Note: The news sites linked from these stories are constantly being updated. As a result, some links may no longer be valid.
According to a December 19, 2001 announcement, ShopperTrak and RCT, two companies that monitor the activities of shoppers in the nation's stores, intend to merge. ShopperTrak uses two products, Orbit II and Executive Sandbox, to gather and report the movement of shoppers in retail environments, e.g., the travel path of customers through a store, how long people linger at given counter etc. RCT provides reporting on shopping trends for retail establishments, such as the traffic in malls nationwide for a given day or weekend. Much of this information is gathered via unobtrusive video surveillance cameras and devices. What happens when these tools are employed by a retailer and combined with credit card or loyalty card purchase information? Should we be concerned that a corporation could track our individual movements so closely? Funny, I thought 1984 was seven years ago. (Business Wire via Yahoo Supermarket News 12/19/01) News item contributed by Ryan Yuhas, CASPIAN volunteer.
Another family-owned supermarket chain is no more. Genuardi's Family Markets, a privately owned no-cards supermarket chain based in Norristown, Pennsylvania that has been serving customers for more than 80 years, entered an agreement to sell their 36 Genuardi's stores and three wholly owned Zagara's stores to Safeway. Safeway, of course, is one of the nation's largest supermarket chains and an aggressive promotor of the Safeway "club card." Safeway will now operate over 1,700 stores in 21 states in the U.S. and Western Canada, with annual sales of approximately $33 billion. The company will employ more than 200,000 people. (Safeway press release via Yahoo Supermarket Industry News 12/5/00)
The Pantry, Inc. is the second largest independently operated convenience store chain in the country. Like most large food retailers, it seems determined to swallow up as many of its competetitors as possible so it can become as bloated, bureaucratic, and unresponsive as the other guys. This month the Pantry swallowed 18 Amoco and Chevron convenience stores in Jackson, Mississippi, then consumed 5 more in North and South Carolina, and finally washed them down with 26 Fast Lane stores in Mississippi and Louisiana. Pantry President and CEO, Peter J. Sodini, explains, "...our expansion strategy remains on track and we have met our current acquisition target of 140 stores for fiscal 2000." Sodini later assures us that the Pantry will continue growing: "We are excited that we are already making solid progress on our growth and expansion plans for fiscal 2001." There are now more than 1,300 Pantry stores in FL, NC, SC, GA, KY, VA, IN, TN, MI, and LA. (The Pantry, Inc. press releases via Yahoo Supermarket News 9/18/00 (linked above) and 9/22/00)
Ever worry that a giant, foreign, and impersonal multinational corporation might someday control your family's food supply? Perhaps it's time to start worrying in earnest. Royal Ahold (the Netherlands-based behemoth) is making no efforts to hide how big it's grown lately. Ahold is targeting 30 million customers in 23 countries (just ponder that for a moment) in what it has called the supermarket industry's first ever "worldwide promotion." The promotion, titled "Best in Your Home," is slated to run over a two-week period ending in October and includes product discounts, cruises, free soda, and, for Guatemala shoppers, even free houses. In the U.S., Ahold's promotion will affect more than 1,100 Stop & Shop, Giant Carlisle, Giant Landover, BI-LO and Tops stores. In Europe, the promotion includes Hypernova hypermarkets, Albert Heijn in The Netherlands, ICA in Sweden/Norway, Albert supermarkets in the Czech Republic, and Ahold-owned stores in Poland and Spain. In South and Central America, participating chains include Disco in Argentina, La Fragua in Honduras, El Salvador, and Guatemala, and Santa Isabel stores in Paraguay, Peru, and Chile. In Asia, the promo will hit TOPS stores in Thailand, Malaysia and Indonesia. (Ahold press release via Yahoo Supermarket News 9/13/00)
Winn-Dixie has announced that it will complete the acquisition of 9 Gooding's Supermarkets in Florida by the end of September. Since Winn-Dixie has never had a surveillance card program and Gooding's does, I asked Mickey Clerc, Winn-Dixie's VP of Public Relations, what impact the acquisition would have on each store's policy. He assured me that Winn-Dixie has no current plants to introduce a card (thus upgrading Winn-Dixie's CASPIAN status to a double-ribbon) because in the company's view, Winn-Dixie shoppers do not want such a program. On the other hand, they have no immediate plans to dismantle Gooding's program in the belief that Gooding's shoppers like things the way they are. If you are a Gooding's shopper (or, better still, boycotting Gooding's because you oppose their card), you can express your views on the subject to Winn-Dixie at this web form. If you are a satisfied Winn-Dixie shopper, you can use the same form to applaud Winn-Dixie for their stand against cards. (Winn-Dixie press release via Yahoo Supermarket News 9/7/00)
Yes, Ahold is at it again. The Ahold subsidiary, Etos, which already owns 420 stores in the Netherlands, is buying 17 Dutch outlets of the British drugstore chain Boots. Boots has annual sales in the Netherlands of around Euro 18 million. Ahold acquired the Etos chain in 1974, and since 1996 has more than doubled the number of Etos stores. By the end of 2001, Etos expects to have up to 500 stores with sales of approximately Euro 450 million. Boots stores will be remodeled into the Etos format by the end of this year. (Ahold Press Release via Yahoo Supermarket News 8/17/00)
Less than a month after announcing the acquisition of GFG Foodservice (see article below dated 7/20/00) Ahold has announced that it will now acquire PYA/Monarch, a major food service distributor in the American southeast currently owned by Sara Lee Corporation. In a deal expected to close by the end of this year, the recently acquired Ahold subsidiary, U.S. Foodservice, will pay $1.57 billion to acquire PYA/Monarch. PYA/Monarch supplies 38,000 food and non-food items to almost 40,000 customers and has annual sales of nearly $3 billion. Customers include national restaurant chains including Ryans, Applebees, and Subway, as well as healthcare institutions, universities and hotels. Bob Tobin, Chairman Ahold USA explains, "We are... anxious to increase our involvement in the American foodservice industry." We noticed, Bob. (Ahold Press Release via Yahoo Supermarket News 8/16/00)
Royal Ahold has announced that it will acquire the North Dakota-based food distributor GFG Foodservice and incorporate it into its recent acquisition, U.S. Foodservice (the second-largest food distributor in the United States, acquired by Ahold in April, 2000). GFG provides food to over 4,300 restaurants, schools, universities and health care institutions in North Dakota, South Dakota and Minnesota. For more on Ahold, the world's 6th largest supermarket company and the 3rd largest owner of supermarkets in the U.S. please review the Supermarket News archive at left. (Ahold press release via Yahoo Supermarket News 7/20/00)
Is anywhere on the globe safe from Royal Ahold's ravenous appetite? You would have thought that maybe Slovakia, a tiny country in Central Europe where less than 10% of food is purchased through supermarkets, would not be flashy enough to capture Ahold's interest. But Ahold has announced that it will soon begin imposing its "hypermarkets, megamarkets and supermarkets" on this tiny corner of the globe, too. (Ahold press release via Yahoo Supermarket News 7/19/00)
Major Supermarkets Positioning for Online Sales
Shopping for groceries online has not caught on as fast as some dotcom investors had hoped. But now that big supermarket chains are getting in on the action, that may change. Instead of worrying about whether online grocery shopping services might someday eat into their market share, the big guys have decided to buy out or partner up with the dotcoms. ("Instead of worrying about 'em, buy 'em!") Examples: Ahold now owns 51% of Peapod [story], Kroger has partnered with Priceline WebHouse Club [story], and Safeway has agreed to invest $30 million in GroceryWorks.com in return for 50% of their stock [story].
Maybe the Federal Trade Commision has merely been in a coma for the last few years. The regulatory agency, charged with preventing monopolies in key industries, registered a faint pulse earlier this month with the news that it intends to block Kroger from buying 74 Winn-Dixie stores in in Texas and Oklahoma. Kroger, the nation's largest supermarket chain and an avid promoter of its privacy-invading shopper card, has been buying up family-owned grocers all over America at an alarming pace. (See the Supermarket news archive for examples.) Kroger has bought out the last privacy-friendly stores in many areas, leaving shoppers with no recourse. FTC, where were you when we needed you? [For full text of FTC complaint click here, Kroger's response here, more on increasing anti-trust activity here.] (Yahoo Supermarket News 6/02/00)
Winn-Dixie, a Florida-based supermarket chain with over 1,200 stores in 14 states, has announced that it will purchase 9 family-owned Gooding's Supermarkets in Central Florida. (Gooding's will retain three other stores.) The good news? Winn-Dixie is a privacy-respecting no-cards store, which means Gooding's shoppers will soon be saying goodbye to the Gooding's "value card" and its creepy "baby club." The bad news? The loss of another family-owned chain to consolidation mania. (Winn-Dixie press release via Yahoo Supermarket News 6/02/00)
Hold onto your hats! Ahold President &
CEO Cees van der Hoeven made the following earth-shatteringly obvious
admission today: "Our company is sometimes described as acquisitive, and
we are certainly that..." Um, yep.
In its second takeover of a U.S. convenience store chain in less than a month, acquisition-hungry Royal Ahold today announced that it will buy 134 Golden Gallon convenience stores in Tennessee. Golden Gallon was founded in 1959 and had sales of $300 million last year. Two-thirds of these stores' income results from gasoline sales; the rest comes from the sale of tobacco, milk and beverages. Ahold will fold the stores into its Bi-Lo division, and yes, Bi-Lo supermarkets register and monitor their patrons. The acquisition is subject to regulatory approval (cough, cough) and is expected to close by the end of May. (Ahold Press Release, via Yahoo Supermarket News 4/19/00)
The EU Commission announced Friday its approval of French group Carrefour's full control over Italian food retailer Gruppo. For more on Carrefour, see the supermarket news archive by clicking the link at left. Please drop me a line if you know more about Gruppo or have information on this merger. (Bridge News via Individual.com 4/7/00)
Pao de Acucar, a Brazillian supermarket chain with 285 stores, is negotiating to buy Reimberg, a chain with nine supermarkets in the South of Sao Paulo. Earlier this year, Pao de Acucar bought nine stores from Mercadinhos Sao Luiz in the Brazilian state of Ceara. (Individual.com 4/4/00)
Royal Ahold (the enormous Dutch company that is gobbling up U.S. supermarkets and food distributors at an astonishing pace) has announced that its wholly owned subsidiary, Topp's Market, is acquiring 87 Sugar Creek convenience and gas stores in New York state. Sugar Creek had sales of $142 million in 1999. By May 2000, most Sugar Creek stores will be renamed Wilson Farms and be transformed into "neighborhood stores" bringing the total number of Wilson Farms markets to 200. For more on Ahold's stranglehold on the American food market, read on. (Yahoo Supermarket News 3/31/00)
The Midwest's Seaway Food Town, Inc. is currently in negotiations to merge with (read: be swallowed up by) Spartan Stores, Inc. Food Town requires a driver's license number, date of birth, and SSN to acquire a "Food Town Plus Card" at its 47 stores in Ohio and Michigan. Spartan is a wholesaler which supplies groceries as well as "sourcing for card/key tag manufacturing [and] support of third party programs such as Catalina Marketing programs" to 450 Midwestern markets. Spartan also owns and operates Ashcraft's Markets, Family Fare, Great Day Foods and Glen's Markets in Ohio, Michigan, and Indiana. This merger between the privacy brain-dead sounds like a marriage made in hell. (Yahoo Supermarket News 3/13/00)
In a deal so massive it defies comprehension,
Royal Ahold, the world's largest food
provider with thousands of supermarkets on 4 continents, is all set to
acquire U.S. Foodservice,
the second largest food distributor in the United States. Netherlands-based
Ahold already owns Stop & Shop, Giant Foods, Wilson Foods, and Tops,
among others, making it the third largest owner of supermarkets in the
U.S. The acquisition of U.S. Foodservice, which has annual sales of $7
billion, has been called an "additional growth vehicle for Ahold in USA."
The deal is expected to close in May, 2000. Can Ahold be stopped before
it takes over the world? (CBS Marketwatch 3/7/00)
There appears to be no place on the globe safe from competition-threatening supermarket mergers. Now Colombia's two largest supermarkets, Carulla and El Vivero, are discussing a plan to merge. Both companies are 25% owned by a foreign investment fund, the Newbridge Andean Partner. (Source: El Espectador, via Bridge News, via Individual.Com 2/1/00)
Dutch Ahold, the world's 6th largest supermarket company with 3,600 stores on 4 continents, has reached an agreement to acquire all outstanding shares in Spain's Kampio supermarkets. The acquisition of all 39 Kampio stores is an "excellent new step in becoming a truly national player in Spain," said an Ahold board member, and a spokesman assures us that Ahold will acquire a "substantial number of stores in new locations over the next few years and this year." Royal Ahold was already Spain's top 4 grocery retailer. And they're the 3rd largest owner of supermarkets in the U.S. (Bridge News via Individual.com 1/24/00)
Nebraska's Hinky Dinky supermarket chain of twelve stores has been acquired by the Nash Finch Company, one of the nation's largest grocery wholesalers and operator of 114 retail supermarkets. "This is another exciting acquisition for Nash Finch Company as we continue...our strategic plan..." said Ron Marshall, Nash Finch president and CEO. To get a sense of what is lost when small town markets get homogenized by the behemoths, take a look at the Hinky Dinky page on the Seward, Nebraska Chamber of Commerce website. Then ponder the fact that Nash Finch has annual revenue of $4.2 billion. Hinky Dinky shoppers: you used to be the most important consideration in that store's business. Now you've become aggregate statistics for corporate paper pushers in another state. (Nash Finch press release on Yahoo News 1/18/00)
Hey, didn't you just read this same news story last week? No, that was the Contos family (see below). This time it's the Kessel family (owners of 20 Kessel markets in Michigan) who is making the "difficult" decision to turn over their life's work to Kroger after several generations of family ownership. Kroger must be writing these guy's speeches since all the patriarchs say the same thing -- how even though it's hard and painful to turn their stores over to Kroger they're forcing themselves to do it for the good of employees and shoppers. As with Pay Less, Kroger will not change the Kessel Market name, so shoppers will remain blissfully unaware that Kroger is spreading like a cancer across the nation. (Kroger press release 12/15/99)
After more than 50 years in the Contos family, Pay Less Super Markets, an 8-store Indiana chain, has been acquired by Kroger for "an undisclosed amount of cash." Since Kroger is not changing the stores' names, shoppers won't notice the ownership switch until Kroger begins pestering them for personal data. Pay Less was founded in 1947 by H.J. "Bud" Contos and has been run by his son, Larry, since 1961. Larry describes his decision to sell as "difficult" and "emotional," but explains that, ``it is evident to me and my family that now is the right time to place our life's work into [Kroger's] hands." Come on, Larry, did you really say that? Yikes! (Kroger press release 12/1/99)
Both Albertson's and Kroger stock values have fallen sharply in recent months due to their Hungry Hippo expansion strategies. Retail analyst Andrew Wolf calls the problem "acquisition indigestion." He reports that the supermarket stock index he tracks is down 38.5% this year. "They're digesting the acquisition and getting the companies in the fold and getting used to each other and executing systems conversions....Just the various risks associated with mergers also cause [investors] to become disinterested in supermarkets." (CBS Marketwatch 12/1/99)
Read about Albertson's "credibility issue" as its stock values plummet in response to the American Stores acquisition. (CBS Marketwatch 11/30/99)
Netherlands-based Ahold, the 3rd largest supermarket company in the U.S. and the 6th largest in the world, has still not received FTC approval to acquire Pathmark, the nation's 19th largest grocery company. The $1.75 billion purchase was announced in March and was expected to be finalized by the end of 1999, but the FTC has slowed it down a bit. Ahold seems to be doing fine anyhow -- it recently reported a 43% increase in its third quarter net profit. (Reuters via individual.com, 11/24/99)
Kroger announced it will purchase 74 Winn-Dixie grocery stores in Texas and Oklahoma to add to the 169 Krogers already it already has there. Readers tell me that some Kroger stores in Texas are not inflicting the Kroger card on shoppers (Texans are notoriously privacy-conscious) so it remains to be seen whether these new acquisitions will remain card-free or not. In any event, Kroger, already the nation's largest grocery monster, appears to be growing by leaps and bounds. (Kroger press release 11/2/99)
Nash Finch has agreed to purchase Fairway Foods of Michigan, Inc., a wholesale division of Fairway Foods, Inc., which is owned by Holiday Companies, Bloomington, Minn. Fairway Foods/Michigan supplies independent retail stores in Michigan's Upper Peninsula and northeastern Wisconsin. Its 1998 revenues exceeded $160 million. (Nash Finch press release via Yahoo 11/1/99)
With the acquisition of 13 competitors' stores, including nine Sun Harvest Farms stores in Texas and four Wild Harvest stores in the Boston area, Wild Oats becomes the new 800-pound gorilla in the natural food market. Wild Oats acquired 37 stores in 1999, bringing it to a total of 105 stores. Roughly two-thirds of these were obtained through mergers or buyouts. If there is any upside to this loss of locally owned competition, it is that Wild Oats is a confirmed no-cards store. (CBS Marketwatch 10/31/99)
Consolidation-hungry supermarket giant, Safeway Inc., has completed a merger with Randall's Food Markets Inc. Safeway was anxious to add Randall's 116 Tom Thumb and Simon David stores (with $2.6 billion in annuals sales) to its existing 1,534 stores and $27 billion sales. (Newspage 9/14/99)
Two of Europe's largest retailers, Promodes and Carrefour, have merged in a $16.5 billion deal. The new company, called Carrefour, will have nearly 9,000 stores in 26 countries in Europe, Latin America, Asia, and the Middle East.
French law prohibits the construction of vast stores which stifle competition. Carrefour, which according to a company spokesman, sees "a clear need for globalization," has gotten around such restrictions by buying up foreign chains and wiping out national competition in deals such as this merger with former competitor, Promodes.
A spokesman for the National Federation of Farmers Unions warned, "Suddenly there is one group with the power to buy approximately one third of France's food production. If a producer can't sell to that group, it could mark the end of his business." As consumers, we cannot rely on independent farmers to provide alternative food sources if the multinational giants get out of line, since the farmers, too, will be at their mercy. (Newsweek 8/99)
In 1998 Carrefour and Promodes had combined revenues of $52.9 billion, second only to Wal-Mart's $123.2 billion. The merger adds Carrefour/Promodes to "a select group of European retailers positioned for truly global operations, such as Netherlands-based Royal Ahold and [Germany's] Metro." (Retail Systems 8/99)
Food Lion Supermarket Chain (which has a club card program) has acquired Hannaford (which did not) to become the nation's 6th largest supermarket retailer. The article notes that the "acquisition comes at a time when the pressure for consolidation in the supermarket industry is increasing....This year, the three biggest grocery chains have all made acquisitions. Industry leader Kroger bought Fred Meyer; Albertson's merged with American Stores; and Safeway added Randall's Food Markets Inc." (Charlotte Observer 8/99)
"With the recent announcement of SUPERVALU's purchase of Richfood, we lost another venerable institution with a great history."
Industry consultant Frank Dell observes that the wholesale grocery industry has shrunk from 300+ companies to just 62 in recent years and predicts that within three years only 22 wholesale suppliers will remain. Given the article's title, "And Then There was One," the implications are obvious. (Idea Beat 6/99)
"Our prediction is that [eventually] there will be five to seven super regional chains... Ahold, Safeway, Kroger and Albertson's all would be classified as super regional chains."
Frank Dell discusses the merger and consolidation trend. (Idea Beat 8/98)
Catalina Marketing Grows Again (go to 3rd article)
400 more stores enlist Catalina's services to invade customers' privacy (Progressive Grocer 5/98)