Harris Teeter shoppers won’t notice immediate changes, as they head to their stores today. But at the corporate level, things are a whole lot different.
Kroger has officially completed its buyout of North Carolina-based Harris Teeter, adding 227 stores to what was already the largest grocery chain in the country. Kroger is thrilled, Harris Teeter seems happy, shareholders are counting their money – and that leaves shoppers, and employees, to worry about what might happen next.
“We are pleased that our merger is complete and look forward to bringing together the best of Kroger and Harris Teeter to benefit our customers, associates and shareholders,” Kroger CEO Rodney McMullen said in a news release today announcing the completed transaction. “Together, through our Customer First Strategy, we are going to be an outstanding combination.” Added Harris Teeter CEO Thomas Dickson, “We are excited that Kroger, one of the best food retailers in the U.S., has recognized the value in Harris Teeter.”
The good news is that no store closings are planned or expected, and no job losses are in the cards – other than at the top levels of Harris Teeter. CEO Dickson and chief financial officer John Woodlief are leaving, euphemistically, “to pursue other interests.”
That leaves Kroger squarely in charge of Harris Teeter now, though company officials say they likely have more to learn from Harris Teeter than Harris Teeter has to learn from Kroger. Harris Teeter is known for its more upscale stores, product selection and customer service – more so than Kroger – and Kroger execs say they’re looking forward to studying their new acquisition and possibly replicating their best practices in other Kroger-owned chains. “They do fresh better than us. They do very well in their customer scores,” Kroger’s McMullen told the Cincinnati Enquirer late last year. About Harris Teeter’s successful online-ordering-and-curbside-pickup program, he added, “I’d be shocked if we couldn’t do that at a significant number of stores.”
Harris Teeter shoppers, accustomed to their stores’ higher price tags, could also benefit from lower prices. Kroger expects the combined company could save up to $50 million a year by negotiating better prices from suppliers than the smaller Harris Teeter chain was able to do before.
But Harris Teeter’s higher regular prices are offset by much better sales and coupon deals than Kroger. And that’s the big concern among shoppers – that lower prices could end up meaning fewer perks. While Harris Teeter is known for its double coupons, Super Doubles and occasional triple coupon promotions, Kroger stores across the country have been slowly eliminating their longstanding double coupon policies.
Kroger insists that each individual division makes its own decisions about coupon policies, so in theory, it’s Harris Teeter’s own decision to make. Harris Teeter is reassuring shoppers that they “should expect no changes to their Harris Teeter stores… Harris Teeter customers will still be able to use their VIC cards (and) we do not currently have any plans to change our coupon policy.”
But as consumers well know, having “no plans at this time” to make changes does not necessarily mean that changes won’t happen over time. There’s no telling what Kroger’s ultimate influence might be. Before the merger was completed, Kroger wasn’t saying much about its specific plans for any changes at Harris Teeter. “Once this merger is complete and we actually have the ability to sit down with their management team and develop plans on how to run the company on a joint basis, we’ll make those decisions,” Kroger CFO Michael Schlotman told investors last year.
Among those who could really benefit from the combined company, are shoppers in states with few Kroger or Harris Teeter stores at all. For example, Harris Teeter has a single store in Florida. The deal could give Kroger the ability to expand its presence into the Sunshine State, currently dominated by its Southern rival Publix – just as Publix has begun expanding into Harris Teeter’s home state of North Carolina.
That would leave only the Northeast and parts of the Midwest where Kroger has no presence at all. But that could be only a matter of time. In its march to become a coast-to-coast company, chipping away at Walmart’s dominance in the grocery business, Kroger could already be eyeing other acquisitions.
For now, though, there’s a lot of work to do just bringing Harris Teeter into the fold. Shoppers can only hope the improvements and cost savings will benefit them – and not just Kroger.
1last thing. Publix is no threat to harris teeter,harris teeter is way better at everything&with better promos way cheaper. Publix is however a threat to kroger since they r the same. When a winner&looser merge u dont let the looser run the show. Since harris teeter is publixes biggest competition&publix is no threat to ht,kroger should copy harris teeter in everything,so publix wont bea threat to kroger either.that way publix cant compete with kroger either.
Oh if there is a q event ill find a way to go once or twice&find a way to fill up my cart.and go more often next month.if not ill go once a month like non couponers do. We do have blogs,groups&harris teeter fan clubs where we talk about all of this.
We shoppers knew from the start it wouldnt benefit us,but it would hurt us tremendously. The new lower prices were we can save a few pennys seem to have replaced the supperdoubles,tripples,buy2,get3free,el passo promos&other promos where we could save a whole lot of dollars,usually over$100&when even folks on fixed income could stack up and actually have food money left at the end of the month . Now tnx tolower prices &cancelling of promos i blew my whole budget&cant afford to shop there daily for a whole week during coupon events plus twice a week on other weeks filling one to 2 buggys full top&buttom each time i go. Im probably gonna try not to shop at ht for 2wks or longer,the lower prices by a few pennys r costing me too much in dollars,$200 more then im used to spending at harris teeter. Couponers which r hts most loyal customers have always been against the merger.