Ahold's small format Bfresh stores coming to Philly

It was reported last week that leases were signed for Ahold Delhaize's small-format Bfresh store at 2300 Bainbridge Street and 3401 Chestnut Street, both in Philadelphia.  The Bainbridge store will be on the ground floor of a new condominium complex, and the Chestnut Street location is where Eastern Mountain Sports recently closed. A store planned for Second and South Streets was announced last year.

There are currently three operating Bfresh stores in Boston, MA. Fresh Formats, a subsidiary of Ahold Delhaize, has operated the Everything Fresh grocery store on Walnut Street in Philadelphia since 2014. The store serves as a testing ground for the company's small-format concepts.

Walmart, Kroger and Costco top list of 75 food sellers in US and Canada

Supermarket News released its annual list of the Top 75 Retailers and Wholesalers. The list ranks the largest sellers of food (by revenue) to be consumed at home in the United States and Canada.

Here are some bulleted highlights that I have copied word-for-word from Supermarket News. I would suggest visiting their website for the complete study.

• Natural and organic foods are still growing, but the retail beneficiaries aren't necessarily who they used to be;
• Formats serving low-income shoppers - while still some of the industry's fastest growers due to unit growth - have seen their sales in disarray as their shoppers deal with reductions to federal food benefit programs and rising costs for housing and health care, while a slowly improving economy may be lifting some of their shoppers out of the channel; and
• While Internet retailing remained a relatively small share of the pie, it became the subject of outsized ambitions by some of the industry's leading players, and a serious threat from digital natives like Amazon, which at year-end announced plans for a leap into the physical food retailing world. Initiatives to add click-and-collect shopping capabilities speak to a trend among food retailers to improve the convenience of their offerings to shoppers, and drive more sales from existing units, sources said.
• All this occurred while a nearly unprecedented stretch of deflating prices triggered chaos throughout the supply chain - an event analysts say could dampen sales at least through the first half of 2017.

Here are the top 10 retailers and wholesalers, plus other notable companies on the list.

1.  Walmart

2.  Kroger

3.  Costco

4.  Albertsons

5.  Ahold Delhaize

6.  Loblaw Cos.

7.  Publix

8.  Target

9.  C&S Wholesale Grocers

10. Walgreens

Also:

12. CVS

15. Dollar General

16. Supervalu

16. Wakefern

19. 7-Eleven

20. Trader Joe's

21. Aldi

22. Dollar Tree

26. BJ's Wholesale Club

30. Rite Aid

30. Wegmans

44. Weis Markets

54. Grocery Outlet

56. The Fresh Market

61. Amazon

Three Wakefern members were listed as separate entities on the list, including Saker ShopRite (56), Village Super Market (61), and Inserra Supermarkets (69).

Ahold-Delhaize trading as one entity, selling off stores to avoid antitrust concerns

Ahold-Delhaize began trading as a combined entity on Monday, July 25, a few days after the Federal Trade Commission issued a consent order allowing for the completion of the merger, subject to the sale of 81 stores due to antitrust concerns.

According to the company, agreements have been made to sell all 81 stores, plus an additional five stores that were included as part of negotiations with buyers in order to reach a package deal. Buyers include Weis Markets (38 Food Lion stores in Delaware, Maryland and Virginia), Supervalu (22 Food Lion stores in Maryland, Pennsylvania, Virginia and West Virginia), and Publix (10 Martin's stores in Richmond, Virginia), among others.

The FTC said the agreement is subject to public comment until August 22, after which the commission will decide whether to make the proposed consent order final.

Ahold and Delhaize approve company merger

Ahold and Delhaize shareholders approved the merger of the two companies last month, leaving approval from competition authorities in the United States and Europe as the final hurdle. Pending the necessary approvals, the deal is expected to close this summer.

In order to help facilitate the approvals, both chains are offering a combined 83 stores for sale, according to Food Trade News. The stores for sale are assumed to represent an overlap in markets where both stores exist.

According to published lists, there are four stores for sale in Pennsylvania (York, Waynesboro, and two in Chambersburg), all of which carry the Food Lion banner.

Ahold USA, headquartered in Carlisle, PA and Quincy, MA, includes Giant Food, Stop & Shop and Peapod, among others. According to the company's website, Ahold USA operates 770 supermarkets and 210 "pick-up points" in 14 states and the District of Columbia.

Delhaize America includes Food Lion and Hannaford, and operates 1,288 supermarkets in 15 states. The company's website reports that Delhaize America accounts for 66% of the overall company revenue.

Ahold and Delhaize to merge, form one of largest supermarket chains in U.S.

Ahold (Giant, Stop & Shop) and Delhaize (Food Lion, Hannaford) announced this morning that the two companies plan to merge and become Ahold Delhaize, creating one of the largest supermarket chains in the U.S. The merger would create a company with 2,000 U.S. stores (6,500 stores worldwide), $44 billion in sales and 375,000 employees.

By comparison, Kroger, the largest full-service grocery retailer in the U.S., has about 2,650 supermarkets.

The deal, which is expected to close next summer, needs to clear regulatory clearances and obtain shareholder approval.

Giant and Food Lion parent companies in merger talks

Ahold and Delhaize confirmed last month that they are in the early stages of merger talks, and analysts believe a deal could be struck this year. Ahold is the parent company for Ahold USA, which includes Giant Food, Martin's, Stop & Shop, and Peapod. The Delhaize Group includes Delhaize America, which consists of Food Lion and Hannaford. Both companies are based in Europe.

Analysts said that both companies combined produced sales of $60.5 billion last year, of which about 61% came from the U.S.

The companies discussed a merger in 2006, but an agreement was not reached.

Aldi to reopen 30 of 66 Bottom Dollar stores

Aldi announced last Friday that it will reopen 30 of the 66 Bottom Dollar stores it acquired from Delhaize. Aldi purchased the stores late last year for $15 million.

Here are the stores that will reopen under the Aldi banner:

New Jersey:

Bellmawr
Bordentown
Cherry Hill
East Windsor
Edgewater Park
Glassboro
Lumberton
Trenton
Woodbury

Pennsylvania:

Aliquippa
Allentown
Butler
Carnegie
Coatesville
Homestead
Lansdowne
Levittown
McKeesport
Nazareth
Philadelphia (5)
Pittsburgh (4)
Souderton
Willow Grove

Aldi will attempt to sell or sublease the 36 stores it does not plan to reopen.

Currently Aldi operates approximately 1400 stores nationwide, and the company has said its goal is to operate 2,000 stores by the end of 2018.

Bottom Dollar stores to close by January 15

On Friday Bottom Dollar Food said it would close all 66 locations by January 15, and all 2,200 workers would lose their jobs. The company said the employees would receive severance pay, and some would receive job counseling services.

Bottom Dollar, a subsidiary of Belgian-based Delhaize Group, announced in November it would sell its locations to Aldi, which has yet to announce its plans for the stores.

Related posts:

Bottom Dollar to sell its 66 stores to Aldi

Aldi hiring manager trainees, but no word on Bottom Dollar plans 

Bottom Dollar to sell its 66 stores to Aldi

Delhaize Group announced yesterday that it has reached an agreement to sell all 66 Bottom Dollar Food stores to Aldi for approximately $15 million. 46 of the stores are in the Philadelphia region.

Bottom Dollar will continue to operate its stores until the end of the year, at which time all the stores will close. The transaction is expected to be completed by the end of March, 2015.

Aldi, which will assume all of Bottom Dollar's lease liabilities, has not yet announced its plans for the 66 stores.

Related story (8/19/2014): Delhaize may pull the plug on Bottom Dollar

Delhaize may pull the plug on Bottom Dollar

Food Trade News reported in its August issue that Bottom Dollar Foods, a division of Delhaize America, "has reportedly felt enough competitive heat and is exploring the sale of its 66 stores located in Pennsylvania, Southern New Jersey and Northeast Ohio." 46 of the 66 stores are in the Greater Philadelphia market.

Reportedly several retailers received profile sheets in July and bids for the stores were due on August 13. In addition, Food Trade News learned that Wells Fargo is serving as Delhaize America's investment advisor.

Analysts believe that Delhaize is trying to sell all 66 stores rather than sell individual locations or groups of stores. Supervalu (Save-A-Lot) and Aldi are leading contenders.

According to information that Food Trade News obtained, all but 10 Bottom Dollar stores are leased. The stores typically have significant term remaining and rents of about $10-$12 per square foot, although they range from $1.76 (most likely a ground lease) to $26.23. Store sizes run from 16,848 to 30,352 square feet, with most closer to 20,000 square feet. Weekly sales volumes range from $103,000 to $296,800, with an average weekly volume of $156,802. 

Bottom Dollar entered the Greater Philadelphia Market in 2010, and many industry observers were skeptical. Discount operators like Aldi and Save-A-Lot were already in the market, not to mention PriceRite, dollar stores and Walmart Supercenters. 

Referencing Bottom Dollar locations, the Food Trade News story quoted a veteran merchant as saying "You get what you pay for... After seeing what their operating model was it was pretty clear that their questionable site selection would not be beneficial."

Supermarkets among top retail chains in the world

A report published by Deloitte Touche Tohmatsu and Stores Magazine last month claims that 32 of the 100 largest retail chains in the world are supermarket chains. And in the U.S., 20% of the retail chains on the top 100 list are supermarkets. The list includes the following grocery chains:

Kroger - #5
Safeway - #24 (prior to the sale of the company's Canadian unit and closing of the Dominick's chain)
Delhaize - #33
Supervalu - #35
Publix - #36
H-E-B - #51
Whole Foods - #91

Also of note:
Walmart - #1
Tesco - #2
Costco - #3
Target - #10
Dollar General - #56
BJ's Wholesale Clubs - #88

Walmart, Kroger, Costco boast top sales volumes for U.S. food retailers

Last month Supermarket News released its annual ranking of the Top 75 Food Retailers and Wholesalers in the United States. The top 10 remained the same from last year, with the exception of Supervalu, which dropped from six to 16 as a result of the sale of 877 Albertsons stores in 2013.

The top 10 retailers are as follows (local banners are listed in parenthesis):

1 - Walmart
2 - Kroger
3 - Costco
4 - Target
5 - Safeway
6 - Loblaw
7 - Publix
8 - Ahold (Giant)
9 - 7-Eleven
10 - Albertsons

 Other companies of note include the following:

14 - Delhaize (Bottom Dollar, Food Lion)
16 - Supervalu (Save-A-Lot)
18 - Wakefern (ShopRite, PriceRite, Fresh Grocer)
19 - Whole Foods
20 - BJ's Wholesale Club
21 - Trader Joe's
26 - Aldi
30 - Wegmans
32 - A&P (Pathmark, Super Fresh)
46 - Weis Markets
59 - Saker ShopRite
65 - The Fresh Market
66 - Village Super Market (ShopRite)
68 - Grocery Outlet (Amelia's)
74 - Inserra Supermarkets (ShopRite)

Bottom Dollar, Giant opening stores; Weis to close a store

New Bottom Dollar stores opened today in Ambler, PA and in the Germantown section of Philadelphia. These stores represent the 42nd and 43rd stores in the Greater Philadelphia Market. Bottom Dollar now operates 62 stores in PA, NJ and OH. The discount grocery chain, a subsidiary of Delhaize, is still not profitable.

Giant Food is scheduled to open on November 6 in a former Genuardi's location in Edgemont Square Shopping Center, Newtown Square, PA. The store, which has been vacant since 2010, is 43,000 SF. Giant, a division of Ahold, has about 200 stores in PA, MD, VA and WV.

Weis Markets announced last week that it will close its Pottstown supermarket in the next couple weeks due to "continuing under-performance." The 45,228 square foot store opened in 1995 and is in the same shopping center as Walmart. A new Giant opened in the last couple years less than a mile away. Despite the closure, Weis seems to be opening and renovating several stores.

 

Cerberus exploring a deal to takeover Safeway

According to a report from The Chicago Tribune, Cerberus Capital Management is exploring a deal for all or part of Safeway, the second-largest supermarket operator in the U.S. In addition, Supermarket News said this morning that according to a Reuters report, Safeway has engaged Goldman Sachs to explore a potential private equity takeover.

Safeway, which exited the Philadelphia market by selling or closing its Genuardi's stores (with the exception of one remaining store in Audubon, PA) and recently announced that it plans to exit the Chicago market by selling its Dominick's chain, just received clearance from Canada to sell its 212 stores there to Empire Co. for $5.8 billion in cash.

Earlier this year, Cerberus led an investor group that included Kimco in a $3.3 billion acquisition of a group of supermarket chains from Supervalu that included Acme, Albertsons and Jewel-Osco.

Other grocery deals completed this year included Kroger's $2.5 billion acquisition of Harris Teeter, Bi-Lo Holdings $265 million purchase of three Delhaize chains, and Spartan's acquisition of Nash Finch.

Safeway has experience with private equity, as KKR took the supermarket chain private in 1986. KKR sold its stake 13 years later and reportedly made a $7 billion profit.

According to Safeway's website, there are currently over 1,600 Safeway stores in the United States and Canada. Banners include Safeway, Vons, Dominick's, Randalls, Tom Thumb and Carrs.

Bottom Dollar opens 40th store in Philly market

Bottom Dollar's new store in Levittown, PA, which opened last week, is the discount grocer's 40th store in the Philadelphia market. Overall, the company operates 59 stores in New Jersey, Pennsylvania and Ohio. Bottom Dollar is a division of Food Lion, which is owned by Delhaize.

Sales increase at Food Lion, Bottom Dollar still not profitable

Delhaize Group sales and earnings increased in the company's second quarter due in part to sales increases at Food Lion, according to a company statement issued last month. U.S. sales for Delhaize, which includes Food Lion, Hannaford and Bottom Dollar, improved 0.4% to $4.25 billion, as compared to the same period one year ago.

Margins improved from 3.7% to 3.8%, and profits in the U.S. were up by 4.9% to $162 million.

Although Bottom Dollar is still not profitable, Delhaize says the chain is making significant progress on cost and productivity initiatives and is continuing to gain new shoppers.

Bi-Lo to buy three banners from Delhaize

Bi-Lo Holding, which operates Bi-Lo and Winn-Dixie supermarket chains in eight southern states, announced yesterday that it has agreed to acquire Sweetbay, Harveys and Reid's stores from Delhaize for $265 million. Delhaize owns Food Lion and Bottom Dollar Food, among others.

According to a Supermarket News report, there are 165 stores included in the transaction that generated revenues of about $1.8 billion last year. The same report claims that Sweetbay currently has 72 stores in Florida, Harveys has 72 stores in Georgia and Florida, and Reid's has 11 stores in California. (72+72+11=155.)

The sale is expected to close later this year, pending regulatory approval.

Delhaize considering sale of Sweetbay and Harveys

According to multiple reports today, Delhaize Group, which owns Food Lion and Bottom Dollar Food, has hired an investment bank to assist in the possible sale of its Sweetbay and Harveys brands in the U.S. Sweetbay, which is in Delhaize's Hannaford division, operates 72 stores in Florida. Harveys is in the Food Lion division and operates 73 stores, mostly in Georgia.

Delhaize reports lower losses at Bottom Dollar

Delhaize Group announced first quarter earnings earlier this week and said the company's performance in the U.S. was boosted in part by "lower losses at Bottom Dollar Food." U.S. operating profit for Delhaize increased to $197 million for the quarter, a 14.1% increase compared to the same time period a year ago. Operating margins improved to 4.2% of sales as compared to 3.7% in the first quarter of last year.

The company is in "phase four" of its repositioning effort for Food Lion, and has begun a "fresh round of price investments" at Hannaford Bros.

As for Bottom Dollar, Delhaize has not opened a new store in the past nine months, but future openings are planned for the Philadelphia and Pittsburgh markets.

Delhaize America to cut 500 jobs

Delhaize America, the parent company of Food Lion, Bottom Dollar and others, announced yesterday that it will eliminate 500 jobs as part of a corporate reorganization. The jobs lost will be "above the store manager level" and will include 350 current employees as well as 150 open positions.

Yesterday's announcement follows last month's news that 33 Sweetbay stores, eight Food Lions and three Bottom Dollar locations would close. The Bottom Dollar stores are all in Pennsylvania (North Wales, Chalfont and Reading).

1/18/2013 story: Three Bottom Dollar stores to close in PA