NEW YORK -- Ralphs Grocery Co. would be willing to sell its northern California and Midwest units, George Golleher, chief executive officer of the Compton, Calif.-based chain, told an investors' conference here last week.
The two units account for combined sales of $558 million, or about 10% of Ralphs' total sales of $5.5 billion, he said.
"Those segments require little time and investment of resources, and they produce a good return on investment," Golleher said, "but they do not fit strategically into our business plans.
"So if an opportunity to divest one or the other comes along, we would obviously entertain that offer since those segments are not strategic to our core business."
Of more strategic concern, Golleher said, are plans to expand its two core businesses in southern California -- the conventional Ralphs stores and the Food 4 Less warehouse franchise.
"We see plenty of room to grow," he said -- with immediate growth concentrated on areas north of its Los Angeles base.
Golleher said the company has opened its first two Food 4 Less stores in Bakersfield, "and they are combining for $800,000-$900,000 a week and achieving a 20% share in that market, and we're looking for additional locations in Fresno and other locations north of Los Angeles."
Ralphs has also opened its northernmost store, in Santa Barbara, about 100 miles outside of Los Angeles, "and we have two more stores in development there," Golleher said.
Of Ralphs' 405 stores, the core group of 342 are in southern California, operating under the Ralphs and Food 4 Less names, with sales of $4.96 billion; 27 are in northern California, operating under the Cala, Bell and Foods Co. names, accounting for sales of $265 million, and 36 operate in Missouri and Kansas under the Food 4 Less name, with sales of $293 million.
The northern California and Midwest stores were part of Food 4 Less Supermarkets, the La Habra, Calif.-based chain that merged with Ralphs in June 1995 to create the current Ralphs Grocery Co.