Two very large grocery store chains are discussing a merger? My antenna goes up when I hear about proposed mergers. I mean it must be tough in the food business these days when large general grocers without a niche market, companies like Kroger and Albertson’s begin to discuss a merger. These two are not necessarily known for having “Whole Foods”, they just carry foods you really eat? They’re not in the deep discounter category either like a Walmart. The grocery store business is probably much different than it was back in the day, as several new players entered this staple business and it appears to be taking its toll. General retailers and specialty stores have entered this market, retailers like Tar-gay, Amazon, Costco, and Walmart are big in supplying groceries now. Plus, many people today shop online and request delivery for their grocery needs, never even entering a store. I myself, I like to pick out my own produce by hand, and steaks, ribs, fish, chicken wings, eggs, etc. I don’t know if I would trust a store employee to do that for me. That’s not to say that they wouldn’t get it right, but why go there when I can take 45 minutes out of my day to grocery shop every week or two, I don’t really mind.

What should they name the merged chain? How about welcome to “Bert-Krogee’s-Son, Al”? 🙂 Or maybe do kind of an H.E.B. concept, and use only initials for the newly combined company, they can call themselves “A.K.’s Food & Stuff” now. That has a nice ring to it!

I’m interpreting this latest move to signal that the grocery business has become very mature in the United States with the entry of all these new players over the past two decades. Thus growing traffic and increasing profits must be difficult to accomplish for the crowded field. That’s my interpretation for what we see taking place here. Simply put, there are too many players “on the field” and some of the weaker links will be weeded out, especially considering the U.S. is experiencing annual inflation growing at between 10 and 30%, just in the foods category!