In an exclusive interview with Food Dive, AholdDelhaizeCEO Dick Boer seemed to downplay the possibility that the grocery giant is contemplating a bid for beleaguered Kroger, which has beenhit particularly hard by changing consumer buying habitsand the recent$14.7 billion purchase of Whole Foodsby online heavyweight Amazon.
AholdDelhaizeitself is theproduct of a 2016 mergerthat brought the Stop & Shop, Giant and Food Lion banners into the same company. The merger combined two big supermarket chains that together have more than 2,000 stores in the U.S., with many of those locations on the East Coast. The grocer is about halfway through integrating the two companies.
“We are just starting to integrate the companies here on the U.S. side. We have our hands full to work on what we have to do today,” Boer said about his company's interest in buying another grocer. “Today, we need to focus ourselves on delivering the synergies, the value out of this deal and that’s important for us.”
当被追问是否looking for another acquisition, he chuckled: "If I would do it, I wouldn't tell it to you."
But Boer left the door open to another deal. “We, of course, are always looking aroundto see what is happening,” he said. "There is always speculation. I leave the speculation to the people who speculate."
The Cincinnati Business Courier reported earlier this month thatKroger may be in talks with AholdDelhaizeover a potential merger。The speculation stems from an analyst’s report that Ahold may have hired advisors to help explore a possible bid for Kroger. A tie-up between AholdDelhaizeand Kroger, owner of its namesake brand as well as grocers Harris Teeter and Ralphs, would give the combined company greater scale and buying power.
Traditional supermarket chains have been battered by the raft of competitive challenges posed by Walmart, discounters Aldi and Lidl, as well as Amazon-Whole Foods. This year alone, Kroger’s stock is down about 40% while AholdDelhaizehas declined 8%.
“The store itself will be an element of abundance and price and choice. I think that is difficult to do online in food."
Dick Boer
CEO, Ahold Delhaize
During the interview, Boer also downplayed the dire predictions that have cast a pall upon traditional brick-and-mortar grocers. While hedidn’t discount the role that services such as online grocery and click-and-collect will play in delivering food to consumers going forward, the chief executive said supermarkets offer shoppers a slew of benefits not found in these other alternatives.
“I think it’s a little bit of an overreaction. Grocery stores have been there for a long period of time ... and they have a role to play,” Boer said. “The store itself will be an element of abundance and price and choice. I think that is difficult to do online in food.”
Brick-and-mortar stores have more quality, selection and freshness — factors that are especially valuable as the public increases its consumption of fresh, natural and organic food. In the case of AholdDelhaize, the grocer offers a range of solutions that consumers can choose from, ranging from ready-to-eat prepared meals andhome delivery in its Peapod unitto takeout food andingredientsthat can be used at home.
“It’s still difficult to get online the smell, the taste … I think that’s important for a lot of customers at the end of the day,” Boer said. “There is also therelationshipand the store and the people —don'tforget that. How do you get communityengagement在线吗?你不能。”
定价pressure continues to plague retailers despite recent reports that food deflation is showing signs of improvement — giving grocers the opportunity to pass on higher prices to consumers.
"It's an industry that is always about price. We always know that so we need some inflation back in the market."
Dick Boer
CEO, Ahold Delhaize
The U.S. Department of Agriculture expectssupermarket prices to changebetween -0.25% and +0.75% in 2017. However, poultry, seafood and dairy prices are expected to rise this year compared with declines in 2016, according to the USDA.
“It's an industry that is always about price. We always know that so we need some inflation back in the market ... we see it now in the second quarter now coming back and that’s good news,” Boer said. “We have a bit more space tomaneuverfor everyone.”
Still, he said the discussion on price shows no sign of changing: "If you look at the promos, the campaigns everybody has — it's all about sales, sales, sales,"
