There was a time when A&P was the largest grocer in America. Later it became the butt of jokes. (Where's the best place to open a supermarket? Anywhere close to an A&P.) Today, it's too sad to make fun with news that A&P has filed for Chapter 11 protection for the second time in the past five years with plans to sell or close the stores it currently operates.
According to reports, Great Atlantic & Pacific Tea Co. (A&P's corporate name) has reached an agreement to sell 120 of its 296 stores to Stop & Shop, Acme Markets and Key Food Stores. It has also identified 25 locations it plans to close. One of the factors that may complicate the sale of locations, as reported by The Record in June, is that many stores have only five or six years left on their leases. With locations primarily in the New York metropolitan region, any new owner would likely face even pricier rents under new lease terms.
The reasons for A&P's decline are no secret. For years the company was criticized for being slow to respond to market conditions, often focusing on extracting dollars from vendors rather than selling to its customers. It failed in comparison to competitors on both price and customer experience. For many shoppers, including this one, A&P-owned banners became the place to drop in for a quick purchase because stores were nearby. There were never enough customers in a store to cause long lines at the checkout.
Photos: A&P
The decision to file for bankruptcy was also not a surprise as news reports and rumors of the company's struggles have been widely circulated. Back in June, Imperial Bag & Paper Co., a supplier of shopping bags and food containers, sued A&P for failure to pay close to $3.7 million in debt. The grocer, it was alleged, ended its relationship with Imperial after the vendor asked for payment upon delivery rather than continuing to extend it credit terms.
- A&P Bankruptcy Filing Indicates Likely Demise - The Wall Street Journal (sub. required)
- Bankruptcy signals end for Montvale-based A&P - The Record
- Jersey City grocery bag supplier says A&P owes it $3.7 million - The Record
- ACME Markets Announces Bid to Purchase 76 A&P Stores - ACME Markets press release