Supermarket Wars: Haggen vs. Albertsons Part Two

September 03, 2015

Will this drama have shoppers scurrying to other retail outlets to buy their foods?

This is getting interesting; and it appears that the folks at Haggen may be reading a bootleg copy of Donald Trump’s Presidential Run Playbook. Disparage, make claims that open eyes wide and throw the “billion dollars” in everyone’s face.

Let’s be clear. We do not know if the claims being made by Haggen in the federal lawsuit they have filed against Albertsons on Tuesday September 1st are factual or true, nor do we know if Albertson’s one sentence comment that the allegations in the lawsuit are completely without merit is either. 

What we do know is that these are very serious charges that will hurt both of these chains and will undermine confidence in supermarkets from shoppers.

This war will be played out in the headlines, and it will stretch far beyond the West Coast much as the Whole Foods overcharging investigation in New York City received national coverage. It does not help the chains that the United Food and Commercial Workers Local 770 of Los Angeles is accusing them of fraud, misrepresentation and contract violation in their own lawsuit – and expect to see placard carrying disgruntled ex-workers in parking lots, in front of stores and in the news. And we have seen in Southern California many times shoppers won’t pass picket lines for groceries and while this may have minor impact on Haggen’s already dismal store traffic it could well leaving long term damage to both Albertsons and Vons. 

The Haggen lawsuit cites that Albertsons put expired items on shelves for sale and failed to perform routine maintenance creating unsafe food safety conditions – both actions, again if true, are major concerns for shoppers. We are used to “corporate takeover dramas” but when actions may have an affect on shoppers’ health and wellness the rules change dramatically. When it comes to inflating prices or the concern about shoppers’ confidential information being wrongly used, Americans have little patience these days. Cause for industry alarm should be the lawsuit citation that states that Albertsons gave Haggen misleading and incomplete retail price data, causing it to inflate retail prices – once again calling into question in shoppers minds just how retail pricing (and profits) are determined and whether price fixing is the standard operating policy of our industry. 

This drama as it continues will have shoppers scurrying to other retail outlets to buy their foods and will fuel the growth of the Amazon Fresh and InstaCarts of the West Coast where there is more transparency and trust through our mobile devices.