Very rare pro-consumer W
Very rare pro-consumer W
Is it though? I fear that all this will do is allow WalMart to clobber them individually then take over their market share. A&K combined are already smaller than Wally World. (13% vs 22%). It would actually be more helpful to the grocery market if they forced Walmart to divest, what their doing with this is likely to end up with Walmart taking it all.
I actually agree. They’re targeting the smaller fish in "big business " when they should be focusing on Walmart amazon google and the like
The FTC has always been harsher about monopolization via mergers versus business finding success independently. Not saying that’s the right way to handle things, but Walmart got to where they are through competing, not merging, with other businesses.
Why not both
As a Canadian, what’s it like?
It’s like walking out of a doctor’s office without thousands of dollars in debt… I assume.
Two of the major chains in my area merged a while back and they were required to close down a few of their stores to prevent having a monopoly.
So of course they closed the stores that were under-performing, which just means they closed the ones in poor neighborhoods.
They still owned or kept the leases to the buildings and sub-leased them out with the stipulation that any business taking them over could not carry groceries.
Not only are the people in those areas having to drive a lot further (or spend more time on public transit), but a lot the surrounding businesses to the stores that closed down ended up going out of business themselves.
There’s at least one nearly abandoned mini-small, shopping plaza in town due to this.
Wow never realized it but same. Clemens and Acme went under, then Superfresh. All those shopping centers are still empty or near barren and that was like well over a decade for those to go under
that seems like anti competitive behavior, I wonder if those kinds of stipulations could be made illegal. Also a commercial vacancy tax probably wouldn’t hurt.
They are legal. This is/was Walmart’s M.O. for anticompetitive behavior when one of their stores closed. Any competitors couldn’t lease, other businesses failed when they moved and didn’t have the traffic, and so you are left with both an unoccupied eye sore as well as a food / product desert…
Good idea on the vacancy and potentially changing the law to prevent anti-competitive stipulations like that.
If they won’t let others use it they should be compelled to sell it.
As an Australian who has to deal with the duopoly of our grocery stores after we let them all merge years ago, it absolutely will drive higher prices and nobody who isn’t a shareholder should want this.
They basically “collude” to fix and raise prices here and have whole teams of people who’s job it is to monitor and extract as much money out of us as possible. They also force growers to accept shitty deals or they reject their produce due to “not meeting their quality standards” and there’s basically nowhere else for them to sell it in the quantities they need to.
Nobody wins in grocery store mergers except the shareholders.
In Canada we have multiple chains and they collude anyway
Australia is super concentrated, the duopoly own 70% of the grocery store market as well as others like 60% of the alcohol market. The rest is made up of convenience stores (mostly one company, IGA) and Aldi, the latter having single digit percent.
You basically sell and buy groceries though these two or you don’t exist. The CEO of one of them got so cocky during a recent interview he was forced to resign over it.
I guess we are pretty lucky over here in Germany then. We may have had some consolidation in the last few years, but there are still quite a few different grocery store companies competing.
The big ones are Aldi, Lidl, Rewe, Edeka, Netto, Penny and Norma. Quite a few of them own other supermarket chains as well, but those arent in my list.
Our supermarket market is so competitive that even companies like walmart failed to enter it (they also didnt do away with weird US customs, which probably didnt help).
I feel the UK does it fairly well. Every supermarket has its place.
Waitrose for the middle class.
M&S for the people who think they’re middle class.
Asda, Morrisons and Tesco for the masses.
Aldi and Lidl for the poor.
Heron Foods for the poor that can’t cook.
With the current extreme price gouging, seems like the perfect political cover to anti-trust the hell out of them and break them up.
You’d know the Libs would moan and get the Murdoch media to pump out the propaganda, but I think the Australian public would be on board. The tax cut reversal went over totally fine, because I guess on average people aren’t as stupid as the Libs would like.
(For international readers, the Liberal Party are the leaders of the conservative coalition, confusingly.
So rare.
Albertsons has been buying up competitors for a while.
https://en.m.wikipedia.org/wiki/Albertsons
Kroger has a few too:
https://en.m.wikipedia.org/wiki/Kroger#Chains
They turned Pavilions from a nice store to another dingy grocery. I can’t imagine this going through would be good for consumers. Many neighborhoods only have access to 2 stores at best, and I suspect most are already owned by the same parent. A merger would further turn this into a monopoly.
FTC is a captured agency with revolving door administration between what businesses they regulate and people responsible for regulation.
You’re not wrong, but the appointment of Lina Khan to head the FTC is easily one of the only good things Biden has done while in office.
So, at least she’ll go down kicking and screaming before they finally snuff her out, metaphorically speaking.
Honestly, i dislike his age, his stance on Israel and some other general things but overall I think Biden has accomplished a lot of good things as president.
Some examples:
- rejoined Paris Agreement
- rejoined WHO
- ends federal private prison contracts
- 130+ billion in student loan forgiveness
- Russia sanctions
- national registry for police fired for misconduct
- executive order protecting travel for abortion
- gas prices down (not all in his control but still)
- inflation reduction act
- Arguably the best post-pandemic economy in the world
Wait he did ALL that? I had absolutely 0 idea, it’s way more than I thought. Although I will add the one other thing I do know that he did:
- took major steps to removing medical debt from credit scores, including rolling out regulations prohibiting medical debt from being included on credit reports and creating standards for property owners to not consider medical debt for potential renters
Bad news sells. Good news goes unnoticed.
Hopefully… Biden appointed some real pussycats to the SEC who also died shit about fuck all…
Lina Khan has been extraordinarily ineffective at the head of the FTC.
While the agency has made a lot of noise about holding big tech accountable, all they’ve managed to accomplish is losing court cases and setting even more precedent against the government’s ability to enforce anti-monopoly legislation against these companies.
Her heart seems to be in the right place, but results matter as well.
Hell I’m in Seattle and my walkable area (about 2 mile radius for me) would be reduced to this mega corp, Amazon, and a couple Asian marts. I’ve got two corner stores nearby but their produce is usually not great and mostly they have snacks and microwavables. I suspect smaller towns or less bustling neighborhoods could easily be reduced to just this super chain and nowhere else
My 2nd closest grocery store is a 40 minute drive, and it’s a Walmart.
Bold of them to believe they’ll stop price gouging regardless.
My main takeaway from this article is that Walmart controls nearly twice the market share of Kroger and Albertsons combined - and needs to be broken up.
There should be automatic break ups of companies that take up too much of the market share.
A hard limit would have an effect, but companies would intentionally just barely hover under the limit. Maybe if it was a chace based thing proportional to their market share. Might be worth looking into.
Yep, that was the conclusion I came to as well.
Stop them building more stores at the very least.
Hmmm….
Kroger: 2,750 stores in 35 states and the District of Columbia
Albertsons: 2,273 stores in 34 states
Total: 5,023 stores. Presumably some would close due to proximity after the merger.Walmart: 5,214 stores in the 50 states, DC, and Puerto Rico
I smell a break up!!!
I’d love to see it but this isn’t the best comparison. The total number of stores aren’t what makes a company a monopoly, it’s the ratio of one company’s market share versus its competitors.
Fair point.
Luckily, digging through OP’s article, I have found the data!
Together, Kroger and Albertsons would control around 13% of the U.S. grocery market; Walmart controls 22%, according to J.P. Morgan analyst Ken Goldman.
That doesn’t matter as much as what is the local grocery shopping going to be like. I’ve never been to a Kroger (and only have been to an Albertsons via the Safeways they bought), so them controlling some percent of the market doesn’t say anything about the competitiveness of my local grocery market. Lots of people only live near a single grocery store brand, and that number would increase if those two merged.
Guess Kroger and Albertsons didn’t pay enough
Shittier services and higher prices/more fees, every merger ever.
Read yesterday about Wendy’s rolling out new electronic menus this year so they can enact dynamic pricing. Can’t wait until Surge pricing hits another non-negotiable like food.
Burn all these oligarchs down.
Yhgtbsm. Charge people more during a lunch rush because it’s convenient to do so. For fast food. Fuck them.
That’s stripping the “supply” out of “supply and demand” and just making it “demand pricing.”
They demand you pay more.
Didn’t Albertson’s already merge with Safeway?
They did, yes
People are talking about combining the names. If Albertson’s and Safeway didn’t, I suspect it will be the same with Kroger.
Best to keep the names separate to create the illusion of choice.
This has been silently happening in every industry for years.
Yep! This reminds me of the infographic where almost every major food brand in the world is covered by 10 parent brands. https://www.good.is/Business/food-brands-owners-rp
The Luxottica approach.
Started shopping for sunglasses about a week ago and learned about Luxottica. Turns out there’s a grand total of three brands of sunglasses that are viable for me to buy. Made in the USA but still only cost the same $300 that made in china Oakleys and ray bans cost.
I just ordered a pair of 20 dollar polarized sunglassess off amazon. Fuck the name brands and the ridiculous prices.
I’d still rather support American jobs and the American economy. I’m willing to pay for that and the quality is usually worth it IMO. If I can give my money to company that hasn’t outsourced jobs, I will.
I’m actually in Canada but there’s only two sunglasses manufacturers here and they’re both over priced high fashion stuff.
Illusion of choice
Safe Albert. Name writes itself. Gives people false sense of security even.
Safeson? Albertsway?
Capitalism, where a couple of fucking dudes can make or break a whole country.
And where being poorly suited for wielding that kind of power responsibly makes you more likely to be one of those fucking dudes.
FML, I hate that this is actually the case. God damn it.
Kroger has promised to invest $500 million to lower prices as soon as the deal closes.
Kroger made 1.8 billion last year after expenses, so investing 500 million is a good gesture of faith but, I think that it should be required to be repeated yearly if they wish to make it as a condition of the merger, 500 million while likely wouldn’t do much prices wise, wouldn’t even be helpful if they aren’t doing it past the first year anyway
It’s such a backwards way of doing it though. If they’re going to invest that much, that means they need to make a lot of money to cover for it, so they’ll have to keep prices where they are until they get the money, then they’ll make a show of spending it to lower prices, which really means they’re paying the salaries of business analysts who will come up with ideas. Once they’ve spent $500m coming up with ideas, their obligation will be fulfilled, and they won’t have to actually act on any of those price-lowering ideas.
Instead they could just make $500m less in revenue by directly lowering prices immediately.
But then they can’t brag about all the good money they spent and will instead whine about how hard up they are, so we’ll be stuck with high prices and no relief.
Surely this merger is different from all the other ones where corporations lied their asses off then jacked up prices after the merger went through, right?
I’ve got three grocery stores near my house. One is owned by Kroger and two by Albertsons. I hate to think what would happen if there were zero effective competition.
Same situation but we have two Kroger-owned (FM and QFC) and one Albertsons-owned (Safeway). The Safeway is right across the street from Fred Meyer, so the chances are they will shut Safeway down if the merger goes through. No point in competing with themselves. So we’re looking at fewer options, lost jobs, and higher prices. Wheee.
I hope the lawsuit is successful. This would make them the only viable store in many areas.
What if the only viable store would give you better deals than 2 competing ones?
Why would that ever even happen? What incentive does a business have to stifle its own profit margins?
If it was owned by the public, then the people could do the best they can with what they have instead of the least people are willing to accept while charging the most they’re willing to pay.
It’s why all the useful idiots are against nationalization of corporations. It removes private owners who exist just to siphon profits.
What will the new celebrity name be?
Krogertsons?
Albertger?
Grocer Monopoly
Walmart is already taken.
Absolutely. Walmart is there competition and always has been. I worked for Safeway back in the 2000s and they were always talking about Walmart.
Walmart will compete on some goods, but at least in my area they’re not really a grocery store. Their selection is much more limited. Some minimal poor quality produce, limited meats (nothing fresh), and few specialty items. You can go to a grocery store and get ingredients for most meals, but you can’t really do that with Walmart.
It’s a numbers game. Walmart has very low margins but immense volume. They compete but selling a product 1 cent less and driving the competition out.
Yeah, they can very much hurt the profitability of a grocery store, but they shouldn’t be counted as valid competition for anti-trust determination. If a region has a grocery store and a Walmart, the grocery store still has a monopoly on a lot of items.
Not even close. Albertsons and Kroger combined wouldn’t have as much marketshare as WalMart. (13% vs 22%).
Depends on where you live. It would be a 100% monopoly on groceries in various parts of the US where they reside. A monopoly doesn’t need to be national for it to be one.
Kralgertsons?
