From the Cincinnati Business Courier:
“The CEO of Phoenix-based specialty grocery chain Sprouts Farmers Market Inc. is not too worried about the potential $24.6 billion merger of Kroger and Albertsons Cos. affecting his company, and he doesn’t know how much it’ll actually help the two large chains compete against Walmart.
“Sprouts CEO Jack Sinclair said his company operates on a completely different side of the grocery industry than downtown Cincinnati-based Kroger and Albertsons and their brands.
“I think it is neutral to us. If they drop the price of Tide or Coca-Cola it is not going to affect us. We don’t sell that anyway,” Sinclair said. “Maybe I’m a little bit naïve, but I don’t think it is going to bother us very much … I’m not sure putting two big things together to make a bigger thing, but still smaller than Walmart, is going to do anything. I don’t know how that unravels itself. There will be some efficiencies the customer gets, but it will still be more expensive than Walmart.”
KC’s View:
Maybe a little bit naïve, but basically he’s got it right – as long as Sprouts is selling something different, appealing to a different consumer mindset, then it is taking the best possible approach to competition.
By the way, Sinclair may be saying he’s not worried, but I’d be willing to bet that inside Sprouts, they;’ll be working overtime to emphasize and sharpen their competitive and differential advantages.
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