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NEW CUSTOMERS DRIVE AFS' SALES GAINS

SALT LAKE CITY (FNS) -- Being prepared for what turned out to be a "window of opportunity" from the closing of Fleming's Salt Lake City division last summer helped Associated Food Stores here achieve a 17% gain in consolidated sales for fiscal 2004."The windfall was accomplished because we were prepared," Rich Parkinson, president, said at the wholesaling cooperative's annual meeting here this month.With

SALT LAKE CITY (FNS) -- Being prepared for what turned out to be a "window of opportunity" from the closing of Fleming's Salt Lake City division last summer helped Associated Food Stores here achieve a 17% gain in consolidated sales for fiscal 2004.

"The windfall was accomplished because we were prepared," Rich Parkinson, president, said at the wholesaling cooperative's annual meeting here this month.

With the addition of about 25 former Fleming-supplied stores, Associated services about 420 member stores sized between 20,000 to 40,000 square feet, located in Utah, Idaho, Colorado, Wyoming and Montana. Associated also operates 23 corporate stores.

Parkinson later estimated that half of the $162 million volume gain could be attributed to the ex-Fleming stores. The other half was generated by the 11-store Salt Lake City-based Harmon's chain, which signed on just prior to Fleming's pullout last year, along with sales from 12 former Supervalu-supplied stores in Colorado that became members last fall after the Minneapolis-based wholesaler sold its Denver warehouse to Kroger.

Sales in fiscal 2004 totaled $1.4 billion. Included in this figure are corporate sales, which climbed 6.5% to $482 million from $452.6 million the previous year.

Retained earnings, which derive primarily from corporate stores, totaled $44.3 million, compared with $33.6 million at the end of fiscal 2003. Parkinson told members he would like to see this figure reach the $75 million mark within the next three or four years.

Goals for next year include the fine-tuning of logistical, administrative and financial systems, Parkinson said at the meeting. Associated also plans to streamline advertising into one companywide program.

Associated has identified more than 100 geographic market areas in hopes of pinpointing solutions to competitive conditions that may apply to as many retailers as possible. The company has also set up a prototype corporate Dan's store here as a laboratory where retailers can "see and touch" new strategies in practice.