A&P inks new deal with C&S Wholesale Grocers
MONTVALE, N.J. — Grocer A&P has entered into a new supply and logistics agreement with its principal wholesale supplier, C&S Wholesale Grocers, that is estimated to generate a run rate of more than $50 million in annual savings. The revised contract must be approved by the bankruptcy court.
Under the revised contract, if approved, the annual savings will be realized in cash beginning upon the company’s emergence from Chapter 11 pursuant to a plan of reorganization. The new agreement also will help the retailer generate cash savings in the short-term by improving supply chain and operational efficiency, as well as providing the company with key service enhancements.
"The approval of this new supply and logistics contract with C&S will mark a key milestone for A&P as we move forward with our restructuring," A&P president and CEO Sam Martin said. "The agreement will strengthen our existing relationship with C&S as we work together to drive service delivery and reliability enhancements and substantial efficiencies across our operations. The anticipated annual savings will significantly reduce A&P’s cost structure upon emergence from Chapter 11, while ensuring consistent product availability in our stores and greater diversity of products for our customers."
The company anticipates that the court will consider its motion on the new C&S contract at a hearing later this month.
Investing in multichannel strategies will help retailers in long run
WHAT IT MEANS AND WHY IT’S IMPORTANT — Perception feeds reality. That is as true today as it was when the economy first started its rollercoaster plunge back in 2008. The perception is that the consumer is on her way back. And while that is fast becoming reality, today’s retailer will be looking to commit its capital expenditures to more than just the traditional new Main-and-Main locations.
(THE NEWS: Survey: Retail industry capital spending to rise 16% in 2011. For the full story, click here)
Retailers today are making significant investments into their multichannel strategies, including online and social media, and that’s because new stores aren’t necessarily the most economical way to generate that wow factor and positive shopping experience. Consumers only are cautiously optimistic about the immediate future of the economy, which means many of the value-driven shopping habits that were learned over the course of this latest recession are here to stay.
And two of the things consumers learned were how to comparison shop at the shelf with their smartphones and how to identify deal opportunities through such sites as Facebook and a myriad of extreme coupon-driven blogs.
Shoppers no longer are expressing their preferences by driving across the lot in favor of one retailer over another. Along with their community of “friends,” they’re “liking” their favorite retailers long before that key goes into the ignition, and likely have done their comparison-shopping long before they’ve walked into the store. And, they post the really good deals on their Facebook pages so that all of their friends can take advantage, too.
Investing in new multichannel avenues more completely satisfies the needs of today’s shoppe r— giving the consumer what they want, when they want it and where they want to get it. That multichannel consumer is worth three times the value of the shopper who only visits Main-and-Main, according to Walgreens.
Editor’s Note: For more on what Walgreens and other retailers are doing to own the multichannel consumer, see “Think. Click. Buy,” the cover story of the current issue of DSN, here.
Report: Sam’s Club to roll out private-label brands
BENTONVILLE, Ark. — Sam’s Club is expanding its foray into the private-label business by focusing on consumables.
According to an Associated Press report, the retailer is launching a private-label baked goods line called Artisan Fresh, Simply Right, a personal care collection, and Daily Chef, which includes groceries.
The brands, which will roll out this fall, will replace Sam’s Club store brand Members Mark, AP said.