The traditional supermarkets such as Albertsons can no longer be able to compete with Wal-Mart Stores and Target Stores. Wal-Mart and Target also have been expanding very fast and adding grocery business in their local stores. Wal-Mart and Target have been selling food and many other household items at discount prices. Some popular items are almost 15% cheaper than at most of the old timers’ supermarkets. Both Wal-Mart and Target are trying to attract customers by offering discount prices with very low profit margins.
Albertsons' parent company Supervalu announced today that they are now closing about 60 underperforming or non-strategic stores in California and other states including Oregon, Washington, Pennsylvania, New Jersey, Maryland, Indiana, Alabama, Georgia, Illinois and Missouri. Many are located in Southern California, including Long Beach, Glendale, Northridge and Van Nuys. Most of stores will be closed by December 1, 2012. After the closing, according to the company press release, they expect to save about $35 million in cash for the next 12 months. For a long run, the company will save about $80-$90 million for a span of 3 years.
(Image: Albertsons store)