Cub Foods Cuts 200 Part-Timers in Twin Cities

The grocery chain's parent company, Supervalu, Inc., wouldn't provide details, but the company has been struggling and cutting expenses recently in an attempt to remain competitive.

Cub Foods laid off about 200 part-time workers in the Twin Cities-or about 3.6 percent of the grocery chain's work force.

The move comes at a time when Cub Foods' parent company, Eden Prairie-based Supervalu, Inc., is struggling and cutting expenses.

Supervalu spokesman Mike Siemienas, reached by phone Wednesday morning, would only confirm that “staffing adjustments” affecting a “small percentage” of local Cub workers were made within the past two weeks.

But officials at two local branches of the United Food and Commercial Workers (UFCW) Union said that 200 part-time workers were affected-150 in the west metro and 50 in the east metro.

“Optimizing our structure will allow us to operate more efficiently and effectively and ensure that we are positioned for long-term success,” Siemienas said. “This is a very tough environment and we need to make these changes to remain competitive.”

Raymond Sawicky, president of UFCW Local 653 in Plymouth, told Twin Cities Business on Thursday morning that he thinks Supervalu's decision was at least partially prompted by a current lull within the industry.

“We consider this really the dog days of the grocery business, so to speak,” he said. Between Christmas and Easter, many locals head south-and it's a very slow period for local grocery stores. Consequently, it's not at all unusual for them to cut back on staff.

Sawicky said that Cub cut between 50 and 100 part-time positions around this same time last year, but all of the affected workers were hired back when business picked up again. “Cub Foods has been a very good company” to local employees, he said.

With 46 corporate-owned stores and 28 franchised stores within the state, Stillwater-based Cub is the largest local grocery chain. Its corporate-owned stores-including three in Wisconsin and Illinois-together employ about 5,500 people.

Supervalu has struggled in recent years amid tightened consumer spending, and its same-store sales have declined for the past 11 consecutive quarters. In January, on news of a weak third quarter, the company's stock closed down 11.6 percent at $7.59-the lowest level since 1984.

The company eliminated 300 corporate jobs earlier in this fiscal year, which ends February 26, and CEO Craig Herkert said during a third-quarter conference call that an additional 350 corporate jobs nationwide would be cut through both attrition and layoffs by the end of May.

Supervalu recently announced plans to close 20 unprofitable stores within the current fiscal year in order to “eliminate negative operating costs for a healthier start to the new year.” The company has also offered some corporate and office employees a chance to take unpaid time off, with managers' approval, through the end of the fiscal year.

Despite Supervalu's recent struggles, it is Minnesota's fourth-largest public company based on revenue, which totaled $40.6 billion during the fiscal year that ended in February 2010-down 8.9 percent from the previous year.