America’s number 2 grocery retailer has told the media that it had a “tough quarter” recently, including settling 8 class action lawsuits brought against it by its own employees. Albertson’s is reported to be tied now with Wal-Mart as the number 2 grocery chain in America. The top banana is still Kroger’s, which has 10% of the nation’s $449 billion food store market. Wal-Mart and Albertson’s are hot in pursuit with 9%, and Safeway is number 4 with 7%. That means 4 grocery chains now control 26% of the food sales in America. Wal-Mart has chewed its way from #8 in grocery sales a year ago, to # 2 today. Albertson’s recently had to dump 145 stores as part of a merger agreement with American stores, in a concerted effort to become a bigger company. They also had to shell out $37 million to end lawsuits brought by their own workers, who charged that the company was forcing workers to work “off the clock” without compensation. The settlement means that current and former Albertson’s workers who were subjected to the no-pay work hours can now file claims. Albertson’s admits they don’t know how many claims will arise, but they have agreed to the $37 million figure, including lawyers’ fees. “We are dissappointed with our earnings,” one company official admitted. The company is based in Boise, and has 2,500 grocery stores in 38 states.
Albertson’s is under great pressure to keep up with rivals like Wal-Mart. Albertson’s plans to add 90 new combination food and drug stores in the year 2000, and then another 100 stores in 2001. While this is about half the rate of new store construction being planned at Wal-Mart, it is still a very aggressive expansion plan for Albertson’s that is likely to make many communities unhappy.
