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Sweetbay to close a third of its underperforming Florida stores

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Published:   |   Updated: March 13, 2013 at 09:37 AM
TAMPA -

Sweetbay Supermarket will close 33 "underperforming" grocery stores from its total fleet of 105 stores in Florida – all of them closing by mid February.

Sweetbay's Belgian parent company Delhaize Group announced the news late Wednesday night as part of a broader reorganization plan aimed at improving the company's results in the United States.

The closures will mean layoffs for about 2,000 employees in Florida and changes for customers of the pharmacies at those stores.

"They are simply underperforming stores," said Sweetbay spokeswoman Nicole LeBeau. "Some of them, the leases were coming up, and just based on the sales of the stores they were selected."

The closures span the state and include both upscale and more low-income parts of Tampa, with six closing in Hillsborough County and 12 across Pinellas and Pasco counties. That also means the liquor stores and pharmacies attached to those stores will also close. For pharmacy customers, there will be instructions at the store about how their prescriptions can be transferred to other locations.

In Tampa, stores closing include:

As for what will become of the locations, Sweetbay rents all its store locations, so refilling the space with a new tenant will be up to the landlord or property owner.

Sweetbay is part of a collection of grocery brands owned by Delhaize that operates 3,400 stores in 11 countries. In the United States, that includes 1,500 stores under the brands Food Lion, Harvey's, Bottom Dollar, Reid's and Hannaford.

The grocery industry has notoriously narrow profit margins, and with 105 stores in Florida, Sweetbay faces competition from much larger rivals. Publix operates 1,066 stores in five states, and Walmart has taken large shares of the grocery market, while Target has also expanded to offer fresh groceries.

Under pressure, Winn-Dixie Stores filed for bankruptcy re-organization in 2005 and Albertson's closed dozens of stores in Florida in recent years, about 50 of which were adopted by Publix and re-branded to become Publix stores. Others were abandoned, including large stores like one at Waters Avenue and Dale Mabry Highway.

The "Sweetbay" brand has only been around since the mid-2000s, when the parent company started dropping the name "Kash N' Karry" from Florida stores, and finished the transition in August 2007.

Sweetbay worked to compete in part by launching a new private-label store brand called "My Essentials" in March 2011, with items like milk, eggs, sugar and bread matched to the lowest price offered by nearby rivals.

For pricing overall, Sweetbay is typically in the middle of the pack of five local grocery chains, including Walmart, Publix, Target and Winn-Dixie – with Walmart typically the least expensive and Winn-Dixie the most expensive, according to the Tribune's weekly Market Basket survey. (That survey does not calculate buy-one-get-one or club member discounts to reflect widely-available prices over time.)

There have been rumblings that a shakeup was on the way. Though rising somewhat in recent weeks, stock in Delhaize has lost more than half its value in the past two years, falling from almost $90 per share in May 2011 to close at $42.53 Wednesday.

Delhaize is set to release 2012 financial results early Thursday morning in Europe.

In just the last two weeks, Delhaize thinned and re-organized U.S. executive ranks. Mike Vail was moved from leader of the Sweetbay brand to become a supply chain executive for Delhaize America at the Food Lion headquarters in Salisbury, N.C.

Brad Wise, the former chief of human resources for Delhaize America became the new president of the Hannaford and Sweetbay brands – working from the Hannaford headquarters in Maine. In Florida, the leader for the Sweetbay operations will be Vice President of Retail Operations Eddie Garcia.


rmullins@tampatrib.com (813) 259-7919 Twitter: @DailyDeadline

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