Can Supervalu's New Strategies Overcome Market Challenges?
EDEN PRAIRIE, MN – Supervalu has been making a wide range of efforts to improve its performance, as it is committed to invest in business growth and improve EBITDA. Financial news publication Seeking Alpha suggests that Supervalu holds a promising position among leading grocers with its dedicated efforts to grow in an already highly saturated U.S. supermarket industry.
For example, the company's promotional and sales programs successes and effective operations are continuously growing its sales base, Seeking Alpha reports. Efforts to grow Supervalu’s Save-A-Lot stores have been ongoing and are now showing signs of success. The company reported +3.5% year-on-year growths in its Save-A-Lot sales. So far Supervalu has added 40 new Save-A-Lot stores, and expects to open an additional 65 new stores in FY15.
Supervalu’s management is also optimistic about lowering its cost structure. Many steps have been taken to get a leaner cost structure by the end of FY14. The recent quarter’s 6.4% year-on-year decrease in SG&A expenses was achieved partly through its cost reduction initiatives, Seeking Alpha reports.
While the company’s recent quarter’s -0.6% year-on-year decline in supply chain revenue may affect revenues in the short term, Supervalu plans to invest in the supply chain segment to make it more efficient to help bolster it for long term success.
With the company’s focused approach about cost reduction, margins are expected to scale up soon. Its future earnings may also get a lift from investments in revenue generating business segments.
Stay tuned to AndNowUKnow for more updates on its progress.