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Prices drop, labels change with grocery warehouse merger

Staff writer

The recent merger of two cooperative grocery distribution businesses that supply three county grocery stores seems to be garnering a favorable response from store owners and customers overall.

Affiliated Foods Midwest Cooperative, Inc., a retailer-owned cooperative that supplied more than 800 stores in 15 states including Carlsons’ Grocery, Dale’s Supermarket, and Peabody Market, merged with Associated Wholesale Grocers Inc., a cooperative that supplied more than 3,000 stores in 30 states.

Mike Crow, new owner of Peabody Market, decided to go with the merger about a month before it happened. He said the biggest benefit to customers was lower prices.

“People have really noticed that our prices have dropped,” Crow said. “The average amount of dollars spent at our store has gone up, which means people are starting to buy more groceries here because they don’t need to go to the big box stores and do bulk shopping.”

Crow said Peabody Market is starting to sell out of remaining Shurfine items.

“I’d say about 90 percent of customer comments have been good,” Crow said. “Maybe 10 percent have been bad.”

He said it’s encouraging to know his small town store can compete with big box stores on items like ground beef, which he recently sold for $1.99 per pound compared to Wal-Marts price of $2.35 per pound.

Greg Carlson, owner of Carlsons’ Grocery in Marion, has gone through several warehouse changes over the years. He said his store has not had a chance to retag items yet, so customers have not had a chance to notice the price drop.

“It’s felt a little like old hat,” Carlson said, “but I think the bottom line is that AWG has a little less selection but more of what they have, which means lower prices.”

Dale Franz, owner of Dale’s Supermarket, said prices have gone down considerably on many food items, but health and beauty items and other general merchandise had yet to go down.

“My hands are tied on some things because AWG is still working out some computer issues,” Franz said. “But they’ve told us they are doing a computer update in January or February, and more prices will drop then.”

However, he said fresh produce and meat prices have gone down a little, too, but some customers have also made comments about the store brand change.

“Some love the Best Choice brand other’s say they can’t stand it,” Franz said. “There’s really not much difference, if any. Some people just can’t stand certain labels for some reason.”

Franz and Carlson each noted milk as an example, stating that Best Choice and Shurfine milk were both bottled in the same plant but jugs were merely given different labels.

“Some grew up with Best Choice, and hadn’t seen it in 15 years,” Carlson said. “They were happy to see it come back, but there were a few who gave me an earful.”

Last modified Dec. 1, 2016

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