Wegmans freezes prices on 40 products

[Twisted Titan]

Price Controls are coming sooner rather then later

http://www.syracuse.com/news/index.ssf/2011/02/wegmans_freezes_prices_on_40_p.html


Wegmans Food Markets has announced that it won't raise prices on more than three dozen staple products.

The Rochester-based supermarket chain announced Tuesday that it will freeze the prices on 40 products, including fruit, vegetables, ground beef, pasta and coffee. Most of the items are the Wegmans brand.

The company says the price freeze will continue through the end of 2011.

Company Chief Executive Officer Danny Wegman says the move is in response to expected food price increases. Wegmans officials say the items chosen for the price freeze are products most families can't do without.

Wegmans operates 48 stores in New York and another 29 in Pennsylvania, New Jersey, Virginia and Maryland. The company plans to open its first store in Massachusetts later this year.

[Neuro]

I wonder if they bought options at the commodity exchange, to hedge this pledge? Or did they write long term contracts with their suppliers? The risk is that they won't have anything on their shelves if inflation really takes off. In the last years of Soviet Union farmers bought subsidized bread to give to pigs, because it was much cheaper than pig feed, but the bread shelves were empty for humans...

[Ash_Williams]

If it brings more people in the store the increased profits from other products will offset any loses.

If it doesn't, they'll just limit the supply of the wegman's brand of these products so that they sell out before 9:30 am.

[Spectrism]

I just got back from the future. Reading a business report on November 17, 2011:

Wegmans to close 15 stores and lay off half its work force stopping short of Chapter 11 filing. The federal government offered to provide the company enough support to keep necessary food suppliesq available in certain store areas. Wegman's was famous for holding prices stable but could not keep the policy in place in the face of rapid supplier price increases this year.

[Sparky]

Interesting development. It would be good to track this story. You can get a list of the price-frozen products, but I don't see a way to display the price:

http://www.wegmans.com/webapp/wcs/stores/servlet/ProductListView?langId=-1&storeId=10052&catalogId=10002&N=207&Nr=IsFamilyItem:TRUE

At the bottom is the notation: "* Purchase requirements may apply. Click product for details" But I couldn't find any details.

I must admit, that's a nicely designed web site for displaying inventory.