PLEASANTON, Calif. — Safeway is glad it's made the price investment it did — it only wishes it had done so earlier. That's what Steve Burd, chairman, president and chief executive officer, told the chain's annual meeting here this week.
"We knew we needed to make that investment,” he said. “While we would prefer to have done it before the economic downturn, we didn't have that luxury.”
Burd acknowledged late last month, at the time the chain reported first-quarter financial results, that “aggressive promotional investments” in February — which analysts said cost the company $35 million - did not produce the kind of returns Safeway had hoped for. "Consumers were not inventorying product,” Burd said at the time. “We were trying to put more items in the basket, and it just didn't happen.”
Asked by a shareholder what he considered his biggest challenges, Burd replied, “Sales, sales and sales. In this environment that's the biggest challenge. “We don't like this business downturn and the softer results, but we're in a unique position to react. As the business cycle corrects itself, we will be in a strong position to take market share this year, and with 2010 back to a normal economy, we look forward to being in the winners' circle then and to great years after that.”
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