Friday, May 13, 2011

Supervalu has problems, and experts have opinions

A recent Forbes.com blog post pointed out that Supervalu (Acme and Save-A-Lot in these parts) has problems. "Revenue at Supervalu has declined each of the past two years, earnings have been negative for two of the last three years, and dividends have been declining as well..."

According to the blog post, Former Supervalu President Gene Hoffman questions the company's focus and wonders if its leadership has "the chops" to formulate and execute "a winning multi-front growth strategy."

In addition, a panel of experts consisting of retailers and consultants made a variety of suggestions. Emphasize price and value, and target Aldi's traffic, says a retail advertising exec. Focus on growing the retail formats, especially Save-A-Lot, says an industry consultant. Rely as much as possible on good regional suppliers and niche wholesalers, says an independent grocer.

As the author notes, Supervalu embarked on a three-pronged strategy of wholesale/supply chain, regional retailing and discount retailing. The big question that remains is whether the company, once the country's largest and most profitable food wholesaler and retailer, can survive with these three businesses intact.

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