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Giant Eagle grocery chain lays off 75 workers

| Thursday, Feb. 21, 2013, 1:42 p.m.

Giant Eagle Inc. is laying off 75 full- and part-time workers as part of efforts to trim costs.

The Pittsburgh area's largest grocery chain said on Thursday that it's cutting a variety of corporate positions at all levels, and nearly all at the O'Hara headquarters. Some jobs are being eliminated in offices in the Cleveland area.

Spokesman Rob Borella said Giant Eagle “identified areas where we could restructure the business so that we could become more efficient.” The company continuously does this, he said, though not all moves result in layoffs.

Most of the layoffs are effective immediately, the company said.

Giant Eagle's latest cost-cutting effort occurs amid traditional grocers' moves nationwide to combat market share loss to several types of competitors.

Grocery stores maintained 46.7 percent of retail food sales in 2011, the same level as in 2010, according to market research firm Willard Bishop of Barrington, Ill., but they have struggled to rebound from the recession as shoppers spend less and seek lower prices.

Sales at supermarkets and other traditional food stores are forecast to fall 1.4 percent by 2016, while supercenters such as those Wal-Mart operates, plus wholesale clubs, convenience stores, pharmacies and other formats make gains, the firm said.

Giant Eagle also cut about 81 management, administrative and clerical positions at its headquarters in September 2009.

The company employs 36,000 people in Western Pennsylvania, Ohio, West Virginia and Maryland, including about 11,000 in the southwest corner of Pennsylvania.

The privately owned company, with 229 supermarkets and 187 GetGo gas and convenience stores, had $9.9 billion in sales for the year ended June 30 compared with $9.3 billion the previous year.

“Giant Eagle is a great operator” whose stores do well in selling meats, produce and dairy along with items in the center aisles, said Paul Weitzel, Willard Bishop's managing partner.

He does not see layoffs as an industry trend.

“It's like any business in this economy. Everybody is trying to make things work,” Weitzel said.

Giant Eagle's laid-off employees will get severance and outplacement services, Borella said.

In mid-January, a promotion that offered free diabetes prescription medications and antibiotics was canceled at in-store pharmacies, with Giant Eagle citing rising drug costs.

The company in recent weeks also ended its foodperks! grocery savings plan tied to gasoline purchases and replaced it with another deal: 3 cents off a gallon of fuel when customers scan their Advantage loyalty cards at GetGo pumps. The new discount does not apply if fuelperks! earned through grocery purchases are being redeemed.

Giant Eagle also is moving into its own discount concept to rival growth by Bottom Dollar Food, Aldi and other limited assortment low-price food retailers. It opened Good Cents Grocery + More in Ross in November and expects to rebrand its Valu King stores elsewhere to that name.

Kim Leonard is a staff writer for Trib Total Media. She can be reached at 412-380-5606 or kleonard@tribweb.com.

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