A couple of factors make it very unlikely that Farmer Jack can succeed – 1) If the last potential buyer walked away due to the conditions and likelihood that a turnaround would be impossible, then it’s likely impossible. 2) Kroger’s investment in that sector of Michigan has been strong and remains strong. 3) Meijer remains a dominant force in the market area and shows no signs that it will relent. 4) Independents stand strong in competition against Farmer Jack as equally as the other competitors making it even more difficult to re-create a niche in an already intensely competitive market area. 5) Wal-Mart is successfully entering the Greater Detroit area as well. Enough said. 6) If that isn’t enough, Costco also has several very well located stores in the market taking even more of the food dollar. Okay, that was more than a few factors. The Greater Detroit market was and remains a place that is not for the feeble. Farmer Jack unfortunately showed weakness and has likely lost. Another reinvention from those that have… Read more »

As the various articles indicate, it is the perfect time to introduce a low-price retail image, especially in an area where the major income producing industry is suffering a downturn. But we have all probably learned that when price is your attraction, the fickle consumer can quickly migrate to another store when the offer there is better. This creates a real quandary for a retailer who chooses price as their attractor. Once they start down that road they must be prepared to remain there. They must figure out ways to minimize their operating costs and encourage customers to make purchases in the less price sensitive categories so the operation remains profitable. Farmer Jack is no longer self distributing. They must have the cooperation of C&S to ensure deliveries arrive in the most store efficient format. When the choice must be made between warehouse and transportation efficiencies and store operating costs, they need to lean toward reducing store operating costs. This will allow them to maintain the lower prices. The Unions seem to have already been… Read more »

What else to you do when you can’t sell your chain… or even give it away? I really don’t think Farmer Jack is in this for the long run. Improving sales is not an option since Farmer Jack is totally outclassed by Kroger and Meijer. Plus, Wal-Mart Supercenters keep closing in on Detroit. Low prices and A&P are mutually exclusive and cannot be combined. They tried this with Food Basics a couple of years ago only to see sales head south. Since Farmer Jack will probably not be able to improve on the sales side, perhaps they can make gains on the expense side along with improving their real estate values. I predict they will outsource the warehouse distribution like they did in New Orleans while giving the real estate a fresh coat of paint.

Farmer Jack hasn’t got much credibility with its intended audience. They know the company is troubled. They see the results of the instability. The company needs to be turned over to an empowered management team with an undisputed track record turning around troubled grocers. This is one of the toughest challenges in a very tough industry in a very troubled market. Without the Colin Powells and Allen Questroms of supermarkets they aren’t likely to achieve their objectives.

Is Farmer Jack headed in the right direction? What else can they do when all else is apparently failing? If Farmer Jack’s objective is survival, then getting wage concessions and reducing prices in the “price hungry” Detroit market are necessary albeit prosaic tactics. If they push their prices down low enough many shoppers will return. But they will be coming because of the “price” not any magic on the Brand, Farmer Jack, which has become too tired, lame and limp to win a competitive race otherwise in today’s marketplace.

If Farmer Jack wants to thrive and grow, it should re-invent itself completely with a new concept, new format, new stores, new name and shake the chains that are binding it.

Nostalgia is good and bringing back, “It’s Always Savings Time at Farmer Jack” is one way to make the consumer feel good.

Parent A&P has weeded out underperforming stores and has a wage advantage that Kroger doesn’t.

Farmer Jack’s price promotions are a good starting point. In their corner, they carry probably the most respected “house” brand in America, America’s Choice. Along with great deals on Strohs Ice Cream and locally bottled Faygo soft drinks, and with the cheapest milk prices in town, Farmer Jack can take this cash to the bank, reinvest in stores, perhaps bring gas pumps to their parking lots, and win the hearts and wallets of Southeast Michigan shoppers. I feel that this strategy will turn out to be a win-win situation both for A&P and for the Farmer Jack family of loyal customers.