Competing grocery stores?

[zigzagzerr]

As I was following along on these developments at my local shopping center, it occurred to me that I've never seen this happen before anywhere else. How about you?


Shopping center is a couple blocks from our house. The Target store has recently put up signs that they are expanding their grocery selection to be one of those "Super Targets" with a full grocery store, and are taking over the space next door to them (which is a now defunct Linens N Things store). The planned opening is next month.

The interesting thing is that there is already a Safeway grocery store located in this same shopping center.

I would have thought there would be some sort of regulation imposed by an existing grocery store to preclude this from happening. No supermarket wants someone directly competing with them 3 doors down, do they?

The only situation I can think of that even comes close is a Costco and a Trader Joe's in the same complex, but they are such totally different kinds of stores. Doesn't seem like the same thing.

Anybody ever see this happen? Just struck me as odd.

 

[sue1013]

There used to be a Grand Union and Acme in the same shopping center by me for years. Newer grocery stores were built nearby and they closed. That same shopping center also had a Grants and Woolworths 3 stores away from each other both five and dimes.

 

[DMass]

We've got something similar in the next town over from us. Wal-mart wants to build another store(they already have one about 5 miles away in the same town) next to Market Basket which is the local favorite here. I think they want to put it out of business but it won't happen.

They've kept it in the courts for the past few years but I think Wal-mart has finally got the ok to build.

 

[FireDancer]

Sometimes "anchor stores" have clauses in their contract that forbid direct competitors from moving in. It makes sense for them but as far as the consumer goes it is a good thing to have competition that close. Of course it could just end in price collusion like when every gas station on the corner has the exact same price, but you can hope for the best.

 

[bicker]

No grocery store has any kind of legal protection against a competitor moving in next-door. As F said above, the only way you can get any buffer is to get an agreement with the landlord(s).

 

[sunnydoozer]

We have a mall nearby with a Wal-Mart and a Zellers. It would be akin to you having a Wal-Mart and a KMart in the same plaza.

When Wal-Mart put in the grocery section a couple of years ago a grocery store did make a big stink about it, even though they weren't anywhere near them. After the article ran in the paper an elderly gentleman wrote in a tongue in cheek letter, and reminded the paper that the very grocery store that was unhappy about the diversification sold patio furniture, children's clothes, pots and pans, dishes, flatware, bedsheets, towels, small kitchen appliances, televisions and VCR's, office supplies, personal grooming items, flower arrangements and photofinishing. If Wal-Mart couldn't sell food, then neither good the grocery store and then he'd have nowhere to buy groceries at all