Loss of Farmer Jack would leave Toledo mostly to Kroger

1/13/2004

If Farmer Jack closes its six Toledo area stores, not only will it idle about 1,000 workers, it also will leave the city of Toledo almost completely in the hands of the Kroger Co.

With the loss last year of Food Town, the Detroit-based Farmer Jack chain was the only sizable grocery chain that had more than one store inside the Toledo limits.

Farmer Jack has three stores in Toledo and Kroger has eight. Farmer Jack has a 10.5 percent market share in the metro area, Kroger a 38 percent share, by far No. 1. Meijer, which is part grocery and part department store, has a store within Toledo. One of Churchill s two area stores is on Central Avenue in the city. Other local groceries are independents.

Farmer Jack, which has told the union representing local workers that it plans to close, sell, or convert its local stores soon, did not return phone calls yesterday. Shelves at some stores were not being restocked, although some fresh items such as milk were being restocked. Employees remain on edge.

The fallout from the area s intense grocery wars of the past few years is not surprising. Kroger could have a semblance of major chain competition if Farmer Jack s parent, the Great Atlantic & Pacific Tea Co., converts two or more of the six stores to its Food Basics discount grocery store format.

Kroger, which added to its local dominance last year by buying up some closed Food Town stores, still has keen competition in Toledo s immediate suburbs from other chains, such as Meijer and Giant Eagle.

<cc11p>The transformation has occurred in other markets, said Dave Long, a commercial real estate agent with CB Richard Ellis, Reichle Klein in Maumee.

“Most other markets are split up into two larger companies, and then the balance is independents and nonconventional stores like Aldi s,” he said.

Grocery industry experts have said a couple of the Toledo Farmer Jack stores - at 1707 Cherry St. near Bancroft Street and at 2630 West Laskey Rd. near Douglas Road, are in areas for which A&P s Food Basics concept might work. However, the no-frill stores generally are about half the size of the Farmer Jack stores, which would require the Toledo and area stores to be split.

Whether a Kroger competitor would gobble up some of the Farmer Jack stores if they were closed is unclear. Mr. Long said some of the locations are good, and the area has a trained work force.

The question is: Would somebody come in? That s still up in the air, he said.

It s not clear what fewer major competitors would mean to Toledo food shoppers other than that they might have farther to travel to get to a grocery store. Some experts don t think the hefty price discounting that has been ongoing for the last three years will end.