Reuters reports on the continuing travails faced by the Great Atlantic & Pacific Tea Company (A&P), noting that the company that once had 16,000 stores but now is down to fewer than 400 needs to further trim its operations and “sell assets to pay down debt and survive tough competition.”
Analysts quoted in the story seem to feel that bankruptcy may be inevitable, that the company’s recent store-closing and cost-reduction efforts simply aren’t enough to allow the company to be competitive.
Analysts quoted in the story seem to feel that bankruptcy may be inevitable, that the company’s recent store-closing and cost-reduction efforts simply aren’t enough to allow the company to be competitive.
- KC's View:
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Furthermore, beyond the numbers issues, there is the additional problem that A&P is a company without a differential advantage, a company that seems to lurch from tactical move to tactical move without a broader strategy and vision for the kind of company it needs to be in the future.
Here’s the problem. A&P is a 20th century company, competing largely with 21st century retailers. It isn’t too early to start thinking about how it is going to be a 22nd century retailer, and start moving in that direction. I’m all in favor of taking baby steps towards viability and even profitability, but they also have to start thinking about the quantum leap that will give them a sustainable advantage long-term, allowing them to surprise & delight (S&D) the shopper.
