FIRST OF THE
A&P ACQUIRED STORES
TO CLOSE
Location: 295 Ferry St, Newark, NJ
This location will close by the end of June. Photos and analysis of the situation can be found on styertowne's flickr collection. Additional photos can be viewed on supermarket fan's flickr collection. Thanks to supermarket fan for sending in the news!
I'm suspecting I shouldn't be surprised by this, or more in the future.
ReplyDeleteNeedless to say I'm disappointed. I had hoped the company had learned from its countless past mistakes (insane pricing, giving up on important markets, etc.) and was going to be serious about being one of the premier grocers in the northeast (and especially NJ, Philly, etc.) I am feeling more and more this will not be the case, which makes me wonder why all the money and effort was spent in the first place.
Why ignore the blueprint left behind? Why ignore the fact that this part of Newark wants ethnic offerings and not the stuff typical of neighborhoods ten miles away? How blind (or stupid) can they be?
I'm close to one Acme store that does it right, and another (this one a converted A&P) that gets it so wrong, despite an extensive remodel and being open 24 hours a day. The prices are high. The staff is miserably inefficient and indifferent. And because of all that, the gigantic store is empty most of the time. I only shop there when nothing else is open, otherwise I'm going to Stop & Shop, Whole Foods, or even ShopRite. I feel as if someone handed Acme a guide as to how to properly run a grocery store, and they decided to do the opposite of everything they read. It's pathetic.
I hope they get their you-know-what together. If a financially-ruined company like A&P could do well with some of these locations, why can't Acme, which is part of a huge national corporation that's NOT losing money? I mean, some of these stores? You have to try hard to mess them up. I guess that's where they're focusing their efforts?
The stores in Clark,Kenilworth and Old Bridge always seem to be pretty busy
ReplyDeleteI feel like Clark gets spillover from the very large and busy ShopRite nearby. I'm probably not the only one who sometimes shops there just because of how overwhelming the ShopRite can be.
DeleteKenilworth and Old Bridge, on the other hand, seem to be in busy areas with few other options. All three of these markets are also definitely better oriented towards Acme's typical business model than the more urban locations are.
Acme, Dosent usually have much of a tract record in urban ethnic neighbor hoods.The cost of merchandising to one store that dosent fit in with the rest of the chain is extremely expensive, ad in high costs of operations in City Stores Theft, high rents and low volume killed this store. If the rent on a store is cheap, the store is small enough to turn product,you can still run a profitable lower volume unit. But the size of this barn made thatimpossible
ReplyDeleteHigh rent/low volume... then why did Acme take it over in the first place?
Deletepromise if gentrification a d upper dollar people coming into the neighborhood. They found that they could not wait long enough. Heck they are humans just like you and me We some times make mistakes,they do to.I give them credit for seeing their mistake and moving on
DeleteYou can limit some of the risk involved in offering ethnic/natural products by utilizing local/regional ethnic/natural food distributors. You lean on them for their category management knowledge. The main investment you have to make is deciding what space to allot to them. Either dedicated sections or facings in existing sections. Goya, Haddon House, KeHE and UNFI are all viable options in these areas.
DeleteThe DSD items may have a lower margin (though some of them are quite profitable), but the risk and investment are lower for the stores. You let them handle credits versus either throwing things away or sending them to a return center. You do have to modify your planograms but with everything being electronic a lot of the hassle is taken out. You just need a good relationship between the supplier and store category managers.
Overall the ethnic business is growing even beyond traditional ethnic strongholds. Though if you do operate in one of those areas, and you want to be successful you must carry relevant items or your competition will and you will not survive. That's why knowing your demographics is critical. You can't arrogantly plop your generic store in a strong ethnic area and expect to be successful. There are data mining and research companies who can provide very detailed demographics for the area you want to move in to. You also have to look at what your competitors are doing.
I work for a DSD vendor and we have the flexibility to adjust brand facings, what items to carry/not carry, what to offer for immediate consumption, etc. In general chains can be very, very specific about planograms but outside of that you are empowered to make decisions that are best for the company as well as the customers and consumers. Segmentation is very important.
Going back to the "why did they pick up the store" question...wasn't it Acme's idea to grab the highest volume Pathmarks and A&Ps in the area? That to me makes this store's flop even more curious. Why would this store suddenly lose that much business and close within two years? Unless the rent situation down there is really that untenable (and I wouldn't be surprised considering what happened to some North Jersey stores).
DeleteThe Old Bridge store has a smaller Village Markets ShopRite down 9 a few miles to the North but that is about all.
ReplyDeleteOld Bridge also has a Walmart Supercenter as copmatition nearby but it is on Route 18 that may give it a bit of a buffer.
ReplyDeleteSeems most of the stores are on Route 18 (many probably considered East Brunswick, but not really all that far away) - though less than there used to be (did the Pathmark there get anything else - I know the A&P turned into a Stop&Shop)?
DeleteAlso - has that ShopRite on 9 ever had anything done with it? It always seemed to be an older store with little, if any upgrading/expansion over the years (unlike the one further up 18 that remodeled a couple times, finally getting rid of the "low" section that used to be there where you entered).
The East Brunswick PathMark has been replaced with Aldi and Burlington Coat Factory.
DeleteAnd yes, that route 9 ShopRite looks very dated and generally uninviting. Not surprised that it's no threat to Acme.
I have found that the Milltown Acme on Ryders Lane to be considerably busier sine the demise of the East Brunswick Pathmark and the North Brunswick A&P. It also helps the the Saker ShopRite on 18 is a Madhouse muck like the ShopRite in Clark.
DeleteIt's pretty much fully explained if you read the explanation on flickr. It was a high volume store but Acme didn't correctly merchandise the store to the neighborhood. They took it from high volume to low. The rent explanation is a weak excuse from the fanboys. People said the same thing about Clifton, and the new store in there is a big success.
DeleteThe employees of that Acme were saying it. The Styertowne Acme had low volume from day one, and it never seemed to improve. There were people that shopped the old Clifton Plaza store that didn't want to follow them down so they went elsewhere. The Broad Street Stop & Shop and Little Falls Shoprite got a lot of extra business from that.
DeleteIt was a miracle quite frankly that the Acme in Styertowne stayed open as long as it did. And from what I've been told about Seasons, their business is starting to slide.
Fanboys? Gee after,50 years in this business, I just might have some knowledge about my business. There are stores out there that are high volume and really don't make a profit. Just like stores in Delaware have cheaper rents, then those in North Jersey, that is a simple fact. The cost of labor is more expensive in the NY Metro region, then in Delaware, that is also a fact. The cost if advertising is extremely more expensive in North Jersey ,then in other areas that Acme runs stores. This means you have less wiggle room to make a profit in lower volume stores. So before you call some one a fanboy,learn something about the business first. The amateur hour can be refreshing and amusing
DeleteI'm not surprised. Hell, I was surprised that Acme went after Pathmark's Newark stores in the first place as they seemed to be an odd fit. For all the stupid things Pathmark did over the years (pre and post acquisition by A&P) they knew what their customer bases were and laid the stores out accordingly. The Paterson store was a prime example of that, as they catered to the ethnic makeup of the neighborhood (big Caribbean influence).
ReplyDeletehttp://www.supermarketnews.com/retail-financial/albertsons-q4-comp-declines-accelerate
ReplyDeleteAlbertsons lost money last year...
Acme didn't "go after Newark and some other high volume" stores....they were part of the bankruptcy deal. Just as keeping the pay rates that are up to $5.50 more per hour in the new stores with the old a&p and Pathmark employees.
ReplyDeleteFrom what I hear, Acme stores that were acquired from A&P kept their high pay scale and were even given a raise in pay recently and were also offered a buyout. The pre A&P Acme's also were offered a buyout. Very few employees accepted this offer. The company seems to over staffed at the upper echelon area. The heard will be thinned out over a few years and the profitable locations will thrive, but the store closures can stop if Acme BEATS their competition in targeted locations. God Bless America and Acme.
DeleteAcme is getting rid of the former A&P and Pathmark employees in my area by forcing them to transfer to stores far away. Of course most are just quitting which is exactly what Acme wants so they can bring in cheaper labor. Meanwhile, service at these stores is in absolute free-fall.
Delete