Grocery company will retain a "reasonable presence" here after headquarters move to Florida
MARCH 22, 2012 1:50 p.m. (0)
Beyond that, Bi-Lo’s purchase of the larger Winn-Dixie gives the combined company of 688 stores and 63,000 employees in eight southeastern states “more opportunity for growth and sharing of ideas than what Bi-Lo or Winn-Dixie could have done as individual companies,” he said. “Our plans are not to just stop with Winn-Dixie and Bi-Lo. We want to remodel stores, open new stores and possibly add to our structure as well.”
Byars said it is “totally impossible” at this early stage to determine how many corporate employees in Mauldin will be affected, but the company is committed to “a strong reasonable presence” in Greenville.
“While there could be some displaced employee jobs, there also could be a lot of new jobs that do not even exist today,” he said.
In addition to the 450 corporate positions that could be affected, Bi-Lo’s wholesaler and distributor, the independent C&S Wholesale Grocers, has two facilities in Mauldin that could be affected as the combined company looks for cost savings.
Winn-Dixie operates its own wholesale and distribution network, which creates a dual system for the combined company. That will not change for now, said Byars.
“Bi-Lo plans to continue our relationship with C&S Wholesalers as we are abiding by the contract that is in place. We have been very pleased with our relationship with C&S. As we move forward, evaluations will be done to determine opportunities that might exist.”
The merged supermarket company announced last week that the Winn-Dixie’s greater corporate resources and infrastructure and its more central location to the bigger market footprint of Winn-Dixie made Jacksonville a logical choice for basing the new company.
“Frankly, Winn-Dixie at one time had up to 1,200 stores and now is at roughly 482 and we are 206. It made more sense that that was an easier transition. That is one of the main reasons Jacksonville was chosen,” Byars said.
Both Florida and South Carolina offered incentives for the corporate location. The combined company accepted $6.6 million in taxpayer subsidies from Florida and Jacksonville. The total value of incentives offered to keep headquarters in Mauldin has not been revealed, although they were said to be generous.
“The thing I want your readers to know is that, No. 1, I am still running Bi-Lo. I have no intention of leaving Bi-Lo,” said Byars, a native of the area. “We have no intention of backing away from Greenville and Mauldin or anywhere else in the four states we serve.”
According to news reports from Jacksonville, at least 100 jobs with a pay scale averaging $84,000 annually will be added to Winn-Dixie’s existing corporate workforce of 900.
“We have started on the process to really determine what positions are available and who within our companies would be best to fill those, so there are opportunities for our people to transfer and for our people to be promoted,” Byars said.
Mark Hamstra, editor for retail and financial at the industry trade journal Supermarket News, said the “primary objective and one of the reasons supermarket companies like Bi-Lo and Winn-Dixie merge is to reduce their costs by eliminating redundant positions.
“They might not need two financial officers. They may not need two totally different payroll systems. As many of those things they can centralize in one location, the better off they will be in terms of their cost structure.”
Hamstra said everyone in the industry is waiting to see what the new company will do about centralizing the two distinctively different systems the two companies have of purchasing, warehousing and distributing. Bi-Lo uses a private vender, C&S, and Winn-Dixie does it in-house.
“I’ve talked to analysts who have speculated that it could go either way: Bi-Lo could end up being supplied at its locations by Winn-Dixie when their contract comes up with C&S, or it could go the other way with C&S taking on more responsibility for distributing to Winn-Dixie stores.”
In 2005, Bi-Lo sold its wholesale and distribution segment to C&S, which offered jobs to the 1,650 employees then working at three centers in Mauldin, Chattanooga, Tenn., and Birmingham, Tenn.
C&S, which is based in Keene, N.H., is the largest wholesale grocery distributor in the nation with annual revenue in excess of $20 billion. It is privately held.
In 2009, Lone Star, the private equity firm that owns Bi-Lo, took the company into bankruptcy for restructuring and debt reduction. It came out of bankruptcy in 2010.
The company remodeled three stores in 2010 and 23 last year and plans to do 30 to 40 next year. With each remodeled store, Bi-Lo has hired 25 to 50 more workers, Byars said.
Lone Star paid $590 million to acquire Winn-Dixie.
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