Supermarkets massively filed for bankruptcy - ForumDaily
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Supermarkets massively filed for bankruptcy

Regional networks file for bankruptcy. Shops of low prices, originally from Europe, are expanding, forcing competitors to keep prices low.

Kroger Co. and Walmart Inc., the two largest grocers in the US, are investing in technology and expanding delivery, trying to compete Amazon.com Inc.

The forecast for retailers is bleak. The historical attack of food price deflation that triggered a price war in the last two years has ended, but there is growing competition to sell more products on the Internet. All these changes are not in favor of some well-known brands.

Southeastern grocers, owners of supermarket chains Winn-Dixie and Bi-Lo, filed for bankruptcy last week.

At the moment Amazon represents a rather symbolic threat. Last year, the company acquired Whole Foodsbut it provided her with less 500 stores. Meanwhile, the e-commerce product delivery company still holds a small percentage of the grocery market.

Investors at a loss

Despite this, the expansion Amazon contributed to the fact that traditional stores began to invest in costly progress, and investor concerns affected stock prices. This year Kroger and Walmart lost over 30 billions in market value.

But grocery giants at least have the scale and resources necessary to adapt. Smaller players in this industry are even more at risk.

Together with Southeastern Grocers, Tops Friendly Markets also filed for bankruptcy last month. Based in Williamsville, NY, Tops has about 170 stores.

Meanwhile Southeastern grocers around xnumx stores. The company announced a reorganization on Thursday, with further plans to close the 700 store.

According to Roger Davidson, an industry consultant, as pressure increases among competitors, other regional networks may suffer the most.

Even before Amazon bought Whole Foods Last year, pressure increased in the food industry. In recent years, food has begun to appear in dollar stores and pharmacies.

German rivals

Of course, some chains still open new stores, first of all it concerns Aldi and Lidl. According to a research firm Planned grocery, the share of two long-standing German competitors accounts for 27% of grocery stores recently built or those that are under development.

Lidl is a newcomer to the United States, but research has shown that he forces competitors to lower prices in markets where he opens stores.

Aldi operates in the US since 1976, and now has more 1750 stores. He spends more than 5 billions of dollars to renovate existing stores and build additional 1300 offices over the next five years.

According to Jason Hart, remodeling involves increasing the space for selling natural and organic items, which is part of the bid for richer buyers. Over the past 3 of the year, sales of the company's organic products have grown by more than 200%.

Slow growth

Competitive pressure continues to grow, as the food industry has only achieved about 2% growth over the past five years, the report says Forrester Research Inc. This means that at present the industry is mainly fighting for its market share.

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