Missing cold cuts from some Krogers may signal a new era for Kroger as its new CEO vows to push for lower prices.
Kroger CEO Greg Foran told Wall Street analysts he’s pushing back against suppliers “using inflation” to boost their sales when customers were clearly "under pressure."
On a Sept. 11 conference call with investors, Foran stressed that cash-strapped shoppers meant he had to work harder to keep prices in check and look for ways to lower them. A big part of that is working with food company vendors.
Though he didn’t name any national grocery suppliers by name, Foran’s comments came as Kroger appears to be having difficulty in Cincinnatiwith at least one: Florida-basedBoar’s Head, which makes delicatessen products including ham, turkey
and cheese.
Kroger CEO mum on local Boar's Head disruption
On Sept. 10, Kroger confirmed three larger-format Marketplace stores in Greater Cincinnati had run out of Boar’s Head products and hadn’t restocked them, and some local stores acknowledged they were carrying less of the premium-priced deli products that frequently cost more than $10 a pound.
Neither Kroger nor Boar’s Head commented on the service disruption, but some industry experts said it might be due to a pricing dispute. Boar’s Head said they continue to stock other retailers in the region, such asPublix, Fresh Thymeand Jungle Jim’s.
Affected Kroger stores have filled vacant cooler space with the company’s premium Private Selection branded items. During the call, Foran even mentioned store deli sales were a bright spot, boosted by an increase in rotisserie chicken sales during the dinner hour and new sushi products.
Foran will push house brands at Kroger
On his call, Foran added that, due to customer demand for more lower-priced products, Kroger was expanding its Smart Way value-oriented house brand from about 130 items to 1,000 in the next year.
Foran also said if Kroger can’t get acceptable prices from branded suppliers, it will sell more house-branded products instead.
“What we don't want to get in is a situation where people can just turn upand put prices up and not have full justification for that sort of increase. I'm not in the game of using inflation as a way of generating extra sales,” Foran said.
A former Walmartexecutive, Foran has pledged to lower prices in his bid to reboot Kroger'ssales growth.
Kroger is the nation's largest traditional supermarket chain
With $147.6 billion in annual sales, Kroger operates nearly 2,700 stores in 35 states and the District of Columbia, including 77 in Greater Cincinnati. The company employs 403,000 workers, including nearly 20,000 in the Greater Cincinnati region.
The retailer operates stores under the Kroger banner name as well as Fred Meyer, Ralphs, Harris Teeter, Pick ‘n Save, Dillons, King Soopers, Mariano’s, Fry’s, QFC and others.
This article originally appeared on Cincinnati Enquirer: Amid Boar's Head flap, Kroger CEO resists suppliers 'using inflation'
