Grocery chain A&P files for bankruptcy

[Newsjock]

Source: Reuters

Grocery store chain Great Atlantic & Pacific Tea Co filed for bankruptcy on Sunday, drained of cash by tough competition and a sluggish economic recovery.

Once the largest U.S. grocer, the owner of about 400 stores under brands such as A&P, Waldbaum's and Super Fresh filed for Chapter 11 bankruptcy in New York with more than $1 billion in assets and more than $1 billion in debt, according to court documents.

As of Sept. 11, A&P had total debt of more than $3.2 billion, but it is unclear how much the company is currently carrying.

Read more: http://www.reuters.com/article/idUSN1217223320101213

[stray cat]

1. Delete

[thunder rising]

2. When EVERY nickel counts you gotta go with those Mega-Markets.

Walmart strikes again.

[Cirque du So-What]

11. I'm practically compulsive when it comes to price-checking

and believe me, Wal-Mart is NOT the be-all to end-all when it comes to low prices. No matter where you live, there is likely a regional or national grocery chain that has generic products cheaper than Wal-Mart and that runs specials on all products - generic and 'name-brand' alike; Wal-Mart seldom has specials of that type. When it comes to meat and produce, fuhgeddaboudit! Their pre-packaged meats are - without exception - always more expensive than those available at other stores, and the same goes for their limited selection of fresh vegetables.

People need to shake themselves from the drowsy acquiescence to the inevitability of 'always lower prices' at Wal-Mart. It simply is NOT true, especially where food products are concerned!

[Le Taz Hot]

21. That needs to be shouted from the rooftops.

I've found EXACTLY the same thing. Vons is the most expensive store in my town and I never go there, EXCEPT, every now and then they'll have an unbelievable sale on meats that I can't pass up. Wally World can't even come close. As for produce, I buy local. I have the satisfaction of knowing I'm DIRECTLY doing my part to support local farmers AND that my produce hasn't been imported from a country that uses pesticides long banned in this country. It also wasn't picked before it was ripe and then shipped 2,000. THAT produce tastes like cardboard and I don't know how people can eat it.

[Highway61]

31. Walmart = higher prices

Walmart succeeded is putting many out of business. Now that they accomplished that, they are sticking it to consumers. The prices have gone UP significantly in the past 6-8 months around here. They suck and alwasys have sucked.

[snappyturtle]

3. Sad. I remember grocery shopping with my mom at A&P when I was young.

I feel like everything I've known (has) fallen apart.

[bigworld]

4. A&P was the Wal-Mart of the 1950s.

Fascinating history.

http://en.wikipedia.org/wiki/The_Great_Atlantic_%26_Pacific_Tea_Company

[reformist2]

8. It's been a long, slow decline for them ever since.

Still, I 'm a little sad about it.

[melm00se]

22. this sums it up

Year...No. of Stores
1876.....67
1915.....1600
1925.....14,000
1930....16,000
1955....10,000
1965.....5,000
1970.....4,000
1978.....3,500
1980.....2,000
1990.....1,000
2000......600
2002......500
2008......460

if history repeats itself, this may be the same trajectory that WalMart may find itself

[thesquanderer]

27. number of stores

It's even more surprising more surprising to see that drop in number of stores in the last few decades considering that they also acquire a number of other supermarket chains in that time.

[melm00se]

33. yup

Unless extremely careful, the #1 market share leader tends to get arrogant and believing that everything they could do will be successful.

Pick just about any industry, watch how the #1 manufacturer in that industrial sector changes overtime.

These company's all lose their way and someone comes along and steals their lunch money.

[Ikonoklast]

35. They ended being majority owned by an insurance company.

A&P was such a good stock to invest in, with the growth and dividends it paid, that it's board was elected by, and the company run by insurance executives that ended up owning a controlling interest in the company and were clueless as to how to run a grocery retailer.


They refused to invest and build bigger store outside of the major metropolitan areas, where the population was booming in the fifties and sixties.

Their smaller inner city neighborhood stores were expensive to run, and profit margins were slim as they were locked into those smaller locations with little or no parking and no room to expand as customers demanded more variety.

By the late seventies, it was all over but the shouting.

[bettyellen]

5. my dad worked for them from age 16 to 58 and then they "laid him off"

reopened their warehouse 10 miles away, and hired new cheaper people. I think He made 12- 15 hour, and know he worked 50-60 hours a week.
Fuck them.

[Skink]

6. the same guy that pushed these guys into bankruptcy has been trying to take over

the company I work for. A judge this year ruled he could mount a takeover just by buying stock on the open market.

[Knight Hawk]

7. Too Bad

Worked for them when I was in high school in the late 50s.Were a great company at the time.They would not keep up with the times .Seemed to think 1955 was going to be forever.Starting wage 75 cents an hour.

[SCRUBDASHRUB]

9. I remember an A&P in Hampton, VA from the late 1970s.

[TheCowsCameHome]

10. I thought they were long gone.

They were in my area anyway.

[old mark]

12. They did not change with the times, and I think they were poorly managed, but

I'm sad to see them go - maybe they can be saved in some sort of buy out?


mark

[demosincebirth]

13. you can thank China Mart. and those other non union big Box stores. Thanks for

California law that does not allow Big Box stores to use more than 10% of its space for groceries. Keeps union stores competitive here in Ca.

[Golden Raisin]

14. Feeling old tonight.

No more A&P. No more PanAm. No more Woolworths.

[thesquanderer]

28. They're not gone yet

It's Chapter 11 reorganization, so they may survive...

[mahatmakanejeeves]

32. Actually, there is still a Pan Am, but

it's a railroad.

Huh?

Yes: It's the old Guilford Rail System

Pan Am Railways

As for A&P, their stores in northern Virginia were renamed Super Fresh.

I can't resist: Jefferson Airplane, Bark

[Orrex]

15. Has John Updike weighed in on this yet?

[happyslug]

16. I always like the story of the A&P on West Liberty Avenue in Pittsburgh

At the intersection of Wetzel and West Liberty Avenue in the South Hills Region of Pittsburgh, the Catholic Church Built one of its First Churches in the South Hills of Pittsburgh in the late 1800s. In the 1930s, A&P purchased the site (The parish was divided three ways before that time, losing Mt Lebanon and then Brookline to newly form Parishes, and the Church, by then known as St Catherines, moved to Broadway in the middle of Beechview). Brookline is on the East Side of West Liberty Avenue, Beechview is on the West Side of West Liberty Avenue.

Anyway, A&P purchased the lot, when the City of Pittsburgh received Stimulus money to convert the Streetcar Right of way from West Liberty Avenue to Brookline to what is now called Brookline Boulevard. At the same time, about a mile closer to Pittsburgh, the City received Stimulus money (this is 1938-1939) to build an access ramp from West Liberty Avenue to the Beechview Street car line (Which had its own right of way and bridge over Saw Mill Run and PA 51) so that the Dormont, Mt Lebanon and Brookline Streetcars no longer had to go to the West Liberty Avenue and PA 51 intersection (Which where the Liberty Tunnels had been since 1927) turn left and then right to get to South Hills Junction and the Streetcar tunnel (Built in 1905). No Streetcar went into Liberty Tunnel, but it removed the Streetcars from that intersection permitting the County of Allegheny to connect what is now called Saw Mill Run Boulevard to the Liberty Tunnels.

The removal of the Streetcars to their own ramp away from the Liberty Tunnel Intersection permitted not only more auto traffic but faster Streetcar service (The Streetcars had their own Tunnel through Mt Washington, still today used for buses and LRVs). The West liberty Streetcar ramp was used from 1939 till 1964 when Streetcars on West Liberty Avenue were replaced by Buses (Which then ran through the Liberty Tunnels). This lasted till the mid 1970s when the old Streetcar Tunnel was paved permitting buses to run through it. The Streetcar ramp was also paved, but do to the fact Streetcars always went almost in the same exact location, and buses do NOT do that (and thus you need more spaces between Buses going in opposite directions then you do streetcars) it is one bus up and one bus down on the ramp (as opposed to the old Streetcars which could go up and down at the same time).

Anyway back to A&P, I had always read that the A&P store replaced the church and took up about the same room as the church. I have never seen a picture of the Church, but given the time period it was build (the last 1800s) it would be small by today's standard (And when I checked on Penn Pilot of aerial pictures from 1939, this is confirmed a mid size building it located at the intersection of Wetzel and West Liberty Avenue in 1939).

Now, I alway through that the A&P Store replaced the Catholic Church at that intersection. A careful review of the Penn Pilot aerial photos of 1939 and 1967 clearly shows something else. When the A&P later went, was in 1939 an area of open fields, about one to two acres. Looks like it was a nature area/religious retreat area. The Church was on the South Side of Wetzel NOT the North Side of Wetzel as was the A&P and today's McDonald's. The Nature/Religious retreat area was to the North of Wetzel along West Liberty Avenue and it is clear that became the A&P soon after the photos were taken (OR the Church had been in the area later to become an A&P but was torn down long before the aerial photos were taken about 1939 and the large building to the South of Wetzel is just a large building not a Church).

Anyway, what looks like it had been a nice nature/religious retreat area in 1939, had by 1967 became an A&P and paved parking lots. By the mid 1970s A&P pulled out of Pittsburgh and sold the lot to McDonald's, which built a McDonald's on the Site. The McDonald's took up about the same space as the A&P but you did have a better designed parking lot.

If you want to look at aerial photos of the site see, which has area photo take throughout Pennsylvania in 1939, 1957 and 1967 (Give to take five years for each date):
http://www.pennpilot.psu.edu/
I used Photo APS-72-62


Just a comment on what happen to a local A&P, the big store or the 1920s-1950s, by the 1960s a small store that could not compete with the big boys AND not willing to provide the local services needed for people to go they and pay more. In many ways to big and to small. To big to change quickly and to provide what customers want TODAY, to small to justify ordering large numbers of one item so to spread the cost of selling those items over the maximum numbers of items sold. This is the problem with large stores, they MUST keep getting bigger to get more shoppers so to spread the cost of overhead over more items. Sooner or later it will fail, either someone else will build a bigger and more profitable store OR the store gets so large, you can NOT draw enough people in to justify the size of the store.

A&P had started as the largest food store that people could walk to. It catered to Auto Drivers, but as soon as the majority of people had cars, it should have abandoned its older stores (as being to small given that people can haul things in their Car) OR accept that its prices will be higher then stores that did go bigger. A&P wanted to milk its stores for all the profits they could, thus they did NOT expand (For that ate up profits) and did not provide additional services to its customers (For that ate up profits). A&P had to adopt one of those two policies, but could not. It was to heavily invested in its existing stores and thus would NOT abandon them (Like Walmart does to this day) but also did NOT want to put money into them to upgrade them so people feel their are getting something by paying extra (that would have required a whole corporate culture rebuild, something that is hard to do even if the Corporation wants to do it).

In its heyday (Which started in the late 1800s) A&P was the Walmart of its day. Providing the lowest over all prices and driving its competitors out of business by providing that low price (Prior to A&P it was common for people to buy items on "Credit", "Credit" not provided by a bank or credit card, but by the store owner who permitted people to buy things they needed today, and pay them when the customer received money (for example Farmers when the crops came in). Thus A&P, but refusing to provide "Credit" minimized its loss and thus maximized its profits. The problem was A&P had to continue down that same path, providing the lowest prices by cutting costs. That is a hard thing to do, for things change. When A&P started the best way to maximize profits was to buy and own the store you sold your goods out of. Once the store was paid for, no more rent had to be paid and thus maximize profits. The problem was that also tied to down to a location. To move you had to be willing to take a loss on the sale of an old store. How do you justify selling a store you paid $100,000 to buy for a Dollar? i.e a $99,999 loss? At times you have to do that for the store was NOT the most profitable location (Especially as more and more people with money purchased cars starting in the 1920s, accelerating in the late 1940s and early 1950s, thus a Great location in 1930 would be a terrible location in 1950, the first still served by Streetcars, but by the 1950s mostly low income people, the second, in the 1950s, nearer to people with cars AND their higher income).

Walmart did this transformation by staying in the most Car dependent part of America, Rural America. A&P had started in Urban America, where maximum profits were from the late 1800s till the 1950s, but by the 1950s Urban American was being left behind by the Car Culture of Suburbia. A&P needed to abandon Urban American and embrace Suburbia, but did NOT want to abandon its older, but paid for stores. That was A&Ps death sentence, a refusal to change. A&P had two choices in the 1950s, embrace suburbia or embrace quality over quantity. A&P chooses neither and started to fail in the 1960s (By which time it was to late, others had moved into the Niches A&P had left open).

Just a comment why A&P, the Walmart of the early 20th Century, failed in the second half of the 20th Century. I am surprised it is still in business, it is shadow of its former self and has no one to blame for its condition but itself.

[mrmpa]

41. Brookline kid here, remembers A&P on Sussex & McNeilly now a

Dollar Store and also on Sussex a Thorofare now an Aldis

[DesertFlower]

17. i loved A&P. they were across the street from

our apartment in brooklyn in 1960. didn't know they were still around.

[jaysunb]

18. My first "real" job was at A&P

After several years as a "wagon boy" (delivery service) I was lucky enough to get hired by the local store as what would now be called a courtesy clerk....bagging & stocking.
@.90 an hour , I was in Heaven ! It beat the shit out of my paper route that may net me $4.00 a week...if everybody paid. LOL

The Great Atlantic & Pacific Tea Company. RIP and thank you for my start in the workforce. :)

[On the Road]

19. They All Took the Super Fresh Name Around Here

Didn't even know they still operated as A&P.

I remember the stores from my childhood, but the local Superfresh was just not price competitive. At all. There was plenty of room to get more customers in the door. Shopper's is much, much better.

[Lugnut]

20. Bummer.

I worked for A&P in the 70s. In 1979 they started union busting activities by closing a bunch of stores and I lost my job. :nopity:

[BumRushDaShow]

23. They own Pathmark too

How could this article leave out their recent acquisition of Pathmark (in 2007)? The cost of that alone may have accelerated this action.

Sigh....

[LiberalEsto]

30. I thought Royal Ahold owned Pathmark? nt

[BumRushDaShow]

44. A&P took them over in 2007 but kept the Pathmark name. n/t

[Lucky Luciano]

34. My colleague has shorted GAP from $30 ever since the Pathmark acquisition.

He said a spot check of many of the stores showed them to be in poor condition compared to newer and cleaner supermarkets in direct competition with GAP. The cost of makng Pathmark useful did not make sense and he viewed the price paid as way too high. I think my colleague is kind of a prick, bur I congratulated him today nonetheless.

[KG]

24. explain to me again why government should be run 'like a business'?

[Blandocyte]

26. Great one-liner. I'm gonna use that! Thanks!

[Omaha Steve]

25. Another unionized company with a pension plan falls to Walmart

A&P has been challenged by the economic downturn and competitors including warehouse clubs and discount retailers, Frederic Brace, the company's chief restructuring officer, said in court documents.

He said legacy costs for three areas had hurt the company: leases in locations where the company no longer operates, an unfavorable supply agreement with C&S Wholesale Grocers - which supplies 70 percent of its inventory - and a transportation contract with Grocery Haulers Inc., and high labor costs including its pension funding.

[Ikonoklast]

36. The only good part is I hope C&S takes a hit at any bankruptcy proceedings.

They are an unbelievable bunch of shits, thieves and bad players.

Largest privately-held grocery retailer in the U.S., and no one that does business with them can stand them.

[LiberalEsto]

29. Good riddance

No matter what names they used for their stores, I could always tell if a supermarket was A&P-owned by the unbelievable dirtiness. Spills, flies, dirty floors, gross conveyor belts at the checkout.

[Javaman]

38. Where did you shop? Ours was always very clean. It's up to the management to keep that way. nt

[LiberalEsto]

42. Every single one

Every A&P I ever went into, from my childhood in Wayne NJ, to the one in Somerset NJ when I was in college, to the Fresh Express in Gaithersburg MD, and a number of others along the way, was dirty. My mother refused to go to A&P for the same reason.

[Javaman]

43. So you shopped in all the 400+ stores still left?

Or you shopped in all the stores still left operating when you still shopped at them?

I'm not going to take the word of an anonymous poster against my own experience.

[LiberalEsto]

45. Obviously you want an argument

off to my Ignore list

[Javaman]

46. Obvious you don't care for the opinions of other people. nt

[WhiteTara]

37. Sacking groceries at the A&P has always been

my back up plan in case of total financial emergency. This is tragic!

[RZM]

39. We never had A&P around here in my lifetime

But I remember years ago at a strategy session for passing a school levy, the superintendent brought up Kroger and A&P, saying the district had to be more like Kroger, which took off when A&P started declining because they were more 'adaptable.'

[fatbuckel]

40. It is the end of the world. Thank you to all the Chinese-shopping public.

[Kat45]

47. Ididn't know A&P was still around.

I haven't seen that store since I was a little kid. I though they had closed down decades ago,

[sarcasmo]

48. Another company with a long history in this country shutting down. 1892 if I am not

mistaken is when this company was founded. In related news, the USPS keeps on ticking.