Penn Traffic
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The Penn Traffic Company operates 109 supermarkets in Pennsylvania, upstate New York, Vermont and New Hampshire. The Penn Traffic Company of today was built through the merger of three strong regional supermarket companies in the late 1980s, The Penn Traffic Company, P&C Foods and Big Bear Stores.
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[edit] Origins
Penn Traffic has its origins in the 1850s, when it was a trading post in Johnstown, Pennsylvania. Over the years, Penn Traffic evolved into a large retail and wholesale supermarket company. 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. Penn Traffic operates 43 supermarkets under the Bi-Lo trade name across Pennsylvania, and also distributes food to 51 franchise and independent supermarkets from its DuBois, Pennsylvania distribution facility. Quality Markets, founded in Jamestown, New York in 1913, joined the Penn Traffic family in 1979. Penn Traffic operates a total of 34 supermarkets under the Quality trade name in southwestern New York and northwestern Pennsylvania.
[edit] Acquisition
In 1988 Penn Traffic began an acquisition program. That year it purchased P&C Foods, a Syracuse-based supermarket company, more than doubling its size. 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. Today, Penn Traffic operates 70 P&C supermarkets serving the Syracuse metropolitan area as well as many other communities in upstate New York, Vermont, New Hampshire and Pennsylvania. Penn Traffic is also a major wholesaler in upstate New York; from its Syracuse warehouse, the Company serves 99 independent supermarkets in central New York, the majority of which operate under the Big M trade name.
[edit] Big Bear
In 1989, Penn Traffic purchased the Columbus, Ohio-based Big Bear Stores Company, which operated supermarkets and general merchandise stores in central Ohio and West Virginia. When the first Big Bear opened in 1934, it marked the beginning of self-service supermarketing 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. Big Bear has also been a pioneer in establishing supermarket service departments, developing a strong reputation for its high quality produce, meat, deli and bakery departments. Its Big Bear Plus stores were among the first superstores combining 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, when Penn Traffic sold or closed all the stores, due to mistakes Penn Traffic had made in running the chain. A few of the former Big Bear properties were sold to other companies, such as grocery retailer Giant Eagle, while many other properties were left vacant and still remain vacant.
[edit] Keeping Up
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.
[edit] Loss of Profit
In the late 1990s, Penn Traffic experienced a significant reduction in its profitability because of several merchandising and operational changes that had a negative impact on its business. By late 1998, the Company realized that while it had strong consumer franchises, it was working under an untenable debt burden. To address this challenge, in early 1999 Penn Traffic negotiated an agreement with bondholders to restructure more than $1.1 billion in bond debt. Penn Traffic completed its financial restructuring in June 1999 with more than 75% of its debt retired. The company has approximately 10,000 employees.
