Rumors of a Kroger-Target Merger

[bing101]

https://www.wcpo.com/news/insider/kroger-merges-with-target-unlikely-but-intriguing

There is speculation at play but its the going after Amazon part that's at play here.

[hbelkins]

Well, they're both too expensive to shop at unless they're holding a big sale, so it would be a perfect marriage.

[bandit957]

Federal and state regulators need to swat down this merger with all haste.

[Scott5114]

Federal and state regulators need to swat down this merger with all haste.

I mean, I'm all in favor of antitrust regulation, but it'd be hard to argue that a combined Target-Kroger would be too big to compete against. Walmart is an option, as is Amazon for some things, and any number of local grocers across the country.

[Max Rockatansky]

Federal and state regulators need to swat down this merger with all haste.

I mean, I'm all in favor of antitrust regulation, but it'd be hard to argue that a combined Target-Kroger would be too big to compete against. Walmart is an option, as is Amazon for some things, and any number of local grocers across the country.

Anti-Trust regulators wouldn't be interested unless a company had a least half of domestic market share.  There are still way too many retail options out there that chip into the Grocery and General Goods market in terms of market share.  Target ought to be cautious with the moves it makes, it traditionally hasn't done well absorbing other companies and is coming off a massive failure in Canada.  At least something like this makes way more sense than the Sears-Kmart Merger did.

[oscar]

If the rumors pan out, they might focus on any Pacific Northwest cities where Kroger's Fred Meyer superstores (the most Target-like part of Kroger, but really somewhat more like Wal-Mart) overlap with Target, especially if Wal-Mart is weak/not there in particular markets.

SOP for the antitrusters is selective divestitures, where a merger of store chains raises issues in a few places but not across the board.

[bandit957]

Anti-Trust regulators wouldn't be interested unless a company had a least half of domestic market share.

I remember reading that Kroger already had a 70% share in grocery retailing in the Cincinnati area.

[Max Rockatansky]

Anti-Trust regulators wouldn't be interested unless a company had a least half of domestic market share.

I remember reading that Kroger already had a 70% share in grocery retailing in the Cincinnati area.

But that's a regional thing.  Federal regulators wouldn't act unless that kind of market share was on the national level and some sort driving motivation like price fixing. 

[SP Cook]

A Kroger - Target merger does not even get a sniff from federal regulators.  It has no anti-trust issues.

It, however, seems like the Sears-K Mart merger.  Two sick people getting married in hopes of becoming healthy. 

Kroger is burdened by ridiculous union contracts that force it, which is to say you the customer, to pay triple the value for what is essentially unskilled entry level work.  Work places like Wal Mart can get done for you, the customer, at vastly more reasonable prices.  Target has no idea what it wants to be.  The market was not looking for a slightly upscale Wal Mart. 

[bandit957]

Kroger is burdened by ridiculous union contracts that force it, which is to say you the customer, to pay triple the value for what is essentially unskilled entry level work.

The workers wanted a union, so they deserve a union.

[Max Rockatansky]

Kroger is burdened by ridiculous union contracts that force it, which is to say you the customer, to pay triple the value for what is essentially unskilled entry level work.

The workers wanted a union, so they deserve a union.

The customer just ends up paying the price in the end, or they just move elsewhere.  I never understood the point of over paying employees for jobs that are really meant for high school/college kids or people collecting Social Security.

[bandit957]

I never understood the point of over paying employees for jobs that are really meant for high school/college kids or people collecting Social Security.

But why shouldn't these workers be allowed to form a union?

[Max Rockatansky]

I never understood the point of over paying employees for jobs that are really meant for high school/college kids or people collecting Social Security.

But why shouldn't these workers be allowed to form a union?

Never said they shouldn't be allowed, I'm just saying that there isn't much of a point.

[hbelkins]

Kroger's unionization is probably why prices are so high there. And most of their sales are limited to people who have the loyalty card, and there are a number of people who don't like to join such programs due to privacy issues.

We've been Kroger card carriers for years. Every so often, we'll get a package of coupons in the mail. They're usually for items that we have previously purchased. Obviously that data is gleaned from the card program.

There's nothing stopping Walmart employees from unionizing if they want. There's obviously a reason they haven't yet. In large part they must be satisfied with their jobs, hours, pay, etc., as it is now and they see no need to unionize.

As for Target, I've long said that I don't get the fascination with them, other than being a place that the Walmart haters like to go to make them feel better about themselves. I've found the prices to be much higher, the selection of merchandise smaller, and the quality no better than what's available at Walmart.

Same for Meijer. I know Michiganders love Meijer, but to me it's a more expensive version of Walmart. I don't like to shop there unless they're having a sale.

I'm not sure what a merger would accomplish. Kroger is a grocery story that's expanding into general merchandise in a few places with their Marketplace stores (but about all I see in them that isn't grocery-related is patio furniture; I have yet to see clothing, fishing tackle, electronics or other general merchandise in one). Target is a general merchandise store that carries a few grocery items (canned or boxed) but no fresh produce, no deli, no bakery or other things one would generally find in a grocery store.

If the rumors pan out, they might focus on any Pacific Northwest cities where Kroger's Fred Meyer superstores (the most Target-like part of Kroger, but really somewhat more like Wal-Mart) overlap with Target, especially if Wal-Mart is weak/not there in particular markets.

SOP for the antitrusters is selective divestitures, where a merger of store chains raises issues in a few places but not across the board.

I'm curious to see how the merger of Family Dollar and Dollar Tree will work out. I've noticed no differences in our local Family Dollar. Their $1 offerings have not expanded. Of course, Dollar Tree is not a competitor here, as the nearest locations are an hour away. Dollar General is expanding rapidly (they built a second store in my community, about three miles away from an existing DG) and I've noticed they carry more $1 products.

I'm a Dollar Tree fan. Great place to get snacks for the road.

[bandit957]

There's nothing stopping Walmart employees from unionizing if they want.

Except of course Walmart, which actively suppresses unions.

[Rothman]

There's nothing stopping Walmart employees from unionizing if they want.

Except of course Walmart, which actively suppresses unions.

Yeah, H.B.'s logic is very strained there that workers do not unionize there because they're satisfied.  More like paid pennies and kept desperately beholden to their job since they are so easily replaced; their timesheet abuse was legendary (i.e. work now, but you're not getting paid).  To unionize would take a herculean effort on behalf of ALL employees and even potential scabs. 

[oscar]

^ Yeah, Walmart really, really hates unions, and goes to a lot of trouble to prevent unionization. The last and AFAIK only time it had a union forced on it (at a store in Quebec), that store was promptly closed.

I'm not sure what a merger would accomplish. Kroger is a grocery story that's expanding into general merchandise in a few places with their Marketplace stores (but about all I see in them that isn't grocery-related is patio furniture; I have yet to see clothing, fishing tackle, electronics or other general merchandise in one).

Kroger's Fred Meyers are definitely "general merchandise + groceries" (better at the latter than Target), and at least some even have jewelry stores. Of course, the one closest to you would probably be the Fred Meyer in Pocatello ID. Definitely a Pacific Northwest thing. But within that region, it seems to be a popular alternative to Walmart, and indeed has done in Walmarts like the one that used to be in Juneau AK. 

I don't know Kroger's logic in acquiring the Fred Meyer chain, but I haven't heard of any Kroger interest in expanding Fred Meyer or at least the concept to other regions. Not even adjacent Utah, which used to have at least one Fred Meyer, but Kroger's presence there is only the Smith's grocery store chain (but some of the Smith's stores include Fred Meyer jewelry stores).

[ThatRandomOshawott]

Pro: More competition for Amazon and Whole Foods. Knowing Amazon, they could create a real, Kroger-esque grocery store in the future;if this happens, all of the other stores would probably die out due to Amazon's low prices. If a merger happens, then Amazon would be less able to take over the grocery store world.
Con: The merged company would have LOTS of power, and it would be a headache for regional, smaller grocery stores like Hy-Vee and Food Lion.

[LM117]

I'm curious to see how the merger of Family Dollar and Dollar Tree will work out. I've noticed no differences in our local Family Dollar. Their $1 offerings have not expanded. Of course, Dollar Tree is not a competitor here, as the nearest locations are an hour away. Dollar General is expanding rapidly (they built a second store in my community, about three miles away from an existing DG) and I've noticed they carry more $1 products.

I'm a Dollar Tree fan. Great place to get snacks for the road.

I haven't noticed any changes in the Family Dollar near me, either. However, the store manager is NOT happy at all about the merger. According to her, the workload for managers has increased with less time off given. They've also talked about cutting benefits, though she did not go into exact details and I didn't press her. She's made it known that if she had any other alternative, she would quit. But given the shitty job market in Danville (along with much of southern VA), she's pretty much stuck for the time being.

[adventurernumber1]

I remember reading that Kroger already had a 70% share in grocery retailing in the Cincinnati area.

That does sound like a lot, but that is probably because Kroger's Headquarters is in Cincinnati, Ohio, and that is also where it was founded.

[LM117]

Con: The merged company would have LOTS of power, and it would be a headache for regional, smaller grocery stores like Hy-Vee and Food Lion.

Food Lion (aka Shitty Kitty) could use a good swift kick in the ass. Their prices have gotten more expensive, most of their store brand products aren't worth a shit and, lately, the attitudes of some of their employees (management included) leaves a lot to be desired.

10-20 years ago, Food Lion was actually a decent place to shop and the store brand products were nearly as good, if not the same, as the name brand products.

[Brandon]

Guys, this is a rumor that somehow became news.  It's very doubtful this would actually happen.

[hbelkins]

Con: The merged company would have LOTS of power, and it would be a headache for regional, smaller grocery stores like Hy-Vee and Food Lion.

Food Lion (aka Shitty Kitty) could use a good swift kick in the ass. Their prices have gotten more expensive, most of their store brand products aren't worth a shit and, lately, the attitudes of some of their employees (management included) leaves a lot to be desired.

10-20 years ago, Food Lion was actually a decent place to shop and the store brand products were nearly as good, if not the same, as the name brand products.

Didn't Food Lion have an issue with tainted meat about 20-25 years ago?

[hotdogPi]

Con: The merged company would have LOTS of power, and it would be a headache for regional, smaller grocery stores like Hy-Vee and Food Lion.

Food Lion (aka Shitty Kitty) could use a good swift kick in the ass. Their prices have gotten more expensive, most of their store brand products aren't worth a shit and, lately, the attitudes of some of their employees (management included) leaves a lot to be desired.

10-20 years ago, Food Lion was actually a decent place to shop and the store brand products were nearly as good, if not the same, as the name brand products.

Didn't Food Lion have an issue with tainted meat about 20-25 years ago?

That's why he said 10-20 and not 10-25 or 10-30.

[froggie]

As for Target, I've long said that I don't get the fascination with them, other than being a place that the Walmart haters like to go to make them feel better about themselves. I've found the prices to be much higher, the selection of merchandise smaller, and the quality no better than what's available at Walmart.

In comparing Target to WalMart, the old adage that "you get what you pay for" holds true.  Sure, Target's a little more expensive than Walmart (not by much, and certainly not at the level you're insinuating).   But in return, you get stores that are cleaner, less cluttered, faster checkout, and higher quality (my experience being opposite of yours) than WalMart.