AMERICAN STORES, KODAK DEVELOP 10-YEAR ACCORD

PETER MALBIN

SALT LAKE CITY -- American Stores Co. here has signed a 10-year agreement with Rochester, N.Y.-based Eastman Kodak Co. that allows Kodak, through its Qualex subsidiary, to be the exclusive supplier of photo-finishing services for the supermarket chain.

American Stores garners about $100 million annually in photo-finishing revenues at its 1,640 stores in 26 states, according to industry analysts.

Kodak beat rival Konica Corp. of Japan for the American Stores account. Before this agreement, which was signed Sept. 29, Kodak's Qualex unit had been providing wholesale photo-finishing services to 407 of American Stores' supermarkets, including Malvern, Pa.-based Acme Markets; San Leandro, Calif.-based Lucky northern California stores, and 30 drug store locations.

Photo-finishing for the remaining stores was done in-house at plants operated by the company in Elgin, Ill.; Braintree, Mass., and Burbank, Calif.

Now, Qualex will provide photo-finishing services for all American Stores' food and drug stores, as well as supply chemicals and paper to the retail chain's 175 in-store, one-hour photo-processing labs.

"Our agreement with Eastman Kodak ensures that we will continue to provide high-quality photo-processing service for our customers," said Victor L. Lund, chairman and chief executive officer of American Stores. "This gives us the opportunity to become strategic partners with the leader in an industry undergoing rapid technological changes," he said.