Jump to content

Kroger/Albertson's


YGIFS
 Share

Recommended Posts

Big acquisition underway between Kroger and Albertson's.  Gonna take some time to get fed approval.  But this'll put the new enterprise at about 1,800 stores nationwide.  I'm guessing the idea is a full-on assault of Wal-Mart and Amazon.  ALDI Foods will still have more stores (2,300 nationwide, largest in the world), but their model is much more discount, smaller stores, and very little digital/delivery presence.  

Really curious to see what the new online platform looks like for Krogertson's.  This is also going to significantly alter wholesale food contracts, supply chain, and mostly shipping logistics.  I don't know that I've ever walked into or out of a Kroger's or Albertson's and thought to myself, "what a nice store, what a nice shopping experience."  But if you're if you live in an exurb or larger rural area...you're sure as shit glad they're nearby.  

The real loser in all of this is Safeway.  Which is doing everything it can to become a relic.  

Anyway, lots of financial consequences of this, but the real estate footprint, store numbers, and logistics are what we're watching.  Thoughts, particularly from those of you like me adjacent to the grocery industry?  

  • Hook 'Em 1
Link to comment
Share on other sites

1 minute ago, YGIFS said:

But this'll put the new enterprise at about 1,800 stores nationwide. 

Kroger already has 2800 locations

 

2 minutes ago, YGIFS said:

The real loser in all of this is Safeway

Safeway is part of Albertsons.  Has been for nearly a decade.

  • Hook 'Em 3
  • Haha 1
Link to comment
Share on other sites

2 minutes ago, Incredulity said:

Kroger already has 2800 locations

 

Safeway is part of Albertsons.  Has been for nearly a decade.

Yeah that was a real WTF post. Two shit brands merging. It won’t effect Tom Thumb or HEB / Central Market, and has no impact on me. 

Link to comment
Share on other sites

Ah shit, I misread that store count report.  It was pre-mergers.  Only thing I have up to dates on is Aldi, mostly because I don't keep up with shitty grocery stores.  Anyway, story remains---the Krogertson's thing is happening.  

Link to comment
Share on other sites

19 minutes ago, Porterhouse said:

Yeah that was a real WTF post. Two shit brands merging. It won’t effect Tom Thumb or HEB / Central Market, and has no impact on me. 

I just caught a cursory look at the whole article and then pulled up a store count in some ancient spreadsheet I had.  But if Safeway and Albertson's are together and Tom Thumb is part of Safeway, won't an Albertson's acquisition by Kroger effect Tom Thumb?  Again, I probably have this wrong.  

But yeah, the assault on DFW by HEB/Central Market that has now begun phase two...this could be nothing for Texas...but I suspect will have larger implications for the western half of the nation.  

Link to comment
Share on other sites

8 minutes ago, YGIFS said:

I just caught a cursory look at the whole article and then pulled up a store count in some ancient spreadsheet I had.  But if Safeway and Albertson's are together and Tom Thumb is part of Safeway, won't an Albertson's acquisition by Kroger effect Tom Thumb?  Again, I probably have this wrong.  

But yeah, the assault on DFW by HEB/Central Market that has now begun phase two...this could be nothing for Texas...but I suspect will have larger implications for the western half of the nation.  

The fact is my wife goes to Central Market for food exclusively. For other items, a Tom Thumb down the street. As long as this doesn’t affect TT quality, this will have zero impact on major metro areas of Texas. 

Link to comment
Share on other sites

I don't think this deal makes it through the Feds without some fairly significant divestiture requirements.

But that can change too.

Full disclosure: I didn't think the Albertson/Safeway merger would be allowed happen.  So who the fuck knows.

 

 

Link to comment
Share on other sites

With Tom Thumb, Albertson's, Market Street, and Kroger together, it should have a big impact on the DFW market.  DMN covers it here.  Looks like the merger would capture just over 28% of the DFW market, making it #1 ahead of Walmart.

From the DMN article:

1774680889_DFWGroceryData.thumb.jpg.34e079ec6b157c9dc7a14ccc48bbc7ae.jpg

My neighborhood stores are Tom Thumb and Albertson's about a mile apart from each other.  Albertson's is shit, and Tom Thumb is just a more expensive Albertson's.  I expect one of those to close as a result of the merger.  HEB owns a large undeveloped tract a mile or two down the road from them, but no public plans yet for that property.  HEB can't get here fast enough.

Link to comment
Share on other sites

3 hours ago, YGIFS said:

I just caught a cursory look at the whole article and then pulled up a store count in some ancient spreadsheet I had.  But if Safeway and Albertson's are together and Tom Thumb is part of Safeway, won't an Albertson's acquisition by Kroger effect Tom Thumb?  Again, I probably have this wrong.  

But yeah, the assault on DFW by HEB/Central Market that has now begun phase two...this could be nothing for Texas...but I suspect will have larger implications for the western half of the nation.  

Did you have discontinued brands of kettle chips and other items of frustration in that spreadsheet? 

  • Hook 'Em 1
  • Haha 5
Link to comment
Share on other sites

Items of Frustration is a good name for the last aisle at my Trader Joe's.  It's all this expensive, impulse buy snacking shit my kids always want.  At least you can skip the candy aisle in the middle of HEB easily.  There's no escaping the items of frustration aisle at Trader Joe's unless you're trying to sneak it out the front door without paying.

But yes, my antiquated data sets and wildly fascinating stories about how we all shop in Texas for groceries aside...was more curious what y'all think this means to the underlying stock/capitalizations but most importantly what this means for grocery shopping for a huge segment of the United States outside of Texas?  I mean this is bigger, dollar and customer-wise than Amazon/WF.  This is ALDI/Trader Joe's level, bigger even.  for most of America west of the river...outside of larger cities and outside of half of Texas...you either have a Kroger, an Albertson's, or a Safeway brand...and that's it...and even then...it could be 30 minutes away.  

 

Link to comment
Share on other sites

0001111000464

If this comes to United in West Texas( owned by Albertsons,) regardless of anything else, I'd consider the transition a success.  When we lived in H-town metro, Kroger was the first to build by our subdivision and I shopped there for probably 80% of our groceries.  When they built a subsequent HEB(90%) and WalMart(10%,) I very rarely went to Kroger unless they had some hot pricing on beer or ice cream or some shit like that.  It's hard to see how this aquisition makes them more competitive in markets like Houston or Dallas.  It's not going help them fight HEB, IMHO.  In other markets, maybe it will.

 

  • Hook 'Em 1
Link to comment
Share on other sites

Lots of Tom Thumbs in my hood and yes they are owned by Albertsons, it's clear from the app.

It used to be TT, Safeway, and Kroger in the vicinity, then Safeway went away and then bought TT and came back in a roundabout way.  TTs brought back Safeway's locally sourced Lucerne dairy stuff, including ice cream, which was always a solid brand.

The TTs improved when they acquired Simon David specialty grocer and made the TTs in nice hoods rather Simon David-y.  Simon David was a Central Market looong before there was a Central Market, or Whole Foods, or Eatzi.

As far as I can see, there's not a ton of difference among the various stores, as long as they're in a nice hood.

  • Like 1
Link to comment
Share on other sites

There are going to have to be a ton of store sales in the Dallas and Houston markets due to anti-trust issues. The Randall's and Tom Thumb stores bump up right next to Kroger's everywhere in both markets.  Could be a great opportunity for HEB to pick up some locations (when they are open).

Link to comment
Share on other sites

1 hour ago, DalTxHornFan said:

There are going to have to be a ton of store sales in the Dallas and Houston markets due to anti-trust issues. The Randall's and Tom Thumb stores bump up right next to Kroger's everywhere in both markets.  Could be a great opportunity for HEB to pick up some locations (when they are open).

That’s not how H‑E‑B operates.  They are going to do their best to make Kroger/Albertsons eat that money on the store.  They aren’t there to help them out.  

  • Hook 'Em 2
  • Like 2
Link to comment
Share on other sites

19 hours ago, YGIFS said:

I just caught a cursory look at the whole article and then pulled up a store count in some ancient spreadsheet I had.  But if Safeway and Albertson's are together and Tom Thumb is part of Safeway, won't an Albertson's acquisition by Kroger effect Tom Thumb?  Again, I probably have this wrong.  

But yeah, the assault on DFW by HEB/Central Market that has now begun phase two...this could be nothing for Texas...but I suspect will have larger implications for the western half of the nation.  

Assault? They’re barely touching the very northern tips where Market Street was the big dog. That’s not to say they won’t expand (and I’d gladly welcome that) but there’s a reason they didn’t start in the downtown area…or inside the 635/20 loop…or south of the GBT…or even south of 121.

Edited by hpslugga
Link to comment
Share on other sites

Yeah, the HEB expansion into the Metroplex has been curious.  But it'll work in the end.  Y'all up there know more about it than I do.  My intention on the thread was as stated in the OP, how does this effect shoppers in the new age of grocery buying in the Western Half of the U.S?  But yes, I realize most of us shop at HEB and Central Market.  Big shock.  

Link to comment
Share on other sites

19 hours ago, Trey3216 said:

That’s not how H‑E‑B operates.  They are going to do their best to make Kroger/Albertsons eat that money on the store.  They aren’t there to help them out.  

Yep, at best they’ll let Krogers take a beating on the real estate transaction and then buy it second hand a few years down the road.

If I was betting on it, I’d guess your see a good chuck of them get converted to Walmart neighborhood grocery stores.

  • Like 1
Link to comment
Share on other sites

15 hours ago, hpslugga said:

Assault? They’re barely touching the very northern tips where Market Street was the big dog. That’s not to say they won’t expand (and I’d gladly welcome that) but there’s a reason they didn’t start in the downtown area…or inside the 635/20 loop…or south of the GBT…or even south of 121.

They own lots of property in DFW.  They’ve played the long game throughout Texas on both Albertsons and Kroger.  They wait til those stores have to do major capital injection upgrades to their stores and then pounce on store building sprees.  It makes the competitor have to commit to stay in market for a measured period since they just wasted $$ upgrading, then they lose their shoppers to H‑E‑B.  
 

H‑E‑B is absolutely the dexter of grocery economics.  Just a calculated killer. 

  • Hook 'Em 1
  • Like 1
Link to comment
Share on other sites

That’s not how H‑E‑B operates.  They are going to do their best to make Kroger/Albertsons eat that money on the store.  They aren’t there to help them out.  

They did buy an old Randall’s off of 183/Spicewood in Austin but it’s one of their smaller stores. That’s the only instance I’m aware of.
Link to comment
Share on other sites

45 minutes ago, Stunns38 said:


They did buy an old Randall’s off of 183/Spicewood in Austin but it’s one of their smaller stores. That’s the only instance I’m aware of.

Yep, I think it used to be an Albertsons.  That store has killed it forever.  I know that type of thing is not their pro-forma business plan.  But now that they have the DFW/HOU distribution centers in place, I cannot imagine that they are not going to be opportunistic in this situation.

Edited by DalTxHornFan
Link to comment
Share on other sites

Antitrust laws have been so neglected I doubt there is a problem. They will probably spin off the low performing stores into a brand that will fail to give the appearance of competition. Walmart will continue to dominate regardless of the merger. 

2E5420FD-29D8-496B-A8BC-269BB03CD598.thumb.png.d1fef668ac70737da40d7edee836205d.png

Link to comment
Share on other sites

22 minutes ago, billfromlaketravis said:

Not a fan of the move. Randalls has excellent  good meat priced well. Pretty solid fried chicken from the deli.  I fully acknowledge the rest of the store is overpriced crap. 

Randalls produce is always garbage. Meat is very good. All overpriced 

Link to comment
Share on other sites

9 minutes ago, Celery Man said:

HEB >>>>Wegmans >>>Publix>Harris Teeter>>Food Lion>Lowes

Publix is actually pretty damn good. Harris Teeter reminds me of Randall’s. Never been to Wegmans. HEB is definitely the best (depending on location)

  • Hook 'Em 1
Link to comment
Share on other sites

Had no idea there were that many Aldis in the US. I didn't mind stopping in from time to time when I lived closer.  Not HEB obviously but I like some of their offerings and I wish the prototype of a smaller neighborhood grocery store was more prevalent in Central Texas

Link to comment
Share on other sites

58 minutes ago, Post Oak said:

Had no idea there were that many Aldis in the US. I didn't mind stopping in from time to time when I lived closer.  Not HEB obviously but I like some of their offerings and I wish the prototype of a smaller neighborhood grocery store was more prevalent in Central Texas

I’m just not a fan of Aldi. I understand the appeal. It is small with limited options. It’s great if you just need a few items and don’t want to shop at a convenience store but its bare bones. 

Link to comment
Share on other sites

13 hours ago, Stunns38 said:


They did buy an old Randall’s off of 183/Spicewood in Austin but it’s one of their smaller stores. That’s the only instance I’m aware of.

That was about market dominance.

HEB had stores at Anderson Mill/620, Lakeline/183, Parmer/McNeil, and Braker/183 and they were still losing a larger chuck of the NW Austin market to that little Randalls simply due to location, location, location. Since that is an environmentally sensitive area and the easy access land around that area was already developed they didn’t really have any other options.

Similarly I’d bet money they’d buy out the Randall’s at Spicewood/Mesa for similar reasons.

In DFW they are still in a very early process of entering that market. If they were a publicly traded company then I could see them trying to rush to gain market share to appease the markets, but knowing how they take a very long term strategy on their developments I agree with Trey that’s they’ll sit this one out and hope their entry into DFW and lack of interest in these properties will drive down the sales price and limit Kroger’s capital while they ease their way into the Metroplex.

Link to comment
Share on other sites

On 10/14/2022 at 12:48 PM, Celery Man said:

harris teeter fucking sucks

Is that the rough looking chick ranch hand from Yellowstone?

Just came in to laugh at anybody who doesn't have three H-E-Bs within six miles of their house.  Fire away.

Link to comment
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

 Share

×
×
  • Create New...