Supervalu Grows Save-A-Lot Discount Grocery Chain

Supervalu is investing in the growth of its Save-A-Lot chain as it aims to double the number of its stores; the grocery operator is adding 22 stores in February and March.

Supervalu, Inc., is opening 22 stores under its Save-A-Lot brand during February and March-marking an increased investment in its national discount chain while the company looks to turn around its struggling retail business.

Save-A-Lot, a wholly owned subsidiary of Eden Prairie-based Supervalu, bills itself as “one of the nation's leading hard-discount, limited-assortment grocery chains.” In late 2009, Supervalu announced a goal to double the size of its Save-A-Lot chain from about 1,200 stores to 2,500 within five years, and it has recently re-emphasized its plan to invest in the growth of the chain.

In February and March, Save-A-Lot is opening three new stores in New York, four in Pennsylvania, three in Tennessee, three in Ohio, and one each in Colorado, Alabama, Delaware, New Jersey, and Arkansas, according to Save-A-Lot spokeswoman Chon Tomlin. The company has not yet disclosed the locations of the four remaining stores that will open by the end of March.

Save-A-Lot currently operates about 1,350 stores in 39 states, including a couple in Minnesota. According to Tomlin, the chain opened more than 100 new stores last year, and it remains in “growth phase.”

For its most recent fiscal year, Supervalu-one of Minnesota's five-largest public companies-reported $37.5 billion in sales, down 7.5 percent from the same period the prior year, and a $1.5 billion net loss. (Its 2012 fiscal year ends later this month.)

For the third quarter, which ended December 3, Supervalu reported revenue of $8.3 billion-down from $8.7 billion during the same period in 2011-and a net loss of $750 million, compared to a loss of $202 million the year before. Its loss included an $800 million charge related to its turnaround efforts; adjusted for those costs, earnings totaled $50 million.

Earlier this month, Supervalu announced plans to cut 800 jobs, including 200 in Minnesota, and described the move as part of its ongoing effort to reduce operating costs and ultimately provide more competitive pricing to Supervalu customers.

Related Stories