers, but it lacked a bakery, deli, etc., which the authors of the vons article cite as a requirements for a "supermarket", developed by the vons brothers in 1941.

so, there you have it.

[plusone]

Is this the store that has the customer cards that keep track of your purchases?

[petuniasevan]

Many if not most stores use customer cards now.

Detractors point out "They keep track of what you purchase!"

Well, of course they do. How else will they know what to order for inventory replenishment? More to the point, how else can they keep close tabs on the various factors in their customer base: Buying habits, age groups by percentage, neighborhoods, average amount purchased, grocery categories purchased, peak times for various categories, holiday shopping habits, etc.

I've noticed that supermarkets have fuller shelves, better selection, and quicker response to customer feedback within the last few years. It's a dog-eat-dog world in grocery retail - any way to gain the edge over your competition is welcomed.

Are you old enough to remember in the 1970s the dingy, badly-stocked markets? Remember the glum union stockboys stamping prices on cans of peas?

No, those weren't the "good old days".

[kAcknor]

Many if not most stores use customer cards now.
Detractors point out "They keep track of what you purchase!"

kAcknor Sez:

Yes, they do keep track, and that is not something I wish to have done to me. Inventory does not require my name, and worse, the card has turned into more than just a 'tracking tool', it has become a profit item.

When they cards first came out, there were some very good deals associated with them, but after about a month, the deals evaporated and left behind the stink of price gouging. Today you need a card to get the regular everyday price, but fail to have it and (please excuse my french..) you get 'ripped a new one'.

As for competition, we have 5 or 6 major markets in the Columbus area, three of them use cards and three do not. Not surprisingly, the three that require them are the three weakest financially. I shop mostly at Wally World and a local independent chain, Mejier, sans cards. Mejier manages to compete on just about every level with Wal-Mart, and beats them in a lot of places (their ammo prices are GREAT :).I haven't completely stopped shopping elsewhere, I just returned from Kroger (pineapple for the ham.. Yum!!), and again, to get a decent price I had to used that bit 'o plastic, but it's a card that has no name associated with it. ;)

"tIqIpqu' 'ej nom tIqIp" (Hit them hard and hit them fast.)

Have you checked the *bang_list today?

[kAcknor]

Walmart has crappy meat and some of the prices are high. I hope we don't lose all the stores but Walmart. 

kAcknor Sez: Mrs. Kacknor says the same thing. ;)

"tIqIpqu' 'ej nom tIqIp" (Hit them hard and hit them fast.)

Have you checked the *bang_list today?

[kAcknor]

When they cards = When the cards

oops (again, forever & always)

Deal with it. I have to. LOL

[Mjaye]

Great grocery store history, thanks. When Safeway bought out Von's and took over Pavilion, my local store, I saw a difference in quality. Now my local store is in a major remodeling phase, which is confusing if Safeway is in trouble.

Come to think of it, though, they dispensed with the convenient shorter aisles in favor of l-o-n-g ones, presumably to get people to do more impulse shopping. I hate when they rearrange comfortable stores, now I forget to buy things 'cause I didn't see them. I never used to need a list. Rant over.......

[PAR35]

Using a definition of an in-store bakery, I didn't shop in a supermarket until about 1992.

If you're ever in Memphis, you can visit a mock up of the first P-W in the museum on Mud Island. It's about the size of a small 7-11.

[liberalnot]

culture varies across the united states. my father is a dairy farmer and would have nothing of the french breads nor nyc bagels that i like. store-bought bread works for him.

you can imagine that a deli and fresh bakery in a store in 1941 was designed to get hollywood money.

i grew up in colorado and western nebraska in the fifties. there was one safeway and the in-store baked goods came from a fifty gallon drum of dough. i think they were very creative in the way they used this dough, for all most anything! a different shape yielded a different pastry, or so my friend's mother who worked in a safeway told me.

it was a far cry from the fresh european bread, fresh french croissants (made by french immigrants), and nyc bagels (made by nyc immigrants) that appeared in colorado circa 1970. by then people were rebelling against wonderbread. one of my best friends worked at the denver international bakery, i.e., wonderbread. strange working hours: one day they went to work at 2 a.m., the next day 3 a.m., the next day 4 a.m., and so on, around the clock. my friend always seemed "out of it" from this bizarre schedule. but he dare not complain because his father worked there too. i couldn't think of a better torture than a this work schedule.

there were several piggly's in my hometown in colorado. but they went under in the sixties with the expansion of the denver-based king soopers. in the nineties steele's markets went under due to the combined pressure of king soopers (by then owned by kroger), safeway, and albertsons.

considering that the markup in the super business is very low, expect some blowouts in the next decade, as wal-mart continues undersell.