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COST PLAN KEYS SUPERVALU BUDGET

MINNEAPOLIS -- Supervalu here last week released its fiscal 1996 capital budget, which reflects the importance of its new Supervalu Advantage program, designed to improve efficiencies and reduce costs in distribution. The budget has allocated $104 million for the re-engineering program, a major jump from the $9.3 million Supervalu spent on the Advantage project over the past year. Supervalu said it

MINNEAPOLIS -- Supervalu here last week released its fiscal 1996 capital budget, which reflects the importance of its new Supervalu Advantage program, designed to improve efficiencies and reduce costs in distribution. The budget has allocated $104 million for the re-engineering program, a major jump from the $9.3 million Supervalu spent on the Advantage project over the past year. Supervalu said it expects Advantage to begin contributing to earnings and cash flow in fiscal 1997. Supervalu's total capital budget for the year ending Feb. 24, 1996, will be approximately $500 million -- the same amount as the budget for fiscal 1995. Supervalu said it will allocate $32 million for 33 new corporate stores. That expenditure is about half the $62 million the company allocated for new corporate stores during the current year. A company official said Supervalu had reduced expansion on its Save-A-Lot limited assortment chain during the year when it acquired 30 Texas T stores. During the new fiscal year, Supervalu said, it hopes to open 20 Save-A-Lot units, five Cub Foods, one Shop 'N Save supercenter and one Bigg's superstore, with another six stores likely to begin construction during the year but not likely to open until fiscal 1997. If all units open as planned, Supervalu said it would end fiscal 1996 with about 119 Cub Foods and 562 Save-A-Lot stores. Besides the $104 million allocated to the Advantage project, the balance of Supervalu's budget includes $241 million for food distribution expenses, $142 million for retail capital expenditures and $13 million for computer-related expenses.

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