NEWS WATCH: SUPERVALU TO REMAIN IN PACIFIC NORTHWEST...RALPHS TO CLOSE FIVE MORE CALIFORNIA STORES...L.A. GIVES PRELIMINARY OK TO SUPERCENTER LAW 2004-08-16 (2)

SUPERVALU TO REMAIN IN PACIFIC NORTHWEST

eek said it would resize its distribution center in Tacoma, Wash., but would remain in the region despite the loss of a major customer there. A spokeswoman for the wholesaler told SN yesterday that about 220 positions -- out of just over 500 total -- at the DC will be eliminated as a result of the loss of Bellingham, Wash.-based Haggen, which in June said it would join Associated Grocers of Seattle. The transition is slated to occur in mid-October. Supervalu, which serves military and independent customers from the facility, also operates DCs in Spokane, Wash., and Billings, Mont. Separately, Supervalu said it would cease operations at the Crestwood Bakery facility in Milwaukee that it took over last year through an asset swap with C&S Wholesale Grocers. Grebe's Bakery, West Allis, Wis., has acquired the rights to be the exclusive manufacturer and distributor of Crestwood Bakery products in Wisconsin and parts of Michigan and Illinois. Financial terms were not disclosed.

RALPHS TO CLOSE FIVE MORE CALIFORNIA STORES

COMPTON, Calif. -- Ralphs Supermarkets here said last week it plans to close five underperforming stores -- three in Southern California and two in central California -- over the next two months. The company said it will close stores in Long Beach, Moreno Valley and central Los Angeles on Sept. 19 and transfer all employees to other stores. However, when it closes stores in Fresno and nearby Clovis on Oct. 10, it will lay off the stores' 100 employees because the next nearest Ralphs location is more than 100 miles away, a chain spokesman told SN. Ralphs entered the Fresno-Clovis marketplace in 2001. The chain, a division of Cincinnati-based Kroger, closed 14 underperforming stores in June in the Los Angeles area.

L.A. GIVES PRELIMINARY OK TO SUPERCENTER LAW

LOS ANGELES -- The City Council here voted 12-1 last week in favor of an ordinance that would require an economic-impact analysis by developers of big-box stores exceeding 100,000 square feet before such projects could be approved -- a law purportedly aimed at Wal-Mart Stores, though the company is not named. The goal of the law is "to protect neighborhoods and [avoid] the impact of blight," Eric Garcetti, the councilman who introduced the ordinance, explained. A second formal reading of the ordinance to establish it as law is scheduled for this week. The law would exclude warehouse clubs "because people don't use them the same way they use supercenters," a spokesman for the City Council said.

KMART TO REDUCE HEADQUARTERS STAFF BY 10%

TROY, Mich. -- Kmart will lay off about 10% of the workforce, or about 200 jobs, at its headquarters here, the company said yesterday. "These changes better align corporate headquarters support with the improved field organization," the company said in a prepared statement. Separately, Kmart reduced the number of stores it previously said it had planned to sell to The Home Depot. The original agreement called for Kmart to sell up to 24 stores to the Atlanta-based, do-it-yourself retailer. However, last week Kmart said it has now agreed to sell "no fewer than 13 stores" for $173 million, and up to 19 stores for $288.5 million.

PEAPOD EXPANDS ONLINE GROCERY SERVICE TO BALTIMORE

CHICAGO -- Peapod.com here said it would launch its online grocery service this Tuesday in Baltimore and surrounding communities. Peapod, a division of Quincy, Mass.-based Ahold USA, is offering the service in association with Ahold's Landover, Md.-based Giant Food banner. Around 246,000 households in Baltimore and the surrounding communities of Owings Mills, Pikesville, Hunt Valley, Timonium, Towson and Mount Washington will be served from Peapod's distribution center in Gaithersburg, Md. Peapod already serves Montgomery County, Md., and the Washington, D.C., area.