Kroger and Albertsons have argued that their planned $24.6 billion merger will bring lower prices for customers.
That's something the federal government and several states have rejected. The Federal Trade Commission, which appears to be unaware that Walmart (WMT) Aim (TGT) and Amazon (AMZN) exists, has sued to block the merger because it believes combining the two large supermarket chains would lead to higher prices for consumers.
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“The proposed deal will eliminate fierce competition between Kroger and Albertsons, resulting in higher prices on food and other essential household items for millions of Americans. The loss of competition will also lead to lower quality products and services, while reducing consumers' choices about where to buy food,” the FTC shared on its website.
Additionally, the federal agency says the merger would also be detrimental to workers.
“For thousands of grocery workers, Kroger's proposed acquisition of Albertsons would immediately erase aggressive competition for workers, threatening employees' ability to earn higher wages, better benefits and better working conditions,” the company added. FTC.
This is an argument that, although technically true, does not seem to recognize that people can buy food in places other than traditional supermarkets. The average American, for example, lives within 10 miles of a Walmart and approximately 75% live within 5 miles of a Dollar General.
With the merger under intense scrutiny, Albertsons (ACI) has joined Kroger (K.R.) by offering a new benefit to customers, courtesy of a company owned by Shark Tank star and serial entrepreneur Mark Cuban.
Albertsons now accepts Cost Plus cards
Mark Cuban's Cost Plus Drugs has a simple mission. Its goal is to reduce the prices of popular medications. He does this by trading large supplies of various medications and then following a simple system to sell them to customers.
“Every product we sell is priced exactly the same: our cost plus 15%, plus the pharmacy fee, if applicable. When you get your medication from Cost Plus Drug Co., you'll always know exactly how we arrived at the price. You pay. And as we grow and our costs go down, we'll always pass those savings on to you,” the company shared on its website.
Kroger has been accepting the Cost Plus card at its pharmacies for months and Albertsons has now signed up as well. The pharmaceutical company shared how the process works on its LinkedIn page. Cost Plus calls its local pickup card the Team Cuban card, which is free for anyone who signs up.
- Register and find nearby pharmacies – https://lnkd.in/gSq6Sjfb
- Search available medications – https://lnkd.in/gDFSr7qi
- Download your card (download link will be emailed to you within 48 hours)
- Ask your doctor to send your prescription to an affiliated pharmacy.
- Show your Team Cuban card when you pick up your prescription!
Both chains' pharmacies charge an $8 processing fee, which they keep.
“The Team Cuban Card is not a discount card, it is a benefit card that can only be used at Cost Plus Drugs affiliated pharmacies. Each Team Cuban Card is linked to an individual user with a unique identification number,” the company added.
Kroger and Albertsons face hurdles to merger
Kroger has made it clear that it believes the merger will be good for customers of both chains.
“Albertsons Cos. brings a complementary footprint and operates in several parts of the country with very few, if any, Kroger stores. This merger furthers our commitment to building a more equitable and sustainable food system by expanding our footprint into new geographies to serve more parts of with fresh, affordable food,” said Kroger CEO Rodney McMullen, who will retain that position at the combined chain.
The FTC disagrees, and the federal agency is unimpressed with the company's offer to sell some stores on behalf of competitors.
“The FTC's administrative complaint alleges that Kroger and Albertsons' inadequate divestiture proposal is a hodgepodge of stores, banners, brands and other unconnected assets that Kroger's antitrust attorneys have cobbled together and falls far short of mitigating lost competition between Kroger and Albertsons,” the shared agency.
If the merger is completed, Kroger and Albertsons would operate more than 5,000 stores and approximately 4,000 retail pharmacies and employ nearly 700,000 employees in 48 states. Walmart has 1.6 million employees in the US, while Target has approximately 400,000 and Dollar General (Managing Director) It has more than 170,000.
Publix, a regional supermarket chain that would be a major competitor to the Kroger and Albertsons combiner, has more than 250,000 workers.
