Retailer of the Year/Food Industry Hall of Fame

I’d be interested in your comments about the Amazon format, the grab-and-go stores that they have and the delivery systems now that are real popular.

Well, let’s go back to 2002. Safeway started a home delivery business on the West Coast—Seattle through California. Amazon started in about the same time, I don’t know exactly, with their home delivery business. Safeway’s has grown double-digits just about every year since then. So, we know how to run home delivery business and we’ve grown the hell out of it. Now we’ve expanded that business into other cities, and we are in 11 of the top 15 largest food markets in the U.S. with our own home delivery business. It’s a white-glove service; our employees will take your groceries right to your kitchen counter when you order from us. And we have 1,000 refrigerated trucks on the road. Freezers, refrigeration trucks that will deliver your product in really good quality. And we are doing other things now where we can drop it at the door if you want.

We also have Instacart in 2,000 stores, which is growing like crazy. So we are in the delivery business. I think we are well ahead of even Kroger in the delivery business. We are behind them in the drive up-andgo business. They took a different route. We are now ramping that up. We are planning to be in 500 stores by the end of the year.

So even though Amazon is here now, we’ve been developing that business for a long time and we feel good about where we are at. Amazon—people are like “wow, they are going to really be a factor”—well, there are 400 and something Whole Foods, and only 200 of them compete with us. I mean, we are not going to have a Whole Foods in Minot, North Dakota, that’s for sure. So, we have a lot of markets that we are not worrying about Amazon in.

Now, on the other hand, there are things in our stores that people are going to order from other stores just because it’s quick and easy. There’s no way you can ship one item overnight to get there the next day and make money, so I tell my wife, “if you want to order something from Amazon, the only way you can do it is if you order one item, make sure that they pay more shipping costs than the item retailed for.”

But they have unlimited resources. They are a different animal, so you can’t underestimate them. But I think brick and mortar is here to stay.

I agree.

Our job is to run better brick-and-mortar stores so customers want to shop with us. And segment our stores so we have the right thing in the neighborhood it’s in.

We are excited about El Rancho, a Hispanic format