For some companies a major turning point signals decline — a CEO gets in hot water or auditors turn up an accounting scandal. But for Winn Dixie, it may be that consumers stopped paying attention. WalMart was cheaper and more upscale supermarkets chains sparkled like newly-minted dimes. Many Winn Dixie stores just languished, and in June, officials said “enough”.
“We had to look at where do we fall in market share and do we could increase it significantly, and if we didn?t feel that we could, for whatever reason, then the decision was made to just exit.”
That’s Joanne Gage, Winn Dixie’s vice president for marketing. She says the company considered many factors in deciding which stores to close including past sales, age of facility, lease terms, and location. Whatever the reason, Winn Dixie’s decision to shutter will leave holes in some communities. In Fairfield, west of Birmingham, one Winn Dixie store sits in the shadow of the U.S. Steel mill, one of only a handful still operating in a town that was once the Pittsburgh of the South. Shoppers outside the market say they’re going to miss it.
Woman Shopper #1 “It’s a shame, you know, they closing it and stuff, because a lot of elderly people still come up here.”
Woman Shopper #2 “I can go to Food World, but they high too, they prices pretty high.”
Man Shopper #1 “I’m gonna have to go to Walmart, start buying those, over there it costs too much. Don’t have that much money to go to Walmart.”
Woman Shopper #2 “If you do ride the bus you have to transfer downtown and then if you want to buy a whole lot of grocery you can’t do it because you on the bus and you can’t really carry them around.”
Jack Taylor is also lamenting the loss of so many Winn Dixie stores.
“Anytime that you have a situation like this somebody’s going to get hurt, some communities are going to get hurt.”
Taylor worked for the company as a young adult in Miami. Now he’s a retailing expert at Birmingham Southern College. He says the move makes sense.
“That’s going to result in some significant financial write-offs, but at the same token it’s going to hopefully slow the bleeding down to a manageable level. And possibly if they can sell some of those stores, which I think is in their plans, that will give them some cash infusion to offset some of the debt that they have.”
And, says Winn Dixie’s Joanne Gage, that cash can help address the image issue that has dogged the chain for years.
“The only way the company could ever have the capital now to reinvest in stores and upgrade image is to stop some of the bleeding, increase profitability and reinvest some of these funds into existing stores.”
Winn Dixie is already promoting its upgraded produce section, and the company known as “The Beef People” is also expanding its meat department to include veal, lamb and other high-end cuts.