Jewel Slashing Prices?

So, the local news stations are PUMPING this story about Jewel slashing prices recently. Anyone else laughing at this?
So now, the prices will be mildly crazy as opposed to insane - compared to the smaller grocers? Last night I saw them interviewing ppl who were saying that "Every little bit helps." I personally skip the little bits, and go for huge chunks when it comes to saving money.

Anyone know how Tony's is selling all varieties of Sara Lee Turkey at the deli counter for 3.98 a pound this week, but Jewel is rarely under 7.00 a pound for the exact same product? Not a sarcastic question, I'm really wondering how the big guy is getting twice the price, or if they HAVE to charge that much for some reason?

I was laughing about the same article-- now prices at the Jewel will only be 1.8 times as much as at the A&G or Tony's. Plus the Jewel offers the privilege of using self-checkouts! I am so lucky to be within striking distance of both the A&G and a Tony's. Plus I just saw a sign that a Pete's Fresh Market is "Opening Soon" at the long-boarded up former Jewel site at Belmont and Pulaski. My neighborhood may have poor schools, but it is grocery store heaven.

Jen

I do agree that for most produce, meat, fish, and spices, you can get them cheaper at any produce stand/independent market, etc., so I almost never go to Jewel for that stuff. But what about canned, jarred, and boxed items and housewares like garbage bags and dish soap? Jewel usually has some pretty good deals, has a ton of selection, and takes coupons. I always had the mindset that Jewel is better for that kind of thing. Have I been wrong all this time? Thanks for the help...

sale price + coupons can net you some very good pantry stuff, but I think as of May or June 1, they will no longer be accepting expireds. If they have a decent cereal sale before than, i'll be maxxing out my coupon stash.

I didn't think they took expired coupons anymore anyway, unless they were very recently expired, say, a week ago. Thanks for the tip - I guess I'll have to go through the pack a lot more often, just in case!

Which leads me to ask, how does the average LTH-er pronounce coupon: kewpon or coopon? This spurs much debate at our house.

My wife makes fun of me when I say "coo-pon", and I make fun of her when she says "kyoo-pon".

I'm right, of course

Well, does she drive a Cadillac Kyoop De Ville while having a nice bowl of chicken noodle syoop with a dollop of grey pyoopon mustard on the way to pick up your brand new tyoopee since you've started balding?

seebee wrote:Well, does she drive a Cadillac Kyoop De Ville while having a nice bowl of chicken noodle syoop with a dollop of grey pyoopon mustard on the way to pick up your brand new tyoopee since you've started balding?

You're freakin' me out, man! I was composing a sentence just like this one in my head, using many of the same words, while I typed my response to Pie Lady...I came up with "Check out that dyoochebag in the Kyoop De Ville - his tyoopée just flew off!"

"Syoop" and "pyoopon" are all your doing (though I may have to appropriate them the next time my wife makes fun of me for pronouncing "coupon" correctly )

seebee wrote: I'm really wondering how the big guy is getting twice the price, or if they HAVE to charge that much for some reason?

Having had family members in "the business" (selling to stores, rather than running the stores), the answer they ran into is yes, they most definitely have to charge that much --to cover the cost of all the other stuff they have to carry. The little guy has a few items and most of it moves pretty quickly, because he can guess what his clientele wants. People expect the larger grocery stores to have everything -- seasonal items, such as garden supplies or Halloween costumes, cards, magazines, hair color, shampoo, and so on -- plus all the things that outdate and have to be tossed, which not only includes all the food products, but also all the OTC medicines and vitamins, energy bars, diet drinks, a garden center, fresh flowers, beer, and so on, and then, in the food section, they're expected to have some organic offerings, as well as the regular stuff, a few obscure vegetables, such as celeriac, ethnic foods, health foods, deli items, prepared foods, a full bakery -- you get the idea. The little guy doesn't need to bear that immense burden. Also, a smaller store can more easily monitor such activities as shop-lifting and "casual grazing" (I can't tell you how often I've seen people open a box of donuts, hand one to a crying child, and then put the box back on the shelf). They earn just pennies on any given item they sell -- and the "loss leaders," as the names suggests, lose them money (but, it is hoped, draw in customers, who will buy, they hope, something other than those heavily discounted items). On top of that, if something isn't selling, they have to get rid of it, and as much as I love the "clearance" rack (I've found some unbelievable discounts even in the liquor department -- wine marked down from $10 to $2), I also realize that is another hit to the bottom line.

And with a lot of the big stores, you're also paying to keep them open 24-hours a day. When I pop into a Jewel after midnight, there are often more employees than customers -- and there aren't a lot of employees -- but they're still open.

So ultimately, you're paying for convenience -- not just the odd hours, but the wide range of goods. For people who are not recreational shoppers (and as hard as it is to imagine, those people do exist), the value lies in being able to get everything in one place -- liquor, flowers, chocolates, and birthday card, as well as hair conditioner, mascara, and dinner.

Khaopaat wrote:

seebee wrote:Well, does she drive a Cadillac Kyoop De Ville while having a nice bowl of chicken noodle syoop with a dollop of grey pyoopon mustard on the way to pick up your brand new tyoopee since you've started balding?

You're freakin' me out, man! I was composing a sentence just like this one in my head, using many of the same words, while I typed my response to Pie Lady...I came up with "Check out that dyoochebag in the Kyoop De Ville - his tyoopée just flew off!"

You guys are both freakin' me out, as this is the same argument I get at home! Only his is supplemented by "do you say kewgar?"
PS, I'm right.

Cynthia wrote:

seebee wrote: I'm really wondering how the big guy is getting twice the price, or if they HAVE to charge that much for some reason?

Having had family members in "the business" (selling to stores, rather than running the stores), the answer they ran into is yes, they most definitely have to charge that much --to cover the cost of all the other stuff they have to carry. The little guy has a few items and most of it moves pretty quickly, because he can guess what his clientele wants. People expect the larger grocery stores to have everything...

I didn't think of that, but it makes sense, unfortunately. Don't forget the cost of all those plastic bags.
How did you not slap the woman grazing donuts for her kid?

Pie Lady wrote:
How did you not slap the woman grazing donuts for her kid?

I'd like to say it was self-control, but I think it was more just being stunned and not having a clue what to do. (A friend suggested later that I just run after her with "her" box of donuts.)

The other thing that drives me crazy is when people change their minds about buying something, and just dump it wherever they are -- leaving a quart of ice cream to melt on the magazine rack or a leaky package of raw chicken on top of the candy display near check out. If you don't want to take it back, at least hand it to an employee, so they don't have to do so much damage control.

I am at times amazed that these stores can even stay in business. I sometimes shop there just out of sympathy, trying to reward their efforts by picking up a couple of items from the imported foods section (my Jewel carries Spotted Dick!), a few organic vegetables, perhaps some panko bread crumbs or Thai curry paste. Because these places are convenient, and I'd like them to do well enough to be there when I need them, which may not be all the time, but it does happen -- 10pm just doesn't seem that late to be shopping these days, and Garden Fresh, Whole Foods, and Trader Joe's are all closed by then. (And, for what it's worth, Jewel's Spotted Dick is cheaper than getting it at British Accents in Long Grove.)

I shop at Jewel only for the things on sale, for the most part.

Here are my reasons:

1.) Their beef was once Choice grade and now it's Select, although without a magnifying glass you wouldn't see it on the label.

2.) For years my local store used to stock baby artichokes right about now at a brilliant price of 10 for a dollar, now it's only the large artichokes at @3.99 each.

3.) How 'bout three lemons for two bucks?

4.) Or asparagus at $3.99 per pound?

5.) The deli is a joke and they price everything by the half-pound, which is again written in smaller type...I guess they hope we won't notice

6.) The store grosses $1.65M a week already.

mchodera wrote:6.) The store grosses $1.65M a week already.

But what does it net? If you gross $1.65M a week and spend $1.65M on product and salaries, then you're not getting ahead very quickly.

Of course, as I noted, I'm a big fan of the clearance rack. And I don't buy deli items much of anywhere, as I can make most of it myself, not only cheaper, but better.

So sales, definitely -- and late night emergency runs. And Spotted Dick.

Cynthia wrote:

seebee wrote: I'm really wondering how the big guy is getting twice the price, or if they HAVE to charge that much for some reason?

Having had family members in "the business" (selling to stores, rather than running the stores), the answer they ran into is yes, they most definitely have to charge that much --to cover the cost of all the other stuff they have to carry. The little guy has a few items and most of it moves pretty quickly, because he can guess what his clientele wants. People expect the larger grocery stores to have everything -- seasonal items, such as garden supplies or Halloween costumes, cards, magazines, hair color, shampoo, and so on -- plus all the things that outdate and have to be tossed, which not only includes all the food products, but also all the OTC medicines and vitamins, energy bars, diet drinks, a garden center, fresh flowers, beer, and so on, and then, in the food section, they're expected to have some organic offerings, as well as the regular stuff, a few obscure vegetables, such as celeriac, ethnic foods, health foods, deli items, prepared foods, a full bakery -- you get the idea. The little guy doesn't need to bear that immense burden. Also, a smaller store can more easily monitor such activities as shop-lifting and "casual grazing" (I can't tell you how often I've seen people open a box of donuts, hand one to a crying child, and then put the box back on the shelf). They earn just pennies on any given item they sell -- and the "loss leaders," as the names suggests, lose them money (but, it is hoped, draw in customers, who will buy, they hope, something other than those heavily discounted items). On top of that, if something isn't selling, they have to get rid of it, and as much as I love the "clearance" rack (I've found some unbelievable discounts even in the liquor department -- wine marked down from $10 to $2), I also realize that is another hit to the bottom line.

And with a lot of the big stores, you're also paying to keep them open 24-hours a day. When I pop into a Jewel after midnight, there are often more employees than customers -- and there aren't a lot of employees -- but they're still open.

So ultimately, you're paying for convenience -- not just the odd hours, but the wide range of goods. For people who are not recreational shoppers (and as hard as it is to imagine, those people do exist), the value lies in being able to get everything in one place -- liquor, flowers, chocolates, and birthday card, as well as hair conditioner, mascara, and dinner.

I had always thought that the larger the chain the better the prices based on purchasing power. Truth is that Tony's Finer Foods newer stores and my most recent find, Pete's Market at 4343 S Pulaski are bigger, have better produce, delis, fish/ seafood and meat deptarments. Also there is no comparison to the ethnic offerings as well as the cuts of meat that you can't find at Jewel. Now throw in the prices. Convenience will get me to Jewel maybe once a month. However as I live in Elmwood Park and Caputo's has purchased the old Circuit City at Grand and Harlem, I may never have to set foot in a Jewel or Dominicks after the first of the year.

As an aside I worked for Jewel for 15 years when it was actually Chicago based Jewel.

But what does it net? If you gross $1.65M a week and spend $1.65M on product and salaries, then you're not getting ahead very quickly.

From an acquaintance who works there, our local Jewel is the 2nd best performing store in the Albertson's chain, on a gross or net basis.

Again, my main objections are what I consider the deceptions played out by all the large chains - Wal-Mart, Jewel, Dominick's, Sam's Club - selling select grade meats by reducing the identifying label type face to 5 points, selling deli items by the half pound when most people assume it would be by the pound and other tricks developed to rip off consumers... the quality of the produce is barely acceptable at all these places- especially at Dominick's since they were acquired by Safeway

I, too shop mainly at Caputo's and Tony's, especially for produce and I'm thankful for them.

The buying co-operatives, Central Grocers and Certified, have a lot of purchasing power to benefit their members. Note that these two either are merging or merged, not sure whether the deal has closed yet. Most of our good independents are members of one or the other co-op. Tony's and Treasure Island use Certified. I am not sure the big chains actually have all that much better buying power and do have the curse of slotting fees, which are legalized kickbacks.

The big chains suffer from bureaucracy and long chains of command. The small independent chains have very much shorter chains of command where top management is very close to the stores. This pays off in ability to react to the marketplace and lower overhead. Another cost booster in the chains that also lowers quality is their insistence on centralized warehousing, which devastates quality and cost for fish and produce in particular. Dominick's destroyed their better fish counters when they moved all filleting and other processing from the local stores to a central facility. Some Dominick's stores had pretty good fish operations before the move, which took everything to the level of their worst stores.

Most of the independents are not unionized. They probably pay lower wages and benefits, but the big cost payoff is freedom from frozen work rules and all the inflexibility that produces.

SuperValu (Jewel) chooses what business model that they operate under. If they choose to have a lot of money-losing departments in the store or carry SKUs that will not make them the desired profit margins, that is THEIR problem, not their customers.

Most markets are lowering their prices now that a lot of the commodity prices are a fraction of last year's prices. However, the prices are coming down a lot more slowly than they went up.

Pie Lady wrote:But what about canned, jarred, and boxed items and housewares like garbage bags and dish soap? Jewel usually has some pretty good deals, has a ton of selection, and takes coupons. I always had the mindset that Jewel is better for that kind of thing. Have I been wrong all this time? Thanks for the help...

You might want to do some price-checking at Target. I get most of my dry goods from there if I can. (Due to a small house and household I don't belong to Costco or Sams, and I just don't like Wal-Mart, so those stores were out for me.) I had a spreadsheet going for a few months that I used to do price comparisons and it was eye-opening.

I buy my pantry items at Aldi. I do not have the time to cut coupons and track deals.

I despise Jewel--the one in Evanston is possibly the worst place in the universe.

I am not sure the big chains actually have all that much better buying power and do have the curse of slotting fees, which are legalized kickbacks.

Not sure what this means. Slotting fees are paid by manufacturers to the chains in order to get their products shelved, so it should improve the store's profits.

rickster wrote:

I am not sure the big chains actually have all that much better buying power and do have the curse of slotting fees, which are legalized kickbacks.

Not sure what this means. Slotting fees are paid by manufacturers to the chains in order to get their products shelved, so it should improve the store's profits.

The manufacturers make the slotting fees back by charging more.

I used to work at a company that made and sold cat litter. We had someone whose sole job was to figure out all the chargebacks from the supermarkets - slotting fees, damages (their driver ran a forklift through a pallet of product, we get charged), random charges like memorial funds for people who died, etc. I've not seen anything like it before or since and I would never intentionally go into a line of business where I would have to deal with any supermarket.

RallyMike gets the economics of slotting fees almost right. Manufacturers get back the fees by higher prices to stores that charge the fees. The secondary effect is that profitability of a product is partially due to the slotting fee and partially due to sales. Hence there is a real risk that the product mix is less than optimal from a sales point of view. Supplier kickbacks, legal or otherwise, lower sales because they keep products on the shelves that should not be there and keep other products off the shelves.

ekreider wrote:RallyMike gets the economics of slotting fees almost right. Manufacturers get back the fees by higher prices to stores that charge the fees. The secondary effect is that profitability of a product is partially due to the slotting fee and partially due to sales. Hence there is a real risk that the product mix is less than optimal from a sales point of view. Supplier kickbacks, legal or otherwise, lower sales because they keep products on the shelves that should not be there and keep other products off the shelves.

One of my friends, a retail analyst for the supermarket industry, did an analysis on slotting fees and found that the slotting fees charged to manufacturers represented a very significant amount of the profits of the major chains.

The existence of slotting fees - and I am not going to address the legality of the practice - really hurts the small companies with limited resources. I believe that this practice is forcing the consolidation of a lot of the various food manufacturers. That is why we are seeing 47 varieties of Oreos and a million other product extensions rather than seeing some original products.

ekreider wrote:The secondary effect is that profitability of a product is partially due to the slotting fee and partially due to sales. Hence there is a real risk that the product mix is less than optimal from a sales point of view. Supplier kickbacks, legal or otherwise, lower sales because they keep products on the shelves that should not be there and keep other products off the shelves.

I knew about slotting fees, but I never thought about this unintended consequence. It's analogous to how payola in the record and radio business resulted in airplay for songs that people didn't really want to hear; the "shelf space" of radio being crowded by product the public had no desire for ultimately resulted in the decline and fall of the music business, as people lost interest in recorded music relative to other ways they could spend their leisure dollar.

RallyMike gets the economics of slotting fees almost right. Manufacturers get back the fees by higher prices to stores that charge the fees. The secondary effect is that profitability of a product is partially due to the slotting fee and partially due to sales. Hence there is a real risk that the product mix is less than optimal from a sales point of view. Supplier kickbacks, legal or otherwise, lower sales because they keep products on the shelves that should not be there and keep other products off the shelves.

You're right, slotting fees are a cost of doing business for the manufacturer, so they compensate by charging higher prices to the store, which then pass them on to the consumer. So the conumer gets hurt by both the less than optimum product selection as well as higher prices. The store likes it because a portion of its income becomes fixed and is not reliant sales and doesn't incur any costs to support it. Which is why per jlawrence01, it is such a large part of the chains profits.

I wonder if this affects gas stations and quick-service stores like 7-11 as well? While, obviously, there are other issues at work, this might explain some of the food monoculture in the food desert...

I was at my local Jewel earlier this week - the only reason being that it's the closest grocery to my house. I saw a label for a beer I buy, that loudly proclaimed "Big Relief, Price Cut!" The beer was $11.99. Except, last week the same beer was priced at $9.99. So, being the cheeky monkey that I can be at times, I asked the manager how raising the price by $2 qualifies as a price cut. (Only slightly paraphrasing) "Well, it was $15 last year, so compared to that it's a price cut. That price last week was a special, so it doesn't count."

So a price increase of $2 still qualifies as a "Big Relief Price Cut" in corporate-speak.

706-

I had a similar experience in the Jewel liquor department, though well before the recent "price slash" charade:

I am in often enough (wife likes the parrmacist and gets her meds at the Clarendon Hills store) to keep an eye on prices of my favorite boozes, and had seen that their price on a 1.75Swedka, a slightly-respectable vodka, was running around $24.00. I had been buying it at Costco for $17.99

A couple weeks later, the Svedka was on SALE according to a special sticker on the front of the cabinet. It got my attention and, on closer inspection, turned out they were letting it go for only $34.99... "marked down" fron $41.99!

Such a deal!

I still get mine at Costco- still $17.99.

I enthusiastically share in the general despising (despisement?) of Jewal and, as an equal-opportunity despiser, for Dominicks as well.

Along the lines of rasing prices, but claiming it's a slash -
Watch for:
One week, "Item A" price: 1.99 on sale.
Next week, "Item A" price: 4.19 - BUY ONE GET ONE FREE!