Penn Traffic: Difference between revisions

The '''Penn Traffic Company''' was founded in 1854 in [[Johnstown, Pennsylvania]], as a food service company for stagecoaches. It eventually became a general-merchandise department store but by the early 1960s had also returned to the food business through the acquisition of Super Value Corporation, operator of the 10-store Riverside [[supermarket]] chain. In 1982, the company sold its department stores and concentrated solely on the food and [[supermarket]] business. A series of financial troubles led to Penn Traffic's Chapter 11 bankruptcy filing in November 2009 and sale of assets to [[Tops Markets]] in early 2010.<ref>{{cite web |url=http://www.syracuse.com/news/index.ssf/2010/01/the_deal_is_done_tops_buys_pc.html |title=Tops Markets finalizes purchase of 79 Penn Traffic stores in New York and surrounding states |newspaper=[[Syracuse Post-Standard]] |date=January 29, 2010 |first=Charles |last=McChesney}}</ref>▼

At the time of sale, Penn Traffic was the [[parent company]] for 79 [[retail]] [[supermarket]]s in the [[Northeastern United States]], concentrating mostly in [[Central New York]]. Its headquarters were in [[Syracuse, New York]]. Penn Traffic formerly had operated supermarkets in Pennsylvania, Vermont and New Hampshire under the Insalaco's, Bi-Lo/Riverside/U-Save, P&C and [[Quality Markets|Quality]] trade names. The company had also operated a wholesale food distribution business (purchased in 2008 by [[C&S Wholesale Grocers]]) serving approximately 121 independent operators.▼

Penn Traffic traces its origins back to the 1850s, when it was a trading post in [[Johnstown, Pennsylvania|Johnstown]], [[Pennsylvania]]. Over the years, Penn Traffic evolved first into a general-merchandise department store and later a large [[retail]] and [[wholesale]] [[supermarket]] company. In 1922 it established Johnstown's first radio station, [[WTAC (Johnstown, Pennsylvania)|WTAC]],<ref>[https://babel.hathitrust.org/cgi/pt?id=hvd.hxhh8g&view=1up&seq=1259 "New stations"], ''Radio Service Bulletin'', December 1, 1922, page 3.</ref> which was licensed until early 1926.<ref>[https://babel.hathitrust.org/cgi/pt?id=uiug.30112106763060&view=1up&seq=257 "Strike out all particulars"], ''Radio Service Bulletin'', January 30, 1926, page 7.</ref> Riverside, founded in [[Brookville, Pennsylvania]] in 1928, became part of the Penn Traffic family in 1962, and began developing the Bi-Lo format in the 1980s (not related to the [[BI-LO (United States)|chain]] in the Mid-Atlantic). Penn Traffic operated 43 supermarkets under the Bi-Lo trade name across Pennsylvania, and also distributed food to 51 franchised and independent supermarkets from its [[DuBois, Pennsylvania]] distribution facility. Quality Markets, founded in [[Jamestown, New York|Jamestown]], [[New York (state)|New York]] in 1913, joined the Penn Traffic family in 1979. Penn Traffic operated a total of 34 supermarkets under the Quality trade name in southwestern New York and northwestern Pennsylvania.▼

Penn Traffic's flagship department store in Johnstown, challenged by economic decline, permanently closed after the [[1977]] flood. <ref>{{Cite web|url=https://www.tribdem.com/archives/1977-flood-devastated-local-economy/article_2621c508-6c46-5cea-a321-35663fb9aad6.html|title = 1977 Flood devastated local economy}}</ref> The company sold its six department stores and two women's specialty-store leases to Crown American Corporation, owner of the [[Hess's]] department store chain, in 1982 in order to concentrate on the [[supermarket]] business.▼

===P&C Foods===▼

P&C Foods began in 1944 as the Producers and Consumers food cooperative in [[Ithaca, New York]] as a way for farmers in [[Upstate New York]] to get their products to market efficiently. Until 2010, Penn Traffic operated 70 P&C supermarkets serving the Syracuse metropolitan area as well as many other communities in upstate New York, [[Vermont]], [[New Hampshire]] and Pennsylvania. P&C was also a major wholesaler in upstate New York; from its Syracuse warehouse, the company served 99 independent supermarkets in central New York, the majority of which still operate under the Big M franchise trade name. In 1997 a new ballpark for the [[Syracuse Chiefs]] opened. Penn Traffic owned the naming rights for nine baseball seasons of [[NBT Bank Stadium|P & C Stadium]]. The last 'P&C Foods' branded grocery store closed on January 21, 2012 in Bath, NY when the building was sold to Moran Foods, Owner of [[Save-A-Lot]] by order of the FTC.<ref>{{cite news |url=http://www.the-leader.com/x123110939/Save-A-Lot-owner-buys-Bath-P-C |title=Save-A-Lot owner buys Bath P&C |newspaper=[[Corning Leader]] |date=January 10, 2012 |first=Mary |last=Perham}}</ref>▼

===Big Bear===▼

When the first Big Bear store opened in 1933, it marked the beginning of self-service supermarket operations in the [[Midwest]]. Big Bear was the first supermarket in the country to use cashier-operated motorized [[conveyor belts]] and the first to use an [[IBM]] [[mainframe computer]]. In the 1980s, its Big Bear Plus stores combined a supermarket with a general merchandise store. Penn Traffic operated 70 Big Bear and Big Bear Plus stores in Ohio and West Virginia until early 2004. As a result of Penn Traffic's 2003 [[bankruptcy]] filing, these stores were either closed or sold to other companies, such as grocery retailer [[Giant Eagle]], while other properties were left vacant and still remain vacant. The Columbus, Ohio warehouses operated by Big Bear were also left vacant and subsequently torn down for redevelopment.▼

In the early and middle 1990s Penn Traffic continued to grow as it acquired and built other supermarkets in and near its primary markets. During this time, Penn Traffic entered the Buffalo and Erie markets with the Quality trade name and made substantial investments to enhance its store base and distribution network, while maintaining steady growth in cash flow and profitability.▼

As [[CEO]], Hawkins replaced USDA Choice meat in its butcher shops with a cheaper grade meat. In an effort to reposition its stores as focused on "value", rather than time-tested formulas within specific markets that had worked for the chains, Hawkins slashed expenses by using generic grocery bags, postponing store maintenance and reducing benefits to employees as well. In the Columbus market, prices did not uniformly drop and competitors like Kroger and Meijer regularly beat Big Bear in third-party cost comparisons. Customers noticed the changes, and unhappy with what they saw and were experiencing, stopped shopping.▼

Meanwhile, better-capitalized competitors like [[Wegmans]] Food Markets and [[Kroger]] cut into market share. Same-store sales fell 8.2% in fiscal 1998, while operating income declined another 6%, to $165 million. In Columbus, where Kroger and Big Bear had once been neck and neck, Big Bear's market share dropped to 20% from 25%, while Kroger's rose to 54% from 44% in 1998, according to a survey by the Columbus Dispatch. Hawkins resigned before the first bankruptcy filing, March 1, 1999.<ref name=forbes />▼

In December 2008 The Penn Traffic Company entered into a definitive agreement to sell its wholesale business segment to C&S Wholesale Grocers Inc.▼

On November 18, 2009, Penn Traffic filed for Chapter 11 bankruptcy protection after second-quarter losses of $7 million (the highest loss ever for the company), missed loan payments, and slower shipments from suppliers. Originally, the company intended to sell all of its assets by the end of 2009 and close on the deal or deals by the early January 2010.▼

As of January 9, 2010 Penn Traffic was entertaining 3 separate bids: $54 million from [[Price Chopper Supermarkets|Price Chopper]] for 22 P&C Foods stores, a private bid of $36.5 million from a team of professional liquidators for all of P&C's assets and $85 million from [[Tops Markets]] for all of Penn Traffic's stores.<ref>{{cite web |url=http://www.syracuse.com/news/index.ssf/2010/01/a_recap_and_more_news_penn_tra.html |title=Penn Traffic's bankruptcy case updated |newspaper=[[Syracuse Post-Standard]] |date=January 9, 2010 |first=Bob |last=Niedt}}</ref>▼