Albertsons 2014 Annual Report Download - page 11

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The Company has established a network of strategically located distribution centers utilizing a multi-tiered
logistics system. The network includes facilities that carry slow turn or fast turn groceries, perishables, general
merchandise and home, health and beauty care products. The network is comprised of 17 distribution facilities,
nine of which supply the Company’s own stores in addition to stores of independent retail customers. Deliveries
to retail stores are made from the Company’s distribution centers by Company-owned trucks, third-party
independent trucking companies or customer-owned trucks. In addition, the Company provides certain
facilitative services between its independent retail customers and vendors related to products that are delivered
directly by suppliers to retail stores under programs established by the Company. These services include
sourcing, payment services, advertising and invoicing.
Save-A-Lot
The Company conducts its Save-A-Lot operations through a total of 1,330 stores under the Save-A-Lot banner,
including 948 licensed Save-A-Lot stores, located throughout the United States. The Company’s Save-A-Lot
operations are supplied by 16 dedicated distribution centers providing wholesale distribution to the Company’s
own stores and licensed stores. The Company owns 382 Save-A-Lot stores. Save-A-Lot is one of the nation’s
largest hard discount grocery retailers by store count. Save-A-Lot stores are typically about 15,000 square feet in
size and carry a specific assortment of high volume appropriately sized items largely focused on private label
products. During fiscal 2014, the Company added 40 Save-A-Lot stores through new store development,
comprised of 10 corporate-operated stores and 30 licensee-operated stores, and closed 41 Save-A-Lot stores, 40
of which were operated and closed by licensed operators.
Retail Food
The Company conducts its Retail Food continuing operations through a total of 190 stores located throughout the
United States. The Company’s Retail Food operations are supplied by one dedicated distribution center and nine
distribution centers that are part of the Independent Business segment providing wholesale distribution to both
the Company’s own stores and stores of independent retail customers.
The Company’s Retail Food stores range in size from approximately 40,000 to 60,000 square feet. The Company
operates its Retail Food operations under the Cub Foods, Shoppers Food & Pharmacy, Shop ’n Save, Farm Fresh
and Hornbacher’s banners. All of the Company’s retail banners have strong local and regional brand recognition
in the markets in which they operate. Cub Foods operates 44 wholly and majority owned stores, in addition to 24
franchised stores and stores in which the Company has a minority interest, primarily in the Minneapolis / St. Paul
market; the 56 Shoppers Food & Pharmacy stores operate in the Washington D.C. / Baltimore market; the 42
Shop ‘n Save stores operate in the St. Louis Market; the 42 Farm Fresh stores operate in the Virginia Beach,
Virginia market; and the 6 Hornbacher’s stores operate in the Fargo, North Dakota market. The Company’s
Retail Food stores provide an extensive grocery offering and, depending on size, a variety of additional products
including, general merchandise, home, health and beauty care and pharmacy.
Products
The Company offers a wide variety of nationally advertised brand name and private-label products, primarily
including grocery (both perishable and nonperishable), general merchandise and home, health and beauty care,
and pharmacy, which are sold through the Company’s owned and licensed Retail Food and Save-A-Lot stores to
shoppers and through its Independent Business segment to independent retail customers. The Company believes
that it has adequate and alternative sources of supply for most of its purchased products. The Company’s Net
sales include the product sales of the Company’s own stores, product sales to stores licensed by the Company and
product sales of the Company’s Independent Business segment to independent retail customers.
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