Market Basket suitor circling
Now that Delhaize, the parent company of Hannaford Bros., has waded into the Market Basket controversy as a bidder for part or all of the supermarket chain, some shoppers wonder if the end is coming for lower-priced groceries in New England.
But Delhaize, which has refused to comment on its plans or even confirm that the company is a bidder for Market Basket, is also in the discount grocery business. In addition to Hannaford Bros. and Food Lion, Delhaize operates Bottom Dollar Food, a discount grocery chain with 49 stores in Pennsylvania, Ohio and New Jersey.
Bottom Dollar Food is said to be similar to other discount grocers such as Aldi and Save-A-Lot. Shoppers pick both national and private brand items from no-frill displays and pack their own purchases in bags brought from home or bought at the checkout counter.
John Dumais, president and CEO of the New Hampshire Grocers Association, which represents the state’s retail food industry and its suppliers, has said the best solution for Market Basket would be for the chain to go back to the way it was.
“It was a great model,” said Dumais, who added that Market Basket could bounce back quickly if ousted CEO Arthur T. Demoulas was reinstated.
“There’s no question it could return and be right on track,” he said. “They had loyal employees and loyal customers.”
But Dumais also felt that Market Basket could continue under a new model. Although many consumers have said Market Basket’s main draw is its lower prices, Dumais has said a chain such as Hannaford also has characteristics that appeal to shoppers. “It’s not always about the price,” said Dumais. “Quality, convenience and things like a fresh bakery, those are all important to many customers.”
And the fact that Hannaford is familiar to local shoppers and known for treating its associates well also plays in its favor, Dumais added.
Dumais did say that the success of another chain taking over Market Basket could depend of the location of the stores.
“If a bidder has existing stores next to Market Basket, they will cannibalize each other,” he said.
Dumais, who ran his own neighborhood grocery store in Franklin years ago, said the highly-competitive grocery industry, works on very small profit margins, and is sensitive to a wide variety of factors.
“A slight change in anything can have a dramatic effect,” he said adding that success is tied to the benefits stores are able to provide to shoppers.
“The best thing for the industry is when the consumer is satisfied and the employees are satisfied,” he said.