USA: Giant Eagle cutting costs, offering hundreds of buyouts
The Giant Eagle supermarket chain is offering buyouts to about 1 percent of its 34,000 corporate employees, or roughly 340 workers.
The company, based in the Pittsburgh suburb of O’Hara Township, announced Monday that it’s cutting costs because of falling grocery prices, and analysts contend the company is also dealing with increased competition from discount grocers like Aldi.
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“It’s all about the money and trying to keep the company profitable,” said Milwaukee-based analyst David Livingston. “These are employees up in age. They’re ready for retirement. It’s a cost-saving move.”
The chain owns or operates more than 420 supermarkets and GetGo convenience stores and other outlets in Pennsylvania, Ohio, West Virginia and Maryland.
The buyouts don’t affect store employees like cashiers and baggers but are limited to corporate employees.
“The company has realized a need to maximize cost efficiencies, reduce overhead costs and streamline our supply chain,” company spokesman Dan Donovan said, adding that the decision is driven by various factors including “deflationary trends in food pricing.”
Supermarket chains have also been struggling to compete with online grocery delivery services and the cheaper prices offered by no-frills Aldi stores and other discounters.
The federal Bureau of Labor Statistics said food-at-home prices have declined nearly 2 percent in the last year, with most of that fueled by prices for meats, poultry, fish and eggs.
Other grocery chains have been repositioning themselves in the market recently, including Minneapolis-based Supervalu Inc., which said Monday it’s selling its Save-A-Lot business to Onex Corp. of Canada for $1.37 billion.
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