The East Bay Business Times reports that having decided that $9.4 billion wasn’t enough to sell the company, Albertsons’ management “may find it difficult to rekindle its relationship with investors and the buying public.”
The problem is that even though Albertsons says it has recommitted itself to its business, its customers and its employees, it continues to be interested in selling off pieces of the company. And, according to analysts, even a sale of pieces of the company won’t solve Albertsons’ structural problems, fueled by a growth strategy that was keyed to 1) cost cutting and 2) acquisitions of regional chains such as Shaw’s.
"You can't grow just by cutting costs and making acquisitions," Ted Taft of the retail consulting firm Meridian Consulting Group tells the Business Times. "Trimming costs might help a bit. And some of the divisions are actually outperforming the company as a whole. But what is the company's overall growth strategy? There doesn't appear to be one. (Albertson's) has become kind of a plain vanilla retailer."
The problem is that even though Albertsons says it has recommitted itself to its business, its customers and its employees, it continues to be interested in selling off pieces of the company. And, according to analysts, even a sale of pieces of the company won’t solve Albertsons’ structural problems, fueled by a growth strategy that was keyed to 1) cost cutting and 2) acquisitions of regional chains such as Shaw’s.
"You can't grow just by cutting costs and making acquisitions," Ted Taft of the retail consulting firm Meridian Consulting Group tells the Business Times. "Trimming costs might help a bit. And some of the divisions are actually outperforming the company as a whole. But what is the company's overall growth strategy? There doesn't appear to be one. (Albertson's) has become kind of a plain vanilla retailer."
- KC's View:
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“Plain vanilla,” it seems to us, is the worst kind of criticism to be trained on a retailer.
There’s no room for plain vanilla in 2006 retailing. None.
