Supervalu Looks to Save Millions on Bags

from Retail Wire - George Anderson, March 25th, 2011

It's no longer a question of paper or plastic at Supervalu. It's strictly plastic at the chain's stores unless customers bring their own bags or specifically request paper. Double bagging is also out. What this all comes down to is Supervalu looking at ways to cut costs -- an estimated $6 million a year if it applies a little discipline at the checkout.

"We're in a very competitive industry. Anything we can do to lower our expenses will help us keep our prices as fair as possible," Mike Siemienas, a spokesperson for Supervalu, told The Wall Street Journal.

According to the Journal, managers from Supervalu's nine chains review bagging figures on monthly conference calls. Cashiers and baggers in the Northwest all "take a 41-question quiz on bagging." The quiz has been made available for use across the country.

Supervalu has taken a number of steps under CEO Craig Herkert to improve its balance sheet and value proposition, including closing stores (Shaw's is probably the most high profile example), selling the Bristol Farms chain, engaging in SKU rationalization and focusing on opening more of its limited assortment Save-A-Lot stores. The company has taken these actions while enduring 11 straight quarters of declining same-store sales. Comp stores were down nearly five percent in the most recent quarter.

Seventy-five percent of respondents to a RetailWire survey on Feb. 3 thought it was "somewhat" or "very unlikely" that Supervalu's turnaround efforts would gain traction over the next year.