Our Community Editors, a group of local residents who care and are passionate about local issues, answer this question: As the proposed $24.6 billion merger between Kroger and Albertsons remains up in the air, grocers and consolidation opponents are raising their voices. case, including Colorado Attorney General Phil Weiser, who sued to stop the merger.
What do you think?I see that a Kroger/Albertson merger that would combine the two largest grocery chains in the country would be bad for Colorado and the United States as a whole. Grocery is already an area with too few options and consolidated control, which is a big reason why we had major supply chain problems during the pandemic.We will not benefit locally if Safeway (Albertsons) and King Soopers (Kroger) merge. When Albertsons bought Safeway, some Colorado stores were closed and many employees lost their jobs or were forced to move to another store and take lower-wage positions.
We noticed the resulting poor performance and lower work ethic in our neighboring store. Not to mention what may seem like a huge selection on the shelves, but is actually dominated by certain mega brands and companies. The bigger the chain, the less enthusiasm there is to adjust product offerings or partner with local suppliers.UFCW Local 7 and other unions oppose the merger. In January 2022, more than 8,000 Colorado King Soopers workers went on strike to negotiate a better contract (and succeeded, despite the recently disclosed non-poaching agreement between Safeway and King Soopers).
These workers won more than a raise in wages and health benefits after being on the front lines during the pandemic. This experience will likely carry over into their personal and professional lives.Grocery stores primarily impact the community.
health Food industry expert Errol Schweizer (writing in Forbes) predicts that the merger would “further centralize the supply chains of industrial agriculture”, “It is unlikely that a chain of 5,000 stores will double down on local selection, seasonality and sustainability trends such as renewable energy, organic farming and climate-friendly plant-based food.”
With a greater selection of regional stores, we can support a wider variety of farms, ranches and other local producers—allowing for healthier food choices and economic and environmental benefits.I wish we had more independent grocers in Boulder, but fortunately we have a great Farmers Market and a variety of grocery stores, including several shops prominently displaying local produce. Smaller towns and rural areas may only have a few stores, and a Kroger/Albertsons merger would have an even more negative impact. So who would benefit from the merger? You guessed it. According to Schweizer at Forbes, “the combination would be great for investors and senior executives.”Diane Schwemm, parksidediane@gmail.comThe proposed $24.6 billion merger between Kroger and Albertsons has generated considerable debate, reaching well beyond that. the food corridors to the broader Colorado economy. -, to the labor and environmental arena.
While this may appear to be a simple competition issue, as King Soopers and Safeways may become dominant players, especially outside of urban centers like Boulder, a closer look reveals deep implications not only for consumers and employees, but also for overall control and leverage. this merger. would give suppliers and the labor market.A merger of two of the state’s largest grocery chains would give the resulting entity significant bargaining power, possibly at the expense of local suppliers. This increased leverage can constrain suppliers on prices and terms, which can affect the choice and quality of products available to consumers. Furthermore, the implications for unions are profound.
National unions that bargain at different supermarkets may face a reduction in their bargaining power when faced with a more monolithic corporate opponent. While Kroger believes the merger will result in $1 billion in higher wages and profits, I still have my doubts.
History and cynicism about corporate motives suggest that excessive profits are more likely to line the pockets of executives and shareholders than to enrich the first workers. This suspicion stems from the fact that large companies often promise profits that never materialize..
The rationale behind the mergers suggests survival against retail and e-commerce titans like Walmart and Costco. However, the lack of detailed examples of similar mergers and their outcomes leaves us in uncharted waters and questions the validity of this survival strategy.I confess that the complexity of this merger is beyond my knowledge.
As such, I believe that the decision to allow or prevent this consolidation rests in the hands of experts and officials who can deal with its multiple implications. If this merger happens, I hope we can demand comprehensive sustainability impact studies and comprehensive studies of the impact on suppliers, unions and union jobs. Such measures are crucial to ensure that the development of local markets is consistent with broader societal values ​​and protects those most likely to be affected.Hernán Villanueva, chvillanuevap@gmail.comThis proposed merger demonstrates a continuing common .
focus on corporate power: approval as Safeway and King Soopers form one in Boulder. If you have lived or visited other places, this also means grocery stores that you will recognize, such as City Market, Ralph’s, Vons, Kroger and Albertsons.The main group in this promotion is a venture capitalist that you can. don’t already have we heard is called Cerberus Capital Management. With the support of pocket investors, they bought Albertsons in 2013.
They then bought Safeway the following year. While market conditions have held back further consolidation efforts in recent years, one could innocently ask, “Why are they motivated to continue M&A?”If you were to read their statements in this case, you would be led to believe that they are doing so to provide “significant and measurable benefits for American consumers, as well as corporate partners and the communities we serve.”
Hmmm, have mergers ever had such a big impact on American communities?In fact, evidence can be found in another merger attempt in 2018, when Cerberus failed to merge Albertsons and Rite Aid because Rite Aid shareholders blocked it. Why? The main reason was that shareholder returns and profit opportunities were not profitable enough.In fact, these are the worn-out stories of shareholder-motivated profit-seeking. This particular merger would tip the scales so that most supermarkets in Colorado would be controlled by Cerberus.Among voters in opposition, the proposal threatens workers.
That’s why unions representing grocery store workers oppose it, in part, because it could stagnate or lower wages. However, these mergers hurt buyers. Among many reasons, this could lead to “food deserts” if Cerberus decides to close some of the less productive stores. It also increases the ability of big business to engage in so-called “greedy inflation,” where companies keep food prices high even when inflation has slowed, continuing to make big profits..
