Photo: FLLewis / Media City G — Haggen 3830 West Verdugo Avenue Burbank September 25,2015
The doors of the new Haggen grocery store are still open this weekend, but not for long. Last Thursday, the financially troubled grocer announced it was throwing in the towel on an ill-fated expansion plan and closing more than 75 stores in Arizona, Oregon, Washington, Nevada, and California — including the one in Burbank at 3830 West Verdugo Avenue.
Photo: FLLewis / Media City G — Produce department of Haggen store in 3800 block of West Verdugo Avenue, Burbank September 25, 2015
The West Verdugo store was converted from Albertsons to Haggen last April. Earlier, Albertsons merged with Safeway and the Federal Trade Commission ordered the sale of 168 stores to preserve competition in the marketplace. Haggen bought 146 stores last December. Apparently that was way to big a leap for Haggen, a small company based in Bellingham, Washington. Negative fallout from the deal resulted in Albertsons suing Haggen for $41 million and later, Haggen sued Albertsons for $1 billion. Also in the past few months, Haggen has shut stores, cut employee hours, and laid off hundreds. Then, two and half weeks ago, the grocery chain announced it had filed for bankruptcy under Chapter 11.
As part of that bankruptcy, Haggen is reorganizing around a core group of 38 profitable stores. In a news release last Thursday, Haggen announced employees in the jettisoned stores “… will receive 60 day notice of the pending store and office closures. During this process, all stores will remain open. Employees will continue to receive their pay and benefits through the normal course of business as previously approved by the court.”
I happened to walk out of Haggen in Burbank yesterday with a shopper pushing a cart with several bags of groceries. She knew about the store closing. She complimented the meat department, but said in general the store prices “were a little high.” The shopper had nothing but praise for the employees and hoped “they would be able to keep their jobs.” A decision by the Federal Trade Commission yesterday should give those employees more options. The FTC agreed to allow “… Albertsons to re-hire former employees without incurring “the risk of being accused of violating” its contract with Haggen.
Southern California is the largest, most profitable, and most competitive grocery market in the country. Several rival grocery companies are reportedly circling the stores Haggen has put up for sale. I hear Stater Brothers Markets, based in San Bernardino County, is among the potential buyers.
Photo: FLLewis / Media City G — Checkout inside Haggen at 3830 West Verdugo Avenue Burbank September 25, 2015
