Grocery Wars Turn Small Chains Into Battlefield Casualties
This month, Fairway executives met with the company’s roughly 3,500 workers, most of whom are
unionized, to unveil a set of new initiatives — like investments in a new marketing campaign.
Like businesses in other industries — including Toys “R” Us, which announced liquidation plans this month —
many failing supermarkets are owned by private equity firms that have loaded the companies up with debt.
This month, the parent company of the Southern stores Winn-Dixie
and Bi-Lo said it would file for Chapter 11 protection by the end of the month, and close 94 stores.
The company filed for bankruptcy protection last month, another casualty in a grocery war
that is raging across the country, from tiny mountainous hamlets like Chestertown to the gentrified enclaves of Brooklyn and Los Angeles.
The private equity firm Lone Star has cashed out $980 million in dividends from
Winn-Dixie’s parent company since 2011, according to Moody’s Investors Service.
“The private equity owners try to drain every last ounce of blood from these
companies,” said John T. Niccollai, president of Local 464A of the U. F.C.
Membership in United Food and Commercial Workers, the largest grocery union, has dropped
more than 9 percent since 2002, to about 1.2 million, according to the Labor Department.
