Publix Buys Food City
ky store

London, KY

#141 Aug 22, 2009
Where is Captain America, Florida Southern, Or Without Blinders On have you guys dissappeared. It is down to the final day of this. What is new if anything?
Without Blinders On

Nashville, TN

#142 Aug 22, 2009
No it's not.... People were saying the race would be the point of announcement... Very seldom do annoucements of this magnitude come at events. The event overshadows the "bang"...
Captain America

Maryville, TN

#143 Aug 22, 2009
I think its kind of funny how everyone thinks the big bad Publix can devastate everyone who competes with them. We'll see what happens.
eastgatenole

Tallahassee, FL

#144 Aug 22, 2009
Milton Drew wrote:
CA,
Thanks for the info. I've put less credence in the rumor since the Pilot/FC announcement a couple of days ago.
There isn't a more crafty businessman than Jim Haslem of Pilot Corp. I guarantee you, if there's one man who knows if anything is going on between FC and Publix it would be Haslem. I just can't see him entering into a multi-million dollar agreement with a company that's about to be sold.
Here's an interesting tidbit: Bill Haslam, the son of Pilot founder James Haslam, is the mayor of Knoxville (and is running for governor in the next election): http://en.wikipedia.org/wiki/Bill_Haslam

Not exactly sure what to make of this, but it would seem to delegitimate, to an extent, the argument that the Publix/Food City rumor is not true SIMPLY because of the recent FC/Pilot deal.

I find it VERY interesting that Publix has been in TN now for SEVEN years and still has not purchased ONE site for a potential store in Knoxville, a metropolitan area with a total population of at least HALF A MILLION PEOPLE: http://en.wikipedia.org/wiki/knoxville

This fact alone--along with the fact that Publix now is a VERY well known and respected name in TN based almost exclusively on the stores that the company has opened in and around Nashville--means, among other things:

1) There is a fairly good-sized pool of Publix-trained associates who could now populate new stores as management and still not sacrifice quality leadership in the name of "quick results" and overly hasty promotions of people who aren't ready to lead and/or don't know how to do business the Publix way.

2) Publix is planning an all-out assault on the Knoxville market: they will NOT open one or two stores, built from scratch, as the first and only presence in the new market, and wait for these to "catch on" enough to justify building more. I anticipate somewhere between 5 and 10 stores, some of which I expect to be conversions and some new construction.

Think about how ODD it is that, after seven years in the state, there is not even ONE building permit, land purchase, or even publicly identified site for a Knoxville store--especially since, in addition to the already mentioned large population of the metro area, Knoxville has a large public university, which means a large labor pool from which to choose.

Finally, Knoxville is actually a few miles closer to the Atlanta distribution center than Nashville is:
http://www.indo.com/cgi-bin/dist...

Now of course it made TREMENDOUS sense for Publix to enter TN in Nashville, given the fact that only Memphis (which is hopelessly remote from our reach at the present time) has a larger population. However, given all the factors that I've identified, I expect the other shoe to drop and Publix to enter the 3rd largest metro area in the state with a rapid bang and very soon...
Milton Drew

Fort Campbell, TN

#145 Aug 22, 2009
I don't get the connection between Bill Haslem running for Governor and the FC/Pilot deal. If anything it would seem to strengthen the ties between the two companies since Bill Haslem is a principal owner of the Knoxville Smokies baseball club and Food City is one of that team's top promoters.
jefferson city

United States

#146 Aug 22, 2009
Florida Southern wrote:
We do carry lobster tanks in our stores but we do not put Publix letterhead on them, there are in a gray formica cabinet so this is a rumor !!!
I meant that the invoice had Publix letterhead, not food city's letterhead. Not on the actual tank.
Florida Southern

AOL

#147 Aug 22, 2009
Soon fellows, very soon !!!!!!!!!!
KY store

London, KY

#148 Aug 22, 2009
Florida Southern Do you know it has been a done deal? Is FC sold to Publix? If so when will it be annouced?
eastgatenole

Tallahassee, FL

#149 Aug 22, 2009
I, for one, cannot imagine Publix having much interest in many of the smalltown stores that FC has...
KY store

London, KY

#150 Aug 22, 2009
Eastgatenole that may be true they dont want smalltown stores but if they buy fc they will have to buy them all.
TNFC

Elizabethtown, KY

#151 Aug 23, 2009
If they were waiting for the race to conclude before making an announcement, it would likely be during the following week or perhaps the next. I'm not really looking for it though.

As for the lobster tank, I highly doubt that the invoice with the Publix logo exists. Not at the store at least. Any invoice would probably have been sent to K-VA-T rather than to the store directly. The tank likely would only have arrived with a packing list and I doubt that they would have allowed it to arrive with a paper showing a Publix logo if the buyout were true. Especially with as quiet as they would want it to be kept.

I think a buyout is the only way Publix can move into the East TN area with confidence. According to SuperMarket News magazine, Food City is ranked 3rd in overall grocery marketshare in TN. That is behind #1 Wal-Mart and #2 Kroger. This is pretty significant considering both Wal-Mart and Kroger operate state-wide and Food City only operates in maybe a quarter of the state. It will be a tough area for any newcomer to move into and simply building stores (whether 1 or 10) will only serve to divide the existing market share into smaller pieces. That's not particularly advantageous.
KY store

London, KY

#152 Aug 23, 2009
For everyone that spread the rumor that Food City was selling out to Publix, its not true. The race is over so now you will have to talk about something else.FC is not for sale like Mr. Smith said we all should have just believed that and let it be done with. Guys start another rumor about something else.
eastgatenole

Tallahassee, FL

#153 Aug 23, 2009
TNFC wrote:
If they were waiting for the race to conclude before making an announcement, it would likely be during the following week or perhaps the next. I'm not really looking for it though.
As for the lobster tank, I highly doubt that the invoice with the Publix logo exists. Not at the store at least. Any invoice would probably have been sent to K-VA-T rather than to the store directly. The tank likely would only have arrived with a packing list and I doubt that they would have allowed it to arrive with a paper showing a Publix logo if the buyout were true. Especially with as quiet as they would want it to be kept.
I think a buyout is the only way Publix can move into the East TN area with confidence. According to SuperMarket News magazine, Food City is ranked 3rd in overall grocery marketshare in TN. That is behind #1 Wal-Mart and #2 Kroger. This is pretty significant considering both Wal-Mart and Kroger operate state-wide and Food City only operates in maybe a quarter of the state. It will be a tough area for any newcomer to move into and simply building stores (whether 1 or 10) will only serve to divide the existing market share into smaller pieces. That's not particularly advantageous.
I tend to agree fully with your last paragraph: moving into a market where this is an existing store that is ANYWHERE close to Publix' quality makes little sense. This is why, in my view, we have not pushed harder to enter NC and VA: Harris Teeter stores are quite nice and are ESTABLISHED.

Perhaps the smarter move for Publix would be to go WEST and enter the HUGE Memphis market, where we could beat Kroger into submission (as usual)...
Tn Express

AOL

#154 Aug 23, 2009
Eastgatenole, thanks for the informatve web-sites. Take it from a person who has dealt with Publix from the very first store in Nashville, some 7 years ago. Both Kroger and Publix and any other "Big Dog" in the business hold the right to land deals all over Knoxville and Middle Tennessee. I know this for a fact. Publix and Kroger have their own real estate company that go under sodo names and already have land options to develop.
Publix operates their DC's on a 250 mile radius and Nashville is 213 miles from Atlanta GA. I know; not 2 months ago some the top people from Publix went on a land search for a new location for a DC. Publix wants to move to the north and eastern parts to the country, and Food City's DC is a prime location to operate the eastern coast stores Publix already have, and to fill in the rest of the country in between.

“Pistol packin' momma!”

Since: Jul 09

Jefferson City

#155 Aug 23, 2009
Does anyone have any new information?
eastgatenole

Tallahassee, FL

#156 Aug 23, 2009
Tn Express wrote:
Eastgatenole, thanks for the informatve web-sites. Take it from a person who has dealt with Publix from the very first store in Nashville, some 7 years ago. Both Kroger and Publix and any other "Big Dog" in the business hold the right to land deals all over Knoxville and Middle Tennessee. I know this for a fact. Publix and Kroger have their own real estate company that go under sodo names and already have land options to develop.
Publix operates their DC's on a 250 mile radius and Nashville is 213 miles from Atlanta GA. I know; not 2 months ago some the top people from Publix went on a land search for a new location for a DC. Publix wants to move to the north and eastern parts to the country, and Food City's DC is a prime location to operate the eastern coast stores Publix already have, and to fill in the rest of the country in between.
Thanks for the feedback, TN Express. You may indeed be correct about Publix' "250-mile radius ruke." While that DOES seem to conform with the pattern of their growth over the last 10 years, that is a considerable break with tradition over the entire history of the company: I remember when they didn't wanna build stores more than ~150 miles from the nearest DC, which is why for the LONGEST time the Pensacola Street store in Tallahassee was a far west as the company went--that location being roughly 150 miles from Jax. NOW we have stores in southern Alabama that are being served from Jax. What's that, 300 miles?! Such great distances are obviously unsustainable, given the rise in fuel prices over the last decade. In my view, Publix needs to do the following ASAP:

1) Build a DC at or near Bay Minette, AL--this would allow the company to saturate Mobile and the western Florida panhandle relatively inexpensively in terms of fuel costs for product transport, and reach Baton Rouge and New Orleans with relative ease. The advantage of a site like Bay Minette is that it sits on the interstate, but is NOT on the coast (we don't need to build any hurricane-endangered DCs!)

2) Find a way to reach the EASTERN part of SC (the parts that can't be served easily from ATL). Whether that means building a DC in, let's say Florence, SC I don't know. Or does the company take the bolder move of opening a few stores in NC NOW in cities that can be served from ATL (places like Asheville and Charlotte) and then build a DC in Raleigh/Durham in the future, which would allow them to saturate the highly populated areas of NC, reach Myrtle Beach and the coasts of NC and SC, and reach from Richmond, VA all the way to the DC suburbs.

3) FORGET a DC in Orlando. This was mentioned in a recent annual report as the next one to be built. WHY IN THE WORLD would you "waste" the money for one in ORL (when the FL stores are already being served capably from the DCs that we have in the state) instead of building DCs in conjunction with EXPANSION--say in a place like mentioned a moment ago in NC, or in Memphis (a market that we should NOT allow to go untouched for ANYWHERE as long as we've left Knoxville undeveloped).
executiveboard

Harrison, AR

#157 Aug 23, 2009
expect an announcement to your stores this week
eastgatenole

Tallahassee, FL

#158 Aug 23, 2009
executiveboard wrote:
expect an announcement to your stores this week
Uh, that's NOT Publix' style. Announcements don't come down through the store chain--they are made at and from the top.
eastgatenole

Tallahassee, FL

#159 Aug 23, 2009
executiveboard wrote:
expect an announcement to your stores this week
Can someone explain to me why this deal would make sense for Publix? If FC doesn't want to sell ONLY their east TN stores (and why would they--those are some of their best performers) and Publix would therefore need to buy the entire operation in order to get the FC Abingdon, VA warehouse (along with a LOT of FC stores in small towns that would almost certainly NOT be turned into Publix stores).

Given that FC is not in financial straits based on anything that my research has disclosed, Publix would NOT be able to get the FC business at a discount. It therefore would be a LOT cheaper and make a TON more sense, in light of the considerations outlined above, for Publix simply to build THEIR OWN warehouse in TN or NC.

Arguments to the contrary?
KY store

London, KY

#160 Aug 23, 2009
Everyone should know Food City hasn't sold and is not for sale. If Publix wants to build stores where ever they want they can. Another thing the Food City stores in small towns make alot of profit for Food City and shouldn't be overlooked.

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