Save Mart Eyes More Cutbacks

ELLIOT ZWIEBACH

MODESTO, Calif. — Save Mart Supermarkets here will continue to do what it feels is necessary to maintain its financial health, including looking at possible downsizing of its store base and store personnel, a company spokeswoman told SN last week after the company said it would eliminate 36 positions.

“Everything is being looked at, and everything is being considered,” Alicia Rockwell, director of public affairs and communications, said — “though when, where and to what extent, we don't know.”

The company is financially stable, she added. “Bob Piccinini [chairman and chief executive officer] made that very clear in a senior management meeting,” Rockwell said. “We are doing well financially, but we had to make some changes to maintain that stability.”

Save Mart operates 244 stores in Northern California and Northern Nevada, with estimated sales of $4.9 billion. It acquired 132 stores from Albertsons LLC early in 2007 — a move that doubled the chain's store count from 124 to 256.

Just prior to the Labor Day weekend Save Mart said it was restructuring top-level management and also eliminating 36 positions at all levels of the company. Rockwell told SN the cutbacks included six vice presidents, though she declined to name them.

In March 2009, Save Mart cut 40 corporate and support positions to eliminate redundancies resulting from the Albertsons acquisition — the first layoffs in Save Mart's history. At the same time, the company also trimmed employee hours at stores where sales were weak.

The recent organizational restructuring involved the appointment of Frank Capps to the newly created post of executive vice president and chief sales officer, with responsibilities for overseeing marketing, merchandising and operations.

Capps will report to Steve Junquiero, president and chief operating officer, as will four other executives: Mike Silveira, executive vice president and chief administrative officer; Dan Miller, vice president, SMART transport; Ray Agah, vice president, engineering and construction; and John Davis, executive director of distribution.

The restructuring reduces the number of managers reporting to Junquiero by at least half, Rockwell pointed out. Junquiero will continue to report to Piccinini.

The company's actions are related to the economy and the normal process that takes place after a major acquisition, Rockwell said.

“When we did the acquisition, we took all the Albertsons people because we needed to make sure we understood what it would take to run the new company,” Rockwell explained. “We were learning as we went because we wanted to make sure whatever we did had the least impact on store-level operations while providing what the customers needed.”

Save Mart has spent the last three years working on several fronts to integrate the company, including stores, technology, distribution and corporate support, “and this rebalancing and restructuring is part of that ongoing post-acquisition process,” she said.

Rockwell said it was inevitable Save Mart would get to a point where it would have to make some cutbacks, “and if the economy were better, we might have been able to continue as we were for a longer period. Our efforts going forward are aimed at being more efficient.”

Asked whether Save Mart is considering additional cutbacks or possible store closings, Rockwell said, “Anything that allows the company to maintain its financial stability is being considered.”

In a press statement Junquiero said, “Forces beyond the acquisition have dictated that we continue the analysis and review of our organizational structure. Specifically, the continued depressed state of the economy has compelled Save Mart to look for further ways to reduce costs so that it may answer the call of the changed consumer and meet his or her demands.

“These changes support the company's continued efforts to strengthen its position in the marketplace and enhance operational efficiency for future growth.”

The announcement of the personnel cutbacks and organizational restructuring was made to senior management at an off-site meeting the Friday before Labor Day. At the same time the company sent emails to personnel at its two corporate offices and three distribution centers to inform them of the changes, Rockwell said.

Save Mart also sent designated people to each facility to walk around and answer employee questions, she added.