Albertsons workers approve new contract
Denver Denver-area union workers for the Albertsons grocery chain have voted unanimously to ratify a new 52-month contract, according to the Denver Post on Friday.
Members of United Food and Commercial Workers Local 7 voted in meetings Thursday at the local’s headquarters in Wheat Ridge, Col. There were no votes to reject the contract, the UFCW said late Thursday in a posting on its Web site.
The contract includes a signing bonus, wage increases, improved healthcare insurance, a guaranteed severance package and provisions to stabilize the pension plan, union officials said. The amounts of the wage hikes and bonuses were not released.
“The workers run this union, and the Denver Albertsons workers told us they wanted to take the deal,” said new Local 7 President Kim Cordova, who took office Jan. 1.
Albertsons workers have been without a contract since May 2009.
Union Albertsons workers in the Colorado Springs area are voting on the contract Friday, and Grand Junction workers will vote Tuesday.
Albertsons stores in Colorado are operated by Albertson’s LLC. A separate set of Albertsons stores in other states are operated by Supervalu.
Local 7 represents about 17,000 workers at the Albertsons, King Soopers and Safeway stores in Colorado.
Sourcing strategy said to lower costs at Walmart
Improved speed to market, better product quality and reduced costs are the anticipated benefits of a new global sourcing organization that will be led by Ed Kolodzieski who was named EVP global sourcing for Walmart today.
Kolodzieski previously served as president and CEO of Walmart Japan, and in his new role he will report to Walmart vice chairman Eduardo Castro-Wright. Toru Noda, EVP and COO of Walmart Japan will assume Kolodzieski’s responsibilities and report to Scott Price, who joined Walmart last September as president and CEO of Walmart Asia with oversight of Japan, China and India.
The appointment of Kolodzieski is the next step in a revamp of Walmart’s global sourcing operations that began last fall when Castro-Wright announced a strategy to increase the company’s direct source and establish what Walmart calls, “Global Merchandising Centers,” which are intended to increase alignment between sourcing and merchandising.
“By realigning our resources, leveraging our scale, and restructuring our relationship with suppliers, we will enable our businesses around the world to offer even more competitive pricing on merchandise and to provide our customers a clear and compelling assortment of better quality products at lower prices,” said Castro-Wright.
The potential to reduce costs is thought to be huge given that Walmart says it spends more than $100 billion annually purchasing private brands. A portion of that amount, approximately $2 billion, will be managed by Li & Fung. The global supply chain and sourcing company will act as a buying agent for Walmart and rename an existing subsidiary WSG Pte. Ltd. to provide buying agency service exclusively to Walmart. As part of the arrangement, Walmart was granted a call option that it has the right to exercise after January 1, 2016 at an undisclosed price that would essentially transfer ownership of WSG to Walmart. The Li & Fung Group operates more than 80 offices globally and works with 15,000 suppliers to serve 2,000 customers.
Walmart unveils extensive restructuring
Bentonville, Ark. Major restructuring initiatives announced Thursday by Walmart touch nearly every aspect of the company and are intended to created a new organizational framework to drive growth.
The changes were announced in a series of memos posted on the company’s Web site from president and CEO Mike Duke, vice chairman Eduardo Castro-Wright, chief merchandising office John Fleming and coo Bill Simon. According to Castro-Wright, the changes were made because it was time to escalate efforts associated with the company’s Project Impact initiative begun approximately three years ago.
Although most generally associated with a new store prototype, Project Impact encompasses a wide range of initiatives to strengthen price leadership, improve product assortments and upgrade the shopping experience. Those benefits were realized in large part due to improve alignment among its merchandising, marketing and operations group. Now, a similar strategy is now being applied to the Walmart Realty division which will be integrated with store operations and logistics and report to Walmart U.S. COO Bill Simon.
“This move will help facilitate our growth as we seek to enter new markets and develop new segments across the U.S. and will drive efficiency by allowing us to better leverage our resources,” Castro-Wright said. “We are also building a structure that aligns the store planning team with the customer experience team that currently is part of merchandising. This will also support our efforts to accelerate our speed to market with new formats.”
In addition, the company plans to introduce a new field reporting structure that includes three geographic business units in the west, the south and the north. The company’s previous structure consisted of five major regions.
The shift has resulted in several interesting personal moves as Walmart.com president and CEO Raul Vasquez was given the role of an operator with oversight of the Walmart West area. Rosalind Brewer was name president of Walmart South after previously serving as president of Walmart’s southeast division. Hank Mullany, previously president of the Northeast division, is now president of Walmart North. Mike Moore and Michael Lewis, who previously served as senior VP under the five operating region structure, have been given new roles in the merchandising group. Moore is now responsible for automotive, stationery, hardware, fabric and crafts and sporting goods. Lewis will lead the newly created Global Merchandising Center for packaged grocery product.
Another major merchandising change involves Andrea Thomas who will serve as senior VP brand merchandising for home, hardlines and entertainment reporting directly to chief merchant John Fleming. Thomas was previously responsible for private brand management in the marketing group.
Another noteworthy change involves the creation of a new organization called store merchandising execution. It will be led by Andy Barron who has the tall order of designing merchandise strategies for the geographic business units, executing customer focused programs and will report to both Simon and Fleming.