Europe Gains on U.S. in Productivity
New York City, According to a report from New York City-based The Conference Board, productivity growth in the United States has been driven largely by retail and wholesale industries. In fact, its comprehensive study, released today, shows that more than 50% of America’s productivity growth lead over Europe is due to gains in retail and wholesale trade.
However, Europe is gaining ground.
According to The Conference Board, the transformation of U.S. retailing from a low-tech industry to a sophisticated high-technology market force has been a major factor in the acceleration of U.S. productivity growth. Retail and wholesale trade firms have reaped significant productivity gains by relying on scale and scope, with massive centralized chains and increasingly large stores growing rapidly. New information and communication technologies and the organizational changes they support have produced new and better information about customers.
But despite its slower start, Europe has enormous potential to reduce the productivity gap in these sectors. Many European firms are applying the new technologies efficiently, operational regulations are easing within many countries and competitive incentives for change are increasing as obstacles to cross-border operations diminish.
The Conference Board study reveals that labor productivity growth among U.S. retail firms jumped to 7.4% between 1995 and 2002, up from 2.6% between 1980 and 1995. Wholesale trade firms showed productivity growth of 8.5% since 1995, compared with 4.1% from 1995 to 2002.
BI-LO and Bruno’s Cut Back Stores
New York City, Weighed down by pressure from Wal-Mart Stores and Publix Super Markets, Bruno’s Supermarkets plans to close 20 stores in March. Of the 20 stores on the list for closure, 13 are in Alabama, four are in Georgia, two are in Florida and one is in Mississippi. The company said the cutbacks allow the chain to weed out underperforming stores and improve its focus on more profitable markets. Demographic shifts and traffic patterns also factored into the decision.
BI-LO, which operates 282 supermarkets in the Carolinas, Georgia and Tennessee, on Tuesday announced plans to close nine of its locations.
The two chains were purchased by Lone Star Funds, a Dallas-based private investor, in a $660 million deal late last year. The two grocery chains, which combined have more than 400 stores in the Southeast, plan to merge their operations as BI-LO Holdings LLC, and relocate Bruno’s corporate offices to Mauldin, S.C.
Wal-Mart Contributes to College Fund
Bentonville, Ark., Wal-Mart Stores provided an award of $1.5 million to the United Negro College Fund (UNCF) that includes a $1 million grant to establish the Wal-Mart Emergency Assistance Fund and $500,000 in operating support for UNCF member schools.