The East Bay Business Times reports that one of Safeway’s new year’s resolutions for 2006 is to avoid becoming Albertsons.
The Business Times notes that in the months since the strike/lockout that affected Southern California in 2002-2003, these two companies have been on dramatically different trajectories. Safeway seems to have calmed its labor woes, focused on rebuilding its brand through Lifestyle stores, and has achieved profitability.
At Albertsons, on the other hand, the company has been struggling to maintain equilibrium, looked to sell off the company, and now has pulled back from that strategy because it could get the price and/or terms it wanted.
“As a traditional supermarket with a unionized work force competing with non-union chains such as Wal-Mart, Safeway is staking out a more affluent, discerning customer base,” The Business Times writes. “Many industry observers contend Safeway's ability to differentiate itself from competitors and appeal to more upscale but convenience-oriented shoppers will be the key to avoid becoming yet another casualty of rapid change in the retail food industry.”
The Business Times notes that in the months since the strike/lockout that affected Southern California in 2002-2003, these two companies have been on dramatically different trajectories. Safeway seems to have calmed its labor woes, focused on rebuilding its brand through Lifestyle stores, and has achieved profitability.
At Albertsons, on the other hand, the company has been struggling to maintain equilibrium, looked to sell off the company, and now has pulled back from that strategy because it could get the price and/or terms it wanted.
“As a traditional supermarket with a unionized work force competing with non-union chains such as Wal-Mart, Safeway is staking out a more affluent, discerning customer base,” The Business Times writes. “Many industry observers contend Safeway's ability to differentiate itself from competitors and appeal to more upscale but convenience-oriented shoppers will be the key to avoid becoming yet another casualty of rapid change in the retail food industry.”
- KC's View:
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In other words, it is a work in progress. Safeway cannot afford to be complacent, but must continue to work to create for itself a differential advantage.
In fact, many of them.
