San Francisco Safeway Inc. president and CEO Steve Burd said his company will rely more on providing "better everyday value" than promotional pricing over the next two years, according to the East Bay Business Times.
Speaking before the Bank of America 2008 Consumer Conference in New York Wednesday, Burd said cost reduction and process-improvement efforts will make it possible for Safeway to offer lower everyday prices.
Though he admitted sales events can drive traffic into Safeway stores, he added lower everyday prices on a wide range of items has been a goal since his company launched its lifestyle-store remodeling plan in 2005.
Burd also said he's not particularly worried about the entry of Tesco PLC into its home turf of California, where Safeway operates nearly 600 stores under the names Safeway, Vons and Pavilions. He said that each one of Tesco's Fresh & Easy Neighborhood Market stores that open within 1.5 miles of a Safeway has only 10% of the impact of the opening of another conventional supermarket.
Tesco has opened more than 50 Fresh & Easy stores in Southern California, as well as in the Las Vegas and Phoenix areas. It has announced the opening of 18 Bay Area stores by 2009, and another 19 in the Sacramento area.