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Shaw's and Star Market

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Shaw's and Star Market
Company typeAlbertsons LLC
IndustryRetail (Grocery)
Founded1860 (Portland, Maine)[1]
HeadquartersWest Bridgewater, Massachusetts
Number of locations
169
Key people
Robert Miller, CEO
ProductsBakery, dairy, deli, floral, frozen foods, grocery, liquor, meat, pharmacy, produce, seafood, snacks, sushi
Websiteshaws.com

Shaw's and Star Market are two American grocery store chains based in West Bridgewater, Massachusetts, employing about 30,000 associates in 169 stores. The company offers products under its private labels, including those by Richelieu Foods.[2] Star Market is a companion store to Shaw's, having been purchased the competing chain in 2004.

Shaw's and Star Market are wholly owned subsidiaries of the Boise, Idaho–based Albertsons LLC. The combined chain has the largest base of stores that operate in Ne w England, but is the third-largest behind Quincy, Massachusetts-based Stop & Shop and Scarborough, Maine-based Hannaford Bros. Co.; Hannaford operates stores in New York while Stop & Shop's operation extend into New Jersey, but Shaw's does business strictly in its core area.

Until 2010, Shaw's operated stores in all six New England states; as of 2011 Shaw's remains the only supermarket chain with stores in five of the six after it sold its Connecticut operations.

Shaw's was acquired by Albertsons in 2004, which acquired the chain from J Sainsbury plc for $2.5 billion. In 1999, Shaw's acquired the Star Market chain. Star Market had been owned by Investcorp, which in turn purchased the chain from American Stores in 1994. American Stores had acquired Star Market through its hostile takeover of Jewel Companies, Inc. in 1984. Jewel acquired Star Market in 1964.

Shaw's operates 156 stores in Maine, Massachusetts, New Hampshire, Rhode Island, and Vermont, while Star Market operates 13 stores in Massachusetts. Shaw's has an advantage over its competitors as its core area includes Greater Boston, Manchester, New Hampshire, Burlington, Vermont, and Portland, Maine; and resort areas (Cape Cod, the mid-coast of Maine, and Vermont's ski towns.) The chain's largest competitors are Hannaford, Market Basket, and Stop & Shop.

In November 2012, Shaw's and its then-parent company, SuperValu, announced that Shaw's would lay off 700 employees in an effort to re-group and end financial losses. It also disclosed it had been looking for a buyer.[3]

In January 2013, Cerberus Capital Management announced a deal to acquire 877 stores in the Albertson's, Acme, Jewel-Osco, and Shaw's and Star Market chains from SuperValu for $100 million and acquisition of $3.2 billion on SuperValu debt.[4] The deal closed on March 21, 2013.

History

Beginning

In 1860, George C. Shaw opened a small teashop in Portland, Maine. Meanwhile, Maynard A. Davis established a group of small downtown grocery stores in Brockton and New Bedford, Massachusetts, called Brockton Public Market (BPM.) In 1919, Davis purchased the George C. Shaw Company and made it a subsidiary of BPM.

Expansion

A Shaw's (and former Star Market) over the Massachusetts Turnpike in Newton

As George C. Shaw and BPM continued to grow, it was decided that a central warehouse would be needed for the two companies. In 1961, a warehouse in Brockton was purchased.

By 1965, George C. Shaw had begun to expand northward, into New Hampshire. This expansion, combined with BPM's growth in southern Massachusetts, moved the companies to build a distribution center in 1972 in East Bridgewater, Massachusetts. In the 1980s, a warehouse was built in Wells, Maine, and in January 1991, Shaw's opened a distribution facility for perishable food items in Methuen, Massachusetts.

In 1978, BPM stores in Massachusetts became Shaw's Supermarkets, Inc. to maximize advertising. It was the first step towards merging the two companies.

In November 1983, J Sainsbury plc, then the UK's largest supermarket group, purchased 21% of Shaw's outstanding stock. In June 1987, Sainsbury's acquired controlling interest.

Acquisitions

J Sainsbury plc acquired stores from four New England food retailers: Iandoli's (1987), Cerretani's (1993), Star Market (1999) and Butson's (2003).

In 1995, Shaw's entered Connecticut, opening five stores. The next year, Sainsbury purchased 12 former Edwards supermarkets and two future sites from Royal Ahold.

The largest supermarket chain to join the Shaw's family is Star Market. This acquisition strengthened Shaw's position as the second-largest supermarket company in New England. Like Shaw's, the Star Market Company had humble beginnings, and many "firsts" in the supermarket industry. Star was the first New England supermarket to have air-conditioned stores, the touch method of ringing registers, in-store check verification, refrigerated cooked foods, self-service wrapped meats, and packaged produce.

Distribution Center Closings

In November 1999, J Sainsbury/Shaw's Supermarkets closed the Star Market Distribution Center in Norwood, laying off over 300 Local 25 Teamster members. In May 1999 Local 25 agreed to a 6-month extension with J. Sainsbury/Shaw's Supermarkets on the then contract to bargain in "good faith".[5] In 2001, J.Sainsbury/Shaw's Supermarkets closed the Shaw's Distribution Center in East Bridgewater, laying off over 400 UFCW members. J.Sainsbury/Shaw's Supermarkets indicated that the warehouse was "not centrally located in its service area, and the necessary physical expansion is impossible".[6] C&S Wholesale Grocers does the majority of the work that was performed by the two union-based distribution centers. C&S's distribution center/headquarters were in Brattleboro, Vermont at the time.

Albertsons and SuperValu

In 2004, J Sainsbury sold Shaw's to Albertsons for US$2.48 billion. On June 2, 2006, a partnership of SuperValu, CVS Corporation and several investment firms including Cerberus Capital acquired Albertsons with the intent to divvy up the parts. SuperValu received what was generally thought of as the best-performing assets, including Shaw's and Star Market, along with regional chains including Acme Markets (Philadelphia); Jewel, and Jewel-Osco (Chicago). However, Shaw's has been beset by store closings almost yearly since its acquisition by Supervalu.[citation needed] At its 2006 peak, Shaw's operated more than 200 stores in New England,[citation needed]; however, Shaw's footprint has been reduced except in Vermont, and has pulled out of Connecticut altogether.

The first round of closings was announced in late August 2006, when Shaw's announced it would be closing six in October. These stores were in New Britain, Southington, and Bridgeport, Connecticut; and in Worcester and New Bedford, Massachusetts.[7][8][9] In September 2007, Shaw's closed its stores in Providence and Pawtucket, Rhode Island; and Waterbury, Connecticut, because of poor sales. The closings left Shaw's with 204 stores. A total of 224 workers were laid off or transferred.

On July 25, 2009, Shaw's closed its Bristol and Shelton, Connecticut stores.[10] In early 2009, Shaw's had closed stores in Gorham, New Hampshire, and Bangor, Maine. The largest round of closings was in 2010; Shaw's announced in February that it would sell or close its 18 Connecticut stores. Eleven of those were sold to New Jersey-based Wakefern, operator of ShopRite and PriceRite supermarkets; and 5 to Stop & Shop.[11] The other two never found a buyer, though one will be subdivided for a Supervalu-owned Save-A-Lot.[12] In addition to the store closures, in late March 2010, Shaw's eliminated about 4% of its full-time workforce, which amounted to nearly 650 jobs spread out over the about 120 non-union stores.

A recent round of closings was in early 2011; on January 5, Shaw's announced that three Massachusetts and two Rhode Island stores that were unprofitable would close by February 17.[13] After the closures, Shaw's was left with 169 stores.[citation needed]

Store Count

According to their website, as of December 2009, Shaw's operated 194 stores: 12 in Rhode Island, 18 in Connecticut, 19 in Vermont, 22 in Maine, 34 in New Hampshire, and 89 in Massachusetts (including 12 operating as Star Market). Including the 2011 closings, there are only 10 stores in Rhode Island and 84 in Massachusetts, leaving 169 stores as of February 2011.

Shaw's' current[when?] store footprint extends (south to north) from the coastal town of Westerly, Rhode Island to the Canadian border in Derby, Vermont. Shaw's strongest presences are in Greater Boston (where its largest competitor is Stop & Shop) and throughout New Hampshire and Vermont (where its largest competitor is Hannaford).

Despite the closings, Supervalu has remodeled and updated many Shaw's stores. In late 2010, Supervalu introduced a newly redesigned website for Shaw's; the website design is shared with sister stores Cub Foods and Jewel-Osco. Shaw's has also increased their marketing efforts, partnering with the New England Patriots and the Boston Red Sox Radio Network as their "official supermarket," airing advertisements frequently on New England radio stations, and maintaining a Facebook page with more than 69,000 fans.

Osco Drug

Main article: Osco Drug

Before it was acquired by Shaw's, Star Market Company had been part of Jewel Companies, and while Jewel owned Star it built many combination food-drug stores branded as "Star-Osco," with common checkstands but separate management teams. While it owned Star, Jewel also built many stand-alone Osco Drug stores in New England. After Jewel was acquired by American Stores in 1984, the Star-Osco stores were re-launched as Star Markets, and placed under a single management team. In 1999, Albertsons acquired American Stores, and in 2001, Albertsons sold its 80 New England Osco Drug locations to Jean Coutu group, which added them to its Brooks Pharmacy group. When American Stores sold Star Markets in 1994 to Investcorp, the Osco connection was ended, or so it seemed. When Albertsons bought Sainsbury's American supermarket assets in 2004, including Star Markets, Star and Osco were reunited under one corporate umbrella. By 2005, the signs on the front of all of Albertsons-owned grocery stores with in-store pharmacies were changed, adding either "Osco" or "Sav-On" to the stores' logos, to emphasize the one-stop shopping available inside. The drug store name chosen reflected which of Albertsons' drug chains operated in the specific marketing area. Because New England had previously been an Osco market area, the Shaw's and Star Markets with pharmacies were renamed "Shaw's-Osco" and "Star-Osco." Today,[when?] nearly 60 Shaw's and Star Market stores operate an Osco Pharmacy within.

Brands

Shaw's Star Market has gradually acquired brands, including:[citation needed]

  • Osco Drug
  • Shoppers Value
  • Home Life
  • Market Fresh
  • Culinary Circle

Supervalu announced in May 2011, that its national brand equivalent products (including Shaw's) would be renamed "Essential Everyday" in line with its plans to phase out own-brand products carrying the names of its banners nationwide.[14]

References

The Shaw's Supermarket's history comes from the most recent version of the Shaw's Associate Handbook.[citation needed]

  1. ^ "About Shaw's". SuperValu. Retrieved 8 March 2012.
  2. ^ van der Pool, Lisa (23 February 2009). "There's new appetite for peddlers of cheap eats". Boston Business Journal. Retrieved 8 March 2012.
  3. ^ Bray, Hiawatha, "Shaw’s says it’s laying off 700", The Boston Globe, November 3, 2012
  4. ^ "Supervalu to sell 5 grocery chains, including Albertson's, Jewel-Osco, to Cerebus-led group". The Washington Post. January 10, 2013. Retrieved January 10, 2013.
  5. ^ "J. Sainsbury to close Bay State warehouse". Boston Business Journal. 1999-09-15. Retrieved 2008-07-17.
  6. ^ Chris Reidy (2001-07-11). "Shaw Supermarket's to eliminate 335 warehouse jobs". Retrieved 2008-07-17.
  7. ^ Jason Pheasant (2006-09-02). "Shaw's to shutter local stores". New Britain Herald. Retrieved 2008-07-17.
  8. ^ Bob Kievra (2006-09-14). "Shaw's to shutter Worcester store; Grafton Street market missed targets". Worcester Telegram & Gazette. Retrieved 2008-07-17.
  9. ^ Curt Brown (2006-09-01). "Shaw's closing South End store in October". The Standard-Times. Retrieved 2008-07-17.
  10. ^ Staff (2009-06-26). "Shaw's to close Bristol store". The Bristol Press. Retrieved 2009-12-14.
  11. ^ Raus, Amanda, "Shaw's Closing Up Shop", NBC Connecticut, Saturday, Feb 13, 2010
  12. ^ Save-A-Lot Discount Grocery Stores To Open In Former Shaw's Store in Manchester and in Waterbury, The Hartford Courant, December 3, 2010
  13. ^ Shaw's to close 5 stores, including 3 in Mass., The Boston Globe, January 5, 2011.
  14. ^ Supervalu Launching New Private Label, Supermarket News, May 3, 2011


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