http://www.reuters.com/newsArticle.jhtml?type=businessNews&storyID=2521304 Mon April 7, 2003 10:25 AM ET NEW YORK (Reuters) - Eagle Food Centers Inc. EGLE.OB , which owns and operates 61 supermarkets in Illinois and Iowa, on Monday said it voluntarily filed for Chapter 11 bankruptcy protection after failing to compete effectively with larger, more cost-efficient food retailers. The 110-year-old company said it received commitments for $40 million of so-called debtor-in-possession financing from Congress Financial Corp. to help it run its business. Congress has been the lead lender on Eagle's revolving credit line since 1995. Eagle, based in Milan, Illinois, said it filed Chapter 11 to boost liquidity and help it restructure. It said major grocery chains and supercenter retailers, which include Wal-Mart Stores Inc. WMT.N and Costco Wholesale Corp. COST.O , are hurting its business. "Quite simply, our size combined with labor costs that are among the highest in our industry makes it difficult to compete with the low-cost operators in our markets," Chief Executive Robert Kelly said in a press statement. "Our cash constraints have made it increasingly difficult to service the company's high-yield debt obligations." Eagle and four units filed for protection from creditors with the U.S. Bankruptcy Court for the Northern District of Illinois in Chicago. The petitions were not immediately available. The company, founded by a 23-year-old Russian emigre named R. Tenenbom with a single 525-square-foot store in Davenport, Iowa, said the bankruptcy filing will not affect day-to-day operations. It said it will continue talks with its labor unions to renew and modify collective bargaining agreements, which it will continue to honor. Eagle runs 60 Eagle Country Markets and one Bogo's Food and Deals. It employs about 3,550 people. Its shares closed Friday in bulletin board trading at 22 cents.
In opinion, I wont be suprised if more food companies (ex. food lion and winne dixie in southeast) are not wiped out by walmart.
Yeah I agree, especially since Wal-Mart is test-marketing stand-alone grocery stores in FL and another state. Alot of places don't want the superstores or there isn't enough room for them (like the Northeast). So they've decided to try just building supermarkets instead of the Super Wal-Marts. And, they can keep the prices low because of the bulk buying that they have for Superstores.
WAL*MART caused it??? THAT IS AMAZING THAT THEY HAVE SO MUCH POWER... THE PROFIT MARGIN OF A GROCERY STORE IS LIKE LESS THAN 5% If the grocery stores have a good LOYAL customer base...they can SURVIVE
In my city we have ONE SUPER WAL*MART and my WAL*MART store...(SMALL) All the grocery stores in my county are either ADDING ON, OR ADDING NEW LOCATIONS... IF WAL*MART WAS GOING TO "KILL" THEM, WHY WOULD THEY DO THIS??? BIG K-MART IS STILL ALIVE HERE!!!
Re: Re: Eagle Food Centers Files for Chapte BKmart "is still alive" despite recently filing bankruptcy?
Re: Re: Eagle Food Centers Files for Chapte I used to live in Davenport and I am not surprised as their prices were outrageous!! Super Wal-Mart opened in Davenport last October. NV Bone Doc
Re: Re: Eagle Food Centers Files for Chapte I still MUST shop at grocery stores!!! SAFEWAY (VONS), KING SOOPERS (KROGER), ALBERTSONS. I can find MANY things at the GROCERY STORES that are cheaper than even WAL*MART!!! Many thing are NOT available at my WAL*MART anyway... The SUPER WAL*MART is too far...
Re: Re: Eagle Food Centers Files for Chapte I thought Eagles previously emerged from BK 2 years ago.... Grocery Stores still make more than 5% gross....back in my retail days I was a asst. produce manager for a small local chain called Wiseway (NW Indiana...) produce was marked up usually at least 40%, and our numbers were usually 31-34% in our department. I've also been in on the wholesale side of the grocery industry...was a produce inspector for three years....for Roundy's annual revenues of 5-6 Billion /yr.... FOB price of Bananas are only $6-7.50/cs 40lbs/cs actually the Roundy's warehouse that I was out of, was an old Eagle Foods warehouse located in Westville Indiana...they built the damn thing, was the most advanced grocery warehouse at the time, then decided not to use it, so it sat for 10+ years...Roundy's bought the whole complex with 80+ acres of land, 676,000 sq feet for something like 7-8 million..was a steal... The biggest problem with retailers/distrubution is this....you have a small local chain 2-9 stores...you want to renovate the stores; however you don't have the money, you borrow it from your distribution warehouse, sign a contract for 5-10 years stating that you will buy only from them, and you get the money....2 years later you cannot pay the loan back, so as a result the distribution warehouse gets the stores...seen it happen a lot.... PolarisA3
Re: Re: Eagle Food Centers Files fo they built one in salt lake city too. i cant stand walmart its so crowded. i buy most of my food at costco wholesale.
Re: Re: Eagle Food Centers Files fo I only grocery shop at Wal-Mart when I'm broke because I paid 2x per month so in the weeks when I don't get paid I shop at Wal-Mart. I like their kids clothes and the MaryKate & Ashley line. Their kids clothes are pretty decent and durable. (I have a 3 year old). I will be a lifelong patron of Publix. I LOVE Publix they have the very best grocery stores EVER. They really know how to build customer loyalty. The prices are higher sometimes but when I get paid we shop at Publix. Another thing, the SuperWalMart is always packed, we have this joke that they are giving stuff away for free!!
Re: Re: Re: Eagle Food Centers Files fo WHEN WE GET "SLAMMED" I SAY..."ALL-RIGHT...WHO PUT THE SIGN OUT FRONT THAT SAYS~~BUY ONE GET THREE FREE"????
