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A Background Analysis of Four Major Food Chains in the US

16 May 2017Other Essays

Four of the largest food store chains in the United States are veritable household names—Whole Foods, Kroger, Safeway, and Albertsons.

Whole Foods Market, now the largest retailer of natural and organically-grown foods in the world, carries a variety of merchandise—from produce, meat, poultry, baked goods, prepared foods, wine, beer, cheese, skin and body products, pet products, and household products. In line with the nature of its product lines, Whole Foods puts an emphasis on social responsibility and environmental awareness. In fact, it ranks second among businesses listed in the US Environmental Protection Agency’s Top 25 Green Power Partners (Whole Foods Market, IP, LP, 2000-2008).

According to the Whole Foods Market website (2000-2008), the successful chain started out on a $45,000 loan taken out by John Mackey in 1978 with the name Saferway, a spoof of retail giant Safeway). Now, it is one of the biggest companies in the country and prides itself in its singular mission of selective merchandise that strictly follows set quality standards, as well as a commitment to agriculture. With headquarters in Austin, Texas, more than 270 outlets in the USA and UK, and employing close to 55,000 people, Whole Foods subscribes to a symbiosis of food, people, and earth—an interdependence brought upon by a common objective of health and environmental protection.

Whole Foods’ products are sourced locally and internationally, with a special focus on small, dedicated, and specialized food suppliers. Quality of food, healthy eating, and concern for the environment are the main thrusts of the organization, as evidenced by its company motto—“Whole Foods, Whole People, Whole Planet”. As connecting values, Whole Foods also centers on customer satisfaction and local community involvement, donating 5% of their profits to local non-profit organizations. Sustainable agriculture, re-usable packaging, as well as animal welfare and reachout programs (through the company’s Animal Compassion Foundation and the Whole Planet Foundation, respectively) are all part and parcel of the Whole Foods vision of a better, balanced, and holistic lifestyle for all (Whole Foods Market, IP, LP, 2000-2008).

Another iconic food company, The Kroger Co., holds permanent headquarters in Cincinnati, Ohio—the same place where it was founded by Barney Kroger in 1883. Distribution and merchandising are the main tasks of the company, in the lines of pharmacy, personal care, food, and other related products (The Kroger Co., 2007).

The Kroger Co. website (2007) narrates how Barney Kroger was motivated by the thought of selling merchandise he would want to buy for himself—a mindset that serves as the Kroger ideology to this day. Quality was always the company’s foremost consideration, which led to the Kroger tradition of baking and selling their own bread and pioneered the sales of groceries and meats in a single shop. The business smarts of Barney Kroger benefited the company’s image as well as its profits, and through this the Kroger signature of food manufacturing was born. Today, Kroger boasts of 8,000 corporate-branded items, with more than half manufactured within the Kroger plants. A major turning point in the Kroger company history was the 1999 merger with Fred Meyer, Inc., which resulted in an incredible chain of supermarkets surpassing all others in terms of geographic coverage and availability of formats—from department stores, warehouse-style outlets, convenience branches, fine jewelry shops, and, of course, supermarkets. This union created more room for improvement and growth in all aspects of the Kroger system, including purchasing and manufacturing, made for an exemplary merger that succeeded where others had failed (The Kroger Co., 2007)..

Barney Kroger’s original business model, patterned with the ideals of service, value, and selection in mind, still comprise the guiding principles of the company today. These have been further identified in a set of corporate values, which include honesty, integrity in business and professional relationships, respect for others, diversity in the workplace, safety for one’s self, coworkers, and customers, and inclusion or active participation in the company’s operations. The Kroger Co. has also initiated activities and supports charitable efforts through The Kroger Co. Foundation, which addresses the concerns of Kroger-affiliated communities; the Fred Meyer Philanthropy, a commitment of Fred Meyer Stores to its various neighborhoods; and The Ralphs/Food 4 Less Foundation, which serves the citizens of Ralphs and Food 4 Less and Foods Co. locations.At present, The Kroger Co. enjoys top-of-mind and actual brand awareness and business success as one of the leading food manufacturing and retail companies in the country (The Kroger Co., 2007).

The official website of Safeway, Inc. (2007) indicates how the year 1915 saw the efforts of the young M. B. Skaggs of American Falls, Idaho, as he bought a small grocery store from his father, with the goal of providing potential customers more value for their money and to grow the business by keeping a small profit margin. This was the start of something big, for in just a little over ten years, Skaggs listed 10 states carrying 428 of his stores. Soon after, he merged his company with the also-popular Safeway chain of stores, which resulted in doubling the size and worth of the Skaggs business. The advent of the Great Depression did nothing to faze the lofty ambitions of Skaggs—he continued to focus on giving more products that equated to value for his customers’ money. Safeway emerged as a success throughout the decade well into the 1930s, when it pioneered more efficient and customer-friendly retail concepts such as per pound pricing and open dating for perishable goods, as well as nutritional labeling. In the midst of all these retail innovations, Safeway even managed to push convenience levels by offering the first parking lots to service its customers.

Today, the vision of Skaggs still remains at the core of the Safeway promise of value. However, everything is now on a larger scale—with close to 1,800 stores strategically located across the US and Canada, which include the company-owned Vons, Randalls, Tom Thumb, Genuardi’s, and Carrs stores. Branding proved to be the best representation of the value principle, and is currently carried out in Safeway’s successful establishment of private label programs. Some of these brands are known to customers by name, such as Mrs. Wright, Lucerne, and Safeway—marking over 3,000 quality products—and the prestigious Safeway Select, which stands for premium merchandise (Safeway Inc., 2007).

Safeway’s success has paved the way for more altruistic objectives, such as significant partnerships with communities across the nation. America’s Second Harvest, a collective of food banks, has benefited greatly from Safeway’s donations of merchandise, with the same efforts extended to other organizations dedicated to provide hunger relief. $25 million was awarded to educational programs, and $15 million to fundraising projects for breast and prostate cancer treatment, education, and research. Local and international disasters have also figured in Safeway’s list of priorities, with the provision of #3.6 million for tsunami victims in South Asia and Africa, as well as $3.7 million towards the needs of Hurricane Katrina victims. Safeway also upholds the importance of environmental leadership, starting early on with cardboard recycling since 1960. At this time, by partnering with the Environmental Protection Agency, Safeway is by far the biggest commercial buyer of renewable energy. Also, diversity is one of the company’s major programs, giving opportunities for employment and business to a variety of cultural and ethnic groups (Safeway Inc., 2007).

Idaho-based grocery chain Albertsons counts up to 325 supermarkets to its name, located mostly in the mid-west. It originated as Albertsons Inc., founded in 1939 by Joe Albertson, and was a prime example of innovation and progress in the supermarket industry—its money-back guarantee, free parking and a convenient ice cream shop were all fresh concepts that attracted many customers. However, just in 2006, Albertsons Inc., was bought by Supervalu and CVS/pharmacy. The acquisition included Albertsons Inc.’s 661-store lineup as well as its distribution centers and offices, to be classified all under Albertson’s LLC (Albertson’s, 2008).

But Joe Albertson’s vision of value, quality, and a unique brand of customer service remains. This was the guiding thought behind Albertson’s partnership with Osco Drug’s Sam Skaggs in the 1960s, which produced the first food-and-drug store concept. A series of events took place through the years, dissolving the partnership, only to be revived in 1998 with the merger of Albertsons and Skaggs’ American Stores Company. By this time,

Albertsons already had the renowned reputation of being the friendly neighborhood food and drug store, in accordance to its stated mission and vision. Albertson’s prime thrust was to create a financially-sound business through the experience produced by a pleasant shopping environment, and a workplace dedicated to the comfort and convenience of its employees.

From Joe Albertson’s original philosophy of giving the customer the merchandise they want, at the price they want, with much care is still the focus of Albertson’s LLC today. It still is America’s favorite neighborhood store, with every customer assured of the Albertson’s style of commitment to service (Albertsons LLC, 2007).

References

  • Whole Foods Market, IP, LP (2000-2008). “Company: The Whole Philosophy/History”. Retrieved from http://www.wholefoodsmarket.com/
  • The Kroger Co. (2007). “Company Information: About the Kroger Co.” Retrieved from https://www.kroger.com/
  • Safeway, Inc. (2007). “About Us”. Retrieved from http://www.safeway.com/
  • Albertson’s (2008). “About Albertson’s”. Albertsons LLC (2007). “About Albertsons: A Tradition of Service”. 

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