Wal-Mart's shadow usually looms large whenever grocers start talking about establishing a stronger price position in the markets they serve. Grocers, even when they don't mention Wal-Mart by name, can't get away from the fact that many consumers compare what they pay at the local Supercenter to the supermarkets where they shop.
It's become popular over the past couple of years for supermarkets to engage in store-wide cuts as a means to establish their own price credentials. Cathy Green, the new president of Food Lion, came into the position in February as her company was rolling out its own lower price initiative.
She told The State, "The most important thing I had my eye on was our price positioning, especially given the economic situation. (Price) is now number one in the consumer's mind."
Ms. Green said her goal was to make Food Lion the "low price leader" in the markets it serves.
"We are working hard to transform business processes to invest in price. It's about running our business more efficiently. It has nothing to do with just cutting costs. A small example of that is in our distribution centers right now. In an aisle where a selector is not selecting, the lights are off," she told the paper.
Discussion Questions: Is Food Lion in any better or worse position to cut costs than any of its traditional grocery competitors? What will it take for supermarkets to truly be price competitive with Wal-Mart, Target and other big box stores?