CEO Confident Winn-Dixie Making Right Move
By George Anderson
It’s not easy to find positives coming out of an announcement that a company is closing 326 stores, three distribution centers and cutting 22,000 jobs (500 at its headquarters), but Winn-Dixie president and CEO Peter Lynch has to do that very thing if the grocer is going to make its way out of Chapter 11 and be successful.
Speaking at a press conference, Mr. Lynch said the company had “made a very detailed announcement, and I am confident we are making the right decision.”
It wasn’t, admittedly, as if he had many other options when it came to closing stores. “We’ve done a deep dive in every store,” he said.
In a released statement from the company, Mr. Lynch was quoted as saying, “Creating a smaller, but more profitable store base will best position Winn-Dixie for long-term financial health and a successful future. We will be focusing our resources on markets where Winn-Dixie has a strong presence and there are compelling opportunities. This will allow us to build on our strengths and take advantage of the considerable potential we see to improve the shopping experience for our customers. Already, we have made significant strides. The steps announced today will help us to continue our progress as we strive to make Winn-Dixie a stronger company, better able to compete in the marketplace with a strong foundation for the future.”
As to be expected, some feel as though Winn-Dixie has made the right decision while others question if the company has gone far enough or if any changes it makes will be sufficient to help it compete against the likes of Wal-Mart and Publix.
Mark Hamstra of Supermarket News isn’t ready to say Winn-Dixie is on its way back but sees positives in yesterday’s announcement. “It looks like they are getting rid of their weakest performing stores. That should help reduce their overhead and bring them closer to profitability,” he said.
Count Burt P. Flickinger III, managing director of Strategic Resources Group, as among those who think Winn-Dixie did not go far enough.
“They really need to close over 500 stores,” he told The Associated Press. “Sadly, they cut too far at corporate headquarters and haven’t sufficiently cut the number of stores.”
“Their sales, merchandising and operations plan has gone from bad to worse. It’s going to kill the company between this Christmas and next Christmas,” Mr. Flickinger added.
Moderator’s Comment: What is your reaction to Winn-Dixie’s announcement?
Winn-Dixie said it was leaving the following marketing areas entirely:
Alexandria, Louisiana; Atlanta, Georgia; Augusta, Georgia; Charleston, South Carolina; Charlotte, North Carolina; Chattanooga, Tennessee; Columbia, South
Carolina; Columbus-Tupelo, Mississippi; Greensboro-High Point, North Carolina; Greenville-Spartanburg, South Carolina; Huntsville, Alabama; Jackson, Mississippi; Raleigh-Durham,
North Carolina; and Savannah, Georgia. –
George Anderson – Moderator
- Bankrupt Winn-Dixie to Cut 22,000 Jobs – The Associated Press/Forbes.com
- Winn-Dixie Takes Action to Strengthen Performance and Position Company for Long-Term
Profitability – Winn-Dixie Stores, Inc.