Closings Pave the Way for Safeway
By George Anderson
That faint giggling you may be hearing is probably coming from Safeway Inc.’s headquarters in Pleasanton, CA.
The supermarket chain has reasons to be giddy. In the past year, it has reinvigorated its business with the rollout of its Lifestyle format and now it finds itself with an unexpected opportunity to grow sales and market share as a result of Albertsons LLC’s decision to shutter 100 stores in five states.
Robert Summers, an analyst with Bear Stearns & Co. wrote in a note to investors: “The biggest potential sales benefit from the store closures is Safeway, who holds the leading share positions in the Northern California markets where most store closures are slated, although it should also benefit from closures in Colorado and, to a lesser degree, Texas.”
Moderator’s Comment: Do you agree that Safeway has
the potential to reap the greatest benefit from Albertsons’ store closings?
What company or companies represent the greatest obstacle(s) to Safeway taking
advantage of this opportunity and what will it need to do if it wishes to capitalize
on the void left by Albertsons’ closings? –
George Anderson – Moderator