All Eagle Food stores have closed in my area! Why?

[Leothelion]

Is this a nationwide occurance? I don't know how extended their operations were.

In this little nieve world of mine and I may be wrong but I place the blame on their Eagles Saver Card. Everyone needed to have this card to buy at the lower posted prices. I didn't like the card! I never wanted the card and I never acquired one. And so I didn't shop there. Did many others feel the same.

Another senario centers around the owners of this cooperation. Did they create this (hassle) card to drive away their customers. Did the owners want to get out of this business to do something else. The Hyvee grocery stores are going up everywhere. Does anyone know the whole story.

How is this related to coin collecting? Is David Hall doing the same? Is he shooting his own company in the foot to get out of the business. He's made his millions, why wouldn't he do it to do something else with his life, like retire.

 

Leo

[Wihlborg]

Leo,

 

Why would DH have to shoot himself in the foot to get out of the business? As you have said he has made millions already, If he wanted to retire he could just sell and get out.

 

John

[CarlWohlforth]

It seems Eagle is a regional, mid west, chain. They are bankrupt. Some stores were closed, others sold, others still waiting to find out what will happen. Food stores need to be very large to deal with their newest competitor WalMart.

[Leothelion]

If he wanted to retire he could just sell and get out.

 

I guess a company can sell out whenever it likes to, even when their stock is at a all-time low.

 

Leo

[jtryka]

Eagle is indeed in Chapter 11, and last I heard, there were a couple investor goups looking at them in conjunction with buying the Dominick's chain from Safeway. Sorry for your loss of a local food store, but the industry is getting more competitive. Around here, all the chains (Safeway, Albertsons and QFC) have these cards, and no one seems to care too much. I only balk at the one's you have to pay for, like Costco or Sam's. What other chains are in your area? You must have a Kroger, or a Jewel or something? As for DH, that is a whole other story, with almost no similarities in my mind to the grocery chains.

[Leothelion]

As for DH, that is a whole other story, with almost no similarities in my mind to the grocery chains.

 

I was thinking along the lines when companies are driven into the ground by the hands of mismanagement. We had several Eagle Food stores in our area that included an Eagles food distribution center. This store chain had been around since 1893, 1000's lost jobs.

The new chain around here are the Hyvee stores. several have and are in the process of being built, brand new, from the ground up. Many workers have already found new work in these new stores. The Hyvee store I frequent, it was amazing to see and recognized many of the incoming former Eagle shoppers.

I guess, I have never understood the shopping cards. I didn't like the idea that if I didn't have one, that I had to pay the higher price if I wanted the item. Paying $1.89 for a 2 liter pop was redicules when I knew I could get the same thing for .99 at another store. It is my belief that many others felt this way. And that's why the stores closed because they lost many customers who didn't want the hassle.

Jewel food stores are the same way and I hate it when they would ask, "do you have the Jewel Preferred Custumer card?" I don't shop there either!

So this brings me back to my question. Do company owners run their companies into the ground to get out from under them and move on. Is it possible that DH could be doing the same with his business which is approaching 20 years of operations in 2005 or 2006. Even if he decides to sell the company, is this best done when the company is bottoming out or when their stocks are soaring?

 

Leo

[SilverEagleCoins]

Company owners will do whatever they can to maximize the benefits when they sell. In some instances they can make more money if they file Chap 11 and sell. In some instances they make the most money when they are still rising. In some rare instances a competitor will buy a rival just to shut them down and decrease competition.

 

I have been involved in all three of the above scenarios, and many more when working with owners looking to sell. Each company's cash position, market share, debt, financial backers and other competitive factors make each sale unique.

 

I am under the impression that PCGS is a subsidiary under a public parent company which means that Dave Hall ultimately has to answer to the shareholders. It is his fiduciary duty to maximize the amount of benefit if he gets approval from the shareholders to sell.

[gmarguli]

I was thinking along the lines when companies are driven into the ground by the hands of mismanagement.

 

You should check out the Harvard Business Review cases. There are hundreds of case studies where solid, successful companies are run into the ground by management that doesn't have a clue, runs the company for their personal gain, or are just inept, do-nothing insiders, and all around . All of those could easily apply to David Hall and the way CU is run.

 

As for the supermarket, I can understand them going out of business. I don't know if it is going on it other states or just here, but we have the store workers picketing because they aren't being paid enough. These poor people who are making $18+ dollars an hour for a job that a monkey could be trained to do are unhappy that the stores want them to kick in a few percentage for their health care and don't want to give them a $1/hour raise and want to hire new people at a competitive wage instead of the insane $18/hour wage.

 

These people are on strike because of this. They are outside the stores asking us not to shop there to show our support for them.

 

The stores claim they can't survive because their competition (Wal-Mart, Costco, smaller markets) are paing the workers under $9 an hour.

 

Now, I have no idea is this is what is happening to Eagle Foods, but it wouldn't surprise if greedy unions had a hand in putting them out of business.

[jtryka]

Ok, let me clarify a bit. I think that DH et al are in a market leading position (at least historically and in their own minds) so they are adopting an almost monopoly type approach to their service and their customers. If you don't like the way they are doing things, go scratch, because they are #1 and their slabs sell for more money in the secondary market, and if you want those benefits, you'll shut up and pay, and just put up with the lousy customer service etc. My belief is that DH has an exaggerated sense of self-importance, and really has no idea of the impact of his actions on customers or the competitive environment. And to some extent he is right. Certainly, for the modern series, a PCGS MS-69 brings more money than an NGC MS-69, but things are just starting to change. To me, the main advantage they have is that they lead in one segment, moderns (there may be others too, so don't crucify me), and on most classic series PCGS and NGC are pretty much equal, with the exception of turnarounds and customer service, where NGC is superior. Should the modern area turn cold, PCGS and DH are in a for a rude awakening.

 

Supermarkets are much different. For one, margins are incredibly tight, on average 1c to of every dollar you spend at a store goes to the bottom line of the store. So right off the bat, the structure of the business is different. Then you add a high level of unionized workers who demand higher wages, pension benefits, and free healthcare for themselves and their families. You have healthcare costs rising 15-20% every year for the last few years, while people's spending on food has been rising 1-3%. Now add the big factor of Wal-Mart which is non-union, pays their workers on average 25-30% less than their union counterparts and gives them no pension and much fewer healthcare benefits. With Wal-Marts advantages on costs and their leverage with suppliers to get better prices, it's no wonder they have gone from zero to being the largest grocery retailer in the country in just 10 years. This pressure had been felt by the big boys, Kroger, Albertsons, Safeway etc. but it's been devastating to many smaller regional players like Eagle (which also has it's operations in one of the most competitive markets in the country). As for your dislike of cards, that's your personal preference, and there are many people who would agree with you, though on the whole, the vast majority of customers really don't care. Albertsons (who own Jewel) never used to have a card program on the west coast, and they tried to compete against other chains on that basis (i.e. shop with us because we don't have a card) but if failed, and Safeway and others were eating their lunch. So they rolled out a program here. From what I have seen, catering to people like you who loathe cards only works if you can offer additional non-price competitive advantages. Most people who refuse to use card are the same people willing to pay more for better service, carry-out service to their car, and other sorts of things that the large chains can't offer on a cost effective basis. But for the larger chains, these cards tend to foster more loyalty and more incentive for people to shop at their stores, especially for more price conscious consumers. For your benefit though, most of the major chains are moving to a more "every day low price" format, so there will likely be less emphasis on cards in the future.

[braddick]

Good points all around. Just a couple of thoughts. Working in Law Enforcement, of course some of our time lately is wasted having to deal with disturbances caused by the picketers in the area. Some of them are removing manhole covers in the back lots causing eighteen wheelers to break an axle as they attempt to drive to the loading docks.

 

I find it strangely ironic these same $18.00 an hour employees on strike (that goes up to $53.00 an hour if they work past 40 hours that week and also work a holiday!) are screaming for people to take their business to local stores who are paying their employees $9.00! Way to go, supporting ALL the grocery workers!

 

Regarding the cards: Although not heavily promoted, you may also simply type in your phone number on the display machine/ATM instead of swiping your card and the same discounts apply. I also don't like carrying the extra card(s) and simply manage doing it this way.

[gmarguli]

Albertsons (who own Jewel) never used to have a card program on the west coast, and they tried to compete against other chains on that basis (i.e. shop with us because we don't have a card) but if failed, and Safeway and others were eating their lunch. So they rolled out a program here. […] For your benefit though, most of the major chains are moving to a more "every day low price" format, so there will likely be less emphasis on cards in the future.

 

In CA Albertsons doesn't have a card. That is one of their selling points. From what I see, their specials are usually pretty good, but they run out unlike the other chains, and their stores don't compare to Ralphs (Kroeger) in quality and selection.

 

I used to dislike the cards and their ability to track what I buy. However, a couple of things changed. First off, I realized that I don't really care if they track what I buy. Why should I care if they know that I purchased a tube of toothpaste, a pineapple, and a box of fried chicken last week? I can't imagine they are using this info to target me as a shopper. I still get the same advertisements in the mail that arrive at my PO Box and my girlfriends place. They aren't customized. Secondly, I signed up for the Upromise program where companies will give me money for a college fund for certain things I buy. I've probably gotten $40-$50 in the last year just by doing my normal supermarket shopping without caring about which product I buy. Lastly, I went to purchase a pack of steaks and their regular price was something like $45, but the "Club Price" was like $15. It was an insane difference and basically forced me to sign up for the card or shop elsewhere.

 

If you don't want to use a card just tell the clerk your phone number and give the number of your neighbor. Or you can sign up and use the phone number 555-555-5555 and use that one.

 

[TJ]

I shop at Nob Hill (Raley's). No cards, they unload your cart, no plastic bags, paper with handles. They used to insist on taking your groceries to your car (keeps carts from disappearing into the neighborhood) but now they let you take your own out if you want. Full SERVICE!

[SilverEagleCoins]

At my local sotre after I personally spend $500 I get a coupon for 25% my next visit up to $100 savings. If they didn''t use the card they would have no way of knowing what I was spending. Unfortunately you do not know what your running total is unless you add up all your receipts. The discount just sort of pops up on the trip you are eligible when you are paying. SURPRISE!!

[TomB]

Here on the east coast we have Stop'n'Shop and A & P stores near us and both of these chains use the card program. We have cards for neither store, however, when I go to the checkout I simply tell the cashier that my wife has our card and then the cashier swipes the store card through the reader and I get all the discounts. We have never signed up for a card at either place.

 

Throughout high school and college I worked at the local supermarket, it was called Kilroy's Wonder Market, and it was a very small, family owned business that regularly beat down the competition. The store had only six aisles that were each less than half the length of a normal supermarket. We were not union, while every other store was, we were not open past 9:00 pm during the week and were only open until 5:00 pm on Saturdays. There were no Sunday hours until shortly before I left, and even then they were only open until 4:00 pm. We did not take credit cards and didn't even have registers that scanned the food prices, everything was put in by hand. Additionally, since we were so small, we had much less variety than the other stores, although we did have an enormous barrel of pretzels near the front of the store and everyone who worked or shopped there was encouraged to take a handfull to eat while they were shopping or working. The dress code prohibited jeans, sneakers, clothes with stains on them or even coming in with stubble on your face. We did, however, have a profit sharing plan, received paid vacations, had holidays as paid days off and were also paid far more than the competition. I was making $12 per hour in 1986 to work part time in a grocery store and I was not skilled labor. Kilroy's succeeded partially because of the superior customer service we all provided. It was drilled into us that we treat folks with respect and not only perform our jobs but do them well while making the customers happy with their decision to shop there. An example of that philosophy was our Customer Courtesy Check system where, if someone didn't have the required money to pay for their groceries, we would take a small, white sheet of paper and put down the date, their total and their name on the paper and then slip the paper into a recipe box. The people then took their groceries home and would pay when they had the money. Only three blocks away there was a large supermarket store and every year or two a new chain would move in as we would trounce the competition. The store is still in business.

 

I guess there are some details of my grocery store experience that can be used in a PCGS/NGC scenario.

[SilverEagleCoins]

Tom as usual your well spoken words are true!!! All businesses must constantly assess the current market needs, the strong areas of their competition and vulnerablilities of their competitors. Knowing what the customers want that the competition is lacking, like that Courtesy Payment Center at your childhood store, is above and beyond service as long as they don't get burned too many times.

 

Not having been in the coin game long enough I cannot comment on PCGS and NGC. Sounds like PCGS has a customer service and guarantee weakness while NGC may hvae pulled a money grubbing boner with the multi-slabs. Both TPG have strengths and weaknesses grading certain series of coins. In such a small coin community, it would nto really tkae much by either company to make some adjustments to strengthen their positions.

[Newmismatist]

Tom

 

Slightly OT, as this involves an Office supply store in my home town - it was in business for 70 years - they would deliver your order for free, they provided excellent service, if they didn't have it, they'd get it for you, I had an office account since the very 1st day I opened my office. - I knew the owner and then his children who ran the store after he retired. They closed about 4 years ago, They couldn't sell copy paper, and supplies as cheap as Staples, Office Max & Office Depot, their service was just as good the last day they were in business as the first time that I bought drafting supplies 40 years earlier when I was 12 years old. Sometimes it's the money, not the service (I think they made a movie about that - "You've got Mail" - we lost our locally owned bookstores too - same reasons - could not sell as cheaply as the Mega bookstores - it didn't matter that they read the books and could tell you which one's you'd like)

 

Something like buying raw coins vs buying slabbed coins - things change, not always for the better.