Washington Grocer Buying Out Albertsons, Vons

(December 26) Haggen Food & Pharmacy has moved to acquire a number of Albertsons and Safeway stores in Southern California, including at least three on thee west end of San Bernardino County.
In recent years, Albertsons has fallen into a vicious spiral, raising prices and thereby driving away customers, which has led to further raising of prices. Leaner and hungrier competitors such as El Super, Cardenas, Ranch King, WinCo and Food For Less have picked up business in the meantime.
Haggen Food & Pharmacy now operates exclusively in the Pacific Northwest. This week, however, it announced it has made arrangements to acquire Albertsons and Safeway stores in Washington, Oregon, Nevada, Arizona and California. Haggen will eventually take over 146 Albertsons and Safeway stores, 83 of them in California.
The transition will come in stages. During the initial stage, which will come about in 2015, the Vons in Chino Hills at 4200 Chino Hills Parkway, the Albertsons in Rancho Cucamonga at 8850 Foothill Boulevard and the Albertsons in Upland at 1910 N. Campus Avenue will become Haggen Food & Pharmacies. Safeway currently runs Vons stores.
The Haggen chain was founded at the height of the Depression in 1933 by Ben Haggen, Dorothy Haggen and Dorothy’s brother Doug Clark in Bellingham, Washington. Haggen has grown to become Washington’s sixth largest company, operating 18 stores in Washington and Oregon and employing 2,000. Haggen operates 16 pharmacies and will pick up 106 more.
Through the Alberstons-Safeway deal, Haggen will increase its market share eight times. The company’s payroll will grow to 10,000 by the completion of the takeover deal.
According to Haggen, it is committed to supporting local farms, slaughterhouses and other food and product sources.
Haggen’s pricing is roughly in line with that offered by Safeway. .
Haggen is closely associated with another Washington-based company, Starbucks, becoming, in 1989, the first grocery store chain to include in-house Starbucks.
Haggen has engaged in some innovative marketing schemes in the past, such as operating 24 hours per day beginning in 1984. It abandoned that angle at most locations in 2010.
Haggen stores feature a bakery, deli and butcher.
The company had grown to 31 stores with revenue of $884 million in 2008, but was blindsided by the economic downturn, seeing its revenue dip by $144 million the next year. Weakened by trying to keep its entire operation intact, the Haggen family in 2011 lost majority ownership of their stores to a private investment firm, Comvest Partners.
Convest then embarked on a three-year conflation plan, closing thirteen of the company’s poorest performing stores.

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