I Help Companies Build and Scale Products by Translating CEO Vision into Insightful Strategy, Meticulous execution, and Strategic commercialization | Digital Strategy and Growth Consultant | X PwC & Cognizant
Kroger-Albertsons Merger: Don’t fight the future. Washington State Attorney General Bob Ferguson sued in local court to block the proposed Kroger-Albertsons grocery merger, stating that it would significantly limit shopping options and create a virtual monopoly in the state. The merger of Washington's two largest supermarket companies could lead to higher prices and fewer consumer choices. A plan by Kroger (Fred Meyer, QFC) and Albertsons (Albertsons, Safeway, Haggen) to mitigate the merger's impacts by selling over 100 stores in Washington is deemed inadequate by Ferguson, as it would still leave Kroger with a near-monopoly in many markets. Together, K-A would control 13% of the nation's grocers, second to Walmart’s 22%, with Amazon coming in at 3%. The lawsuit seeks a permanent injunction to block the merger nationwide. The joint Kroger-Albertsons response is to remain competitive against Walmart and Amazon (Whole Foods, Amazon Fresh, online); they must combine their footprint and buying power. K-A has grown significantly over the years through mergers. Their 2022 promise was · $1B administrative savings. · $500 million into price reductions. · $1.3 billion updating Albertsons stores. · $1 billion on higher employee wages. The industry has continued to consolidate, and mergers are inevitable. Rather than another messy, should they or shouldn’t they court fight spending taxpayer money, my $.02 — bring K-A to the negotiating table. Some observations: · Draft and create a plan that lays out how consolidation will work. Involve local communities, unions, and regulators. · Commit to retail store footprints in food deserts. Work with city planners and civic organizations. · Invest some of that $1.3B to make the grocers destinations and form partnerships. · Invest some of that $1B in employee education and upskilling. Food for thought, and I’ll agree to waive my fee to work with all parties. What do you think? Fight the future, stop the merger, or bring everyone to the table? Finally, in a bit of irony, the AG’s complaint is hosted on AWS. https://lnkd.in/gHtAbiUa #KrogerAlbertsonsMerger #GroceryMonopolyConcerns #FergusonLawsuit #SupermarketCompetition #ConsumerChoiceMatters
I Help Companies Build and Scale Products by Translating CEO Vision into Insightful Strategy, Meticulous execution, and Strategic commercialization | Digital Strategy and Growth Consultant | X PwC & Cognizant
9moAn updated statement from K-A. The tl;dr is "We're anticipating closing by end of July 2024. Stay tuned for more details while we work this out." - My take is there is a lot of work and I maintain they need to come to the negotiating table with an open heart and mind. "We remain in active and ongoing dialogue with the Federal Trade Commission and individual state Attorneys General regarding our proposed merger and divestiture plan. We believe our merger with Albertsons and the comprehensive divestiture to C&S will result in the best outcomes for customers, associates and our communities. In light of our continuing dialogue with the regulators, we are updating our anticipated closure timeline. We currently anticipate that the closing will occur in the first half of Kroger’s fiscal 2024. While this is longer than we originally thought, we knew it was a possibility and our merger agreement and divestiture plan accounted for such potential timing. We remain committed to closing the transaction and providing the meaningful and measurable benefits that we promised when we originally announced the transaction.”