Should Krogers and Albertsons Be Allowed To Merge?

Page 2 - Seeking answers? Join the AnandTech community: where nearly half-a-million members share solutions and discuss the latest tech.
Toggle sidebar Toggle sidebar

Allow two grocery giants to merge?

  • Yes

    Votes: 3 11.1%

  • No

    Votes: 24 88.9%
  • Total voters
    27
SteveGrabowski

SteveGrabowski

Diamond Member
Oct 20, 2014
8,734
7,347
136
JM Aggie08 said:
Absolutely wild that Albertson's is still around.

No matter who merges with who, HEB > *.
Click to expand...

Meh HEB drove both Albertson's and Kroger out of San Antonio and now all the only bar HEB has to clear is being a little better than Walmart. Which they just barely clear nowadays.
 
NutBucket

NutBucket

Lifer
Aug 30, 2000
27,127
616
126
manly said:
I'd have to see the market share numbers; IIRC Walmart is actually the nation's leading grocer in market share. But I don't think anyone has a particularly dominant position, as competition is fierce and margins are very tight for groceries. However, you're right that this merger is likely to not be good for consumers. Kroger (Ralphs) and Albertsons (incl. Vons) are major grocers in L.A. County, so they'd have more pricing power combined than with the status quo. There are a lot of Latino supermarkets in SoCal that compete fiercely on price alone.
Click to expand...
“According to our 2021 estimates, a merger between Kroger and Albertsons implies 19% combined share of the U.S. grocery market (pre-divestitures), which compares to 25% for the largest player Walmart (30% including Sam’s Club) and 9% for the third-largest player Costco. … Store overlap for Kroger and Albertsons appears heaviest in Southern California, Chicago, the Pacific Northwest, eastern Texas (Dallas and Houston), Denver, Phoenix and the greater Washington, D.C., area.” — Robert Ohmes, BofA Securities
unknown.png
 
M

manly

Lifer
Jan 25, 2000
13,083
3,848
136
NutBucket said:
“According to our 2021 estimates, a merger between Kroger and Albertsons implies 19% combined share of the U.S. grocery market (pre-divestitures), which compares to 25% for the largest player Walmart (30% including Sam’s Club) and 9% for the third-largest player Costco. … Store overlap for Kroger and Albertsons appears heaviest in Southern California, Chicago, the Pacific Northwest, eastern Texas (Dallas and Houston), Denver, Phoenix and the greater Washington, D.C., area.” — Robert Ohmes, BofA Securities
View attachment 70525
Click to expand...
Thanks, I had a feeling this merger is bad for SoCal (and a few other regions) but it's apparently worse than I thought. I personally do most grocery shopping from Ralphs and Albertsons, so it would definitely have an impact. The good news is there are a lot of Latino supermarkets in L.A. County to choose from, in many (but not all) neighborhoods.

The Slate article @KMFJD cited is very illuminating (didn't think it's even possible for a non-luxury grocer to have high 20% gross margin!). Net profit margins are typically mid to low single digits.
 
Fenixgoon

Fenixgoon

Lifer
Jun 30, 2003
33,050
12,433
136
if company A buying company B involves multiple billions of dollars changing hands, my default position is "no".
 
  • Like
Reactions: KMFJD
MtnMan

MtnMan

Diamond Member
Jul 27, 2004
9,365
8,703
136
No!
I don't have a dog in this play park, as neither are anywhere near me. Closest one is about 60 miles away in a different state.

But it is a trend, to create a monopoly they set the prices to what ever the fuck they want. I also fear that this won't be the end, and they will be buying out other chains of grocery stories to further eliminate the competition.
 
  • Like
Reactions: esquared and Fenixgoon
Captante

Captante

Lifer
Oct 20, 2003
30,340
10,859
136
SteveGrabowski said:
Meh HEB drove both Albertson's and Kroger out of San Antonio and now all the only bar HEB has to clear is being a little better than Walmart. Which they just barely clear nowadays.
Click to expand...

I can't speak for how it is in your area, but here in Connecticut Walmart seems to get it's own "special" smaller/lower grade version of the food products they sell and also an inordinate number of expired/nearly expired product is still on the shelves.

The identical brand-product from Stop & Shop or ShopRite (local chains) is slightly more expensive across the board but is also nearly always worth the extra cost. (and this doesn't factor in the "value" of avoiding Walmart !!!)
 
SteveGrabowski

SteveGrabowski

Diamond Member
Oct 20, 2014
8,734
7,347
136
Captante said:
I can't speak for how it is in your area, but here in Connecticut Walmart seems to get it's own "special" smaller/lower grade version of the food products they sell and also an inordinate number of expired/nearly expired product is still on the shelves.

The identical brand-product from Stop & Shop or ShopRite (local chains) is slightly more expensive across the board but is also nearly always worth the extra cost. (and this doesn't factor in the "value" of avoiding Walmart !!!)
Click to expand...

They're pretty similar in San Antonio other than store brands. HEB's store brands are way better for things like bread, Walmart's are way better for say cereal. And Walmart has a surprisingly good store brand ice cream (not frozen dairy desert) that's just as good as the HEB store brand ice cream for about 35% cheaper if you want simple flavors like vanilla, strawberry, or cookies and cream. Though for the fancier ice creams HEB does have two store brand flavors in white chocolate raspberry and caramel pecan turtle that are worth the higher price if you're really craving them. They're all good enough that these days the only time I buy Blue Bell is if I really want either homemade vanilla (best vanilla ice cream out there) or cherry vanilla.
 
  • Like
Reactions: Captante
AdamK47

AdamK47

Lifer
Oct 9, 1999
15,675
3,529
136
Kroger is based in Cincinnati. The company I worked for last year was losing people left and right to Kroger. Dev Ops, Java devs, PMs, tech writers, anyone in software development. They were growing at an astronomical rate. They wanted local people. With the tight talent pool they were offering big money.
 
Lost_in_the_HTTP

Lost_in_the_HTTP

Lifer
Nov 17, 2019
13,229
7,851
136
^^ And I won't set foot in a Kroger store. They have a low price, no frills subsidiary chain that isn't too bad though.
 
Lost_in_the_HTTP

Lost_in_the_HTTP

Lifer
Nov 17, 2019
13,229
7,851
136
Slamming on the brakes.

California, others ask court to temporarily stop $4 bln Albertsons dividend payment

www.reuters.com.ico
Reuters|2 hours ago
The attorneys general of California, Illinois and Washington D.C. asked a federal court on Thursday for a preliminary injunction that would prevent Albertsons Companies Inc , which is being purchased by rival Kroger Co ,


...
 
AdamK47

AdamK47

Lifer
Oct 9, 1999
15,675
3,529
136
Lost_in_the_HTTP said:
Update:

Kroger, Albertsons selling more than 400 stores in $1.9B deal as they look to close their merger​

abcnews.go.com.ico
ABC|1 hour ago
Grocers Kroger and Albertsons are selling more than 400 stores and other assets to C&S Wholesale Grocers in an approximately $1.9 billion deal as part of their efforts to complete their merger
Click to expand...
Funny how this news coincides with the news of Kroger having to pay $1.2B for their involvement in the opioid crisis. Bad news Friday. AKA: The Friday news dump.
 
Last edited:
G

Greenman

Lifer
Oct 15, 1999
21,983
6,297
136
Krogers is awesome. Never set foot in one till a year ago. My wife is all up in their deals and specials, filled my truck at the Krogers pump for a buck nine a gallon.
 
You must log in or register to reply here.

TRENDING THREADS

COMPANY
RESOURCES
FOLLOW
Top Bottom