U.S. CitiesCity-Data Forum Index
Go Back   City-Data Forum > General Forums > Politics and Other Controversies
 [Register]
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
View detailed profile (Advanced) or search
site with Google Custom Search

Search Forums  (Advanced)
Reply Start New Thread
 
Old 09-11-2015, 07:45 AM
 
Location: Old Bellevue, WA
18,794 posts, read 14,266,872 times
Reputation: 7950

Advertisements

Haggen bankruptcy: Failure is the 'fastest' in modern grocery store history - The Orange County Register

About a year ago, the large West coast grocery store chain Safeway was sold to a private equity company called Cerberus. All well and good, we had a willing seller and willing buyer. Safeway stockholders at the time overwhelmingly approved the deal:
Safeway Gains Shareholder Approval For Cerberus Deal | Food World | Food Trade News

But the federal gov't felt the need to horn in, and insisted that approx. 150 of the stores involved be sold off to a company called Haggen, in order to ensure that no hint of monopoly power would be created. The result was a mess.

Quote:
“This is the fastest (failure) in modern supermarket history,” said grocery strategist Burt P. Flickinger. “In all of retail, I haven’t seen anything like this.”
A friend of mine told me about his neighbor who had worked at a Safeway store for 30 years. The store was converted to 'Haggen' per fed request. It had been one of the biggest and highest volume stores on the West Coast, but after conversion, sales dropped by 60%. She wanted to transfer to another Safeway store, but was not allowed that option. She's up the creek w/o a paddle, while the federal regulators who created this mess go tra-la-la on their way with zero accountability.

The very idea of monopoly in the grocery industry is just dumb in the era of Walmart, Costco, Amazon, etc.
Reply With Quote Quick reply to this message

 
Old 09-11-2015, 02:24 PM
 
20,611 posts, read 13,001,195 times
Reputation: 5905
Quote:
Originally Posted by wutitiz View Post
Haggen bankruptcy: Failure is the 'fastest' in modern grocery store history - The Orange County Register

About a year ago, the large West coast grocery store chain Safeway was sold to a private equity company called Cerberus. All well and good, we had a willing seller and willing buyer. Safeway stockholders at the time overwhelmingly approved the deal:
Safeway Gains Shareholder Approval For Cerberus Deal | Food World | Food Trade News

But the federal gov't felt the need to horn in, and insisted that approx. 150 of the stores involved be sold off to a company called Haggen, in order to ensure that no hint of monopoly power would be created. The result was a mess.



A friend of mine told me about his neighbor who had worked at a Safeway store for 30 years. The store was converted to 'Haggen' per fed request. It had been one of the biggest and highest volume stores on the West Coast, but after conversion, sales dropped by 60%. She wanted to transfer to another Safeway store, but was not allowed that option. She's up the creek w/o a paddle, while the federal regulators who created this mess go tra-la-la on their way with zero accountability.

The very idea of monopoly in the grocery industry is just dumb in the era of Walmart, Costco, Amazon, etc.
God. Heaven help us all here.
Reply With Quote Quick reply to this message
 
Old 09-11-2015, 02:30 PM
 
Location: Southern California
15,087 posts, read 17,558,796 times
Reputation: 10299
Competition breeds excellence and Haagen couldn't compete.

[the end]
Reply With Quote Quick reply to this message
 
Old 09-11-2015, 02:46 PM
 
Location: Stasis
15,837 posts, read 10,033,649 times
Reputation: 8547
Quote:
Originally Posted by wutitiz View Post
But the federal gov't felt the need to horn in, and insisted that approx. 150 of the stores involved be sold off to a company called Haggen, in order to ensure that no hint of monopoly power would be created. The result was a mess..
In most of these cases the merger would have resulted in 2 Albertsons or Vons across the road from each other. Haggen didn't have to take the stores but made a capitalistic decision that they could quickly grow their 18 store operation in another region to 180+ stores in a new market -and do well despite being more upscale than the old locations and more upscale than the surrounding Albertsons & Vons. They made a bad capitalistic corporate decision - not the gov'ts fault.
Reply With Quote Quick reply to this message
 
Old 09-11-2015, 02:49 PM
 
Location: Stasis
15,837 posts, read 10,033,649 times
Reputation: 8547
Quote:
The very idea of monopoly in the grocery industry is just dumb in the era of Walmart, Costco, Amazon, etc.
Amazon grocery sales are negligible.
Nationally Walmart has 25% of grocery sales. In my city that's likely closer to 70%.
Reply With Quote Quick reply to this message
 
Old 09-11-2015, 03:04 PM
 
Location: Old Bellevue, WA
18,794 posts, read 14,266,872 times
Reputation: 7950
Quote:
Originally Posted by katzpaw View Post
In most of these cases the merger would have resulted in 2 Albertsons or Vons across the road from each other. Haggen didn't have to take the stores but made a capitalistic decision that they could quickly grow their 18 store operation in another region to 180+ stores in a new market -and do well despite being more upscale than the old locations and more upscale than the surrounding Albertsons & Vons. They made a bad capitalistic corporate decision - not the gov'ts fault.
There were clearly two parties in this decision. One was Haggen, as you point out. But the other was the federal gov't, which forced the sale upon Cerberus. Clearly without the intervention of the feds, the deal would have not happened the way it did.

But thanks for proving my point: the federal regulators that helped to create this mess will walk away from it with ZERO accountability.
Reply With Quote Quick reply to this message
 
Old 09-11-2015, 03:06 PM
 
45,061 posts, read 17,902,619 times
Reputation: 18888
Quote:
Originally Posted by wutitiz View Post
About a year ago, the large West coast grocery store chain Safeway was sold to a private equity company called Cerberus.
I believe these were the same financial vampires who sucked all the blood from Chrysler, got rich, then dumped the carcass onto the taxpayers which Obama promptly bailed out.

Gotta protect the financial vampires at all costs.
Reply With Quote Quick reply to this message
 
Old 09-11-2015, 03:11 PM
 
32,440 posts, read 16,612,446 times
Reputation: 17452
Quote:
Originally Posted by wutitiz View Post
But the federal gov't felt the need to horn in, and insisted that approx. 150 of the stores involved be sold off to a company called Haggen, in order to ensure that no hint of monopoly power would be created.
The FTC did not insist on Haggen. The sell-off was triggered by anti-trust law, but any interested buyer could have stepped up.

You can blame Haggen for trying to jump from 18 to 170+ stores in a matter of months. And there is a lot of evidence that Albertson's failed to live up to their contractual obligations during the transfer - the courts will sort that out, they're suing each other.
Reply With Quote Quick reply to this message
 
Old 09-11-2015, 03:14 PM
 
Location: Old Bellevue, WA
18,794 posts, read 14,266,872 times
Reputation: 7950
Quote:
Originally Posted by katzpaw View Post
Amazon grocery sales are negligible.
Nationally Walmart has 25% of grocery sales. In my city that's likely closer to 70%.
I don't know what Amazon's share is, but apparently it is enough that Google is now throwing its hat into the food sales ring:

Google will now deliver fresh food, competing with Amazon - Telegraph

The point is that there is no grocery monopoly possible unless perhaps gov't decided to impose one. There was no need for DC bureaucrats to horn into this deal. We would all have been better off if this agency never existed, and the money to pay their salaries was back in our pockets.
Reply With Quote Quick reply to this message
 
Old 09-11-2015, 03:47 PM
 
Location: Old Bellevue, WA
18,794 posts, read 14,266,872 times
Reputation: 7950
Quote:
Originally Posted by Dane_in_LA View Post
The FTC did not insist on Haggen. The sell-off was triggered by anti-trust law, but any interested buyer could have stepped up.

You can blame Haggen for trying to jump from 18 to 170+ stores in a matter of months. And there is a lot of evidence that Albertson's failed to live up to their contractual obligations during the transfer - the courts will sort that out, they're suing each other.
True the FTC did not force Haggen into the deal. However they did force Safeway/Albertsons/Cerberus. That is the point, which one after another left-leaner seems to miss.
Reply With Quote Quick reply to this message
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.

Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.


Reply
Please update this thread with any new information or opinions. This open thread is still read by thousands of people, so we encourage all additional points of view.

Quick Reply
Message:

Over $104,000 in prizes was already given out to active posters on our forum and additional giveaways are planned!

Go Back   City-Data Forum > General Forums > Politics and Other Controversies
Similar Threads
Follow City-Data.com founder on our Forum or

All times are GMT -6.

© 2005-2019, Advameg, Inc. · Please obey Forum Rules · Terms of Use and Privacy Policy · Bug Bounty

City-Data.com - Archive 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31, 32, 33, 34, 35 - Top