Safeway Stores Inc. says it was only trying to operate more efficiently.
Instead, the company's attempt to revamp its local grocery distribution center in Landover has created major headaches.
Safeway stores around the Washington area have suffered major out-of-stock problems for the past 2 1/2 months as a result of the warehouse redesign. In reconfiguring the center this fall, some merchandise apparently was misplaced, making it difficult for Safeway employes to find merchandise ordered by local stores.
As a result, consumers in the District, Maryland and Virginia have reported increasing difficulties in recent weeks in finding all of the groceries they wanted at local Safeway stores. The surprise snowstorm last week aggravated the situation by delaying deliveries to some stores.
Yesterday, Safeway officials said the worst was over. The California-based chain said it has augmented the warehouse's normal work force of 150 with 120 employes diverted from other local operations to help restock the facility and to prepare deliveries.
"The problem has been fixed," said Safeway spokesman Larry Johnson. "It's a problem we inherited as a result of trying to improve a situation." The company is considering running advertisements apologizing to customers for any inconvenience, Johnson said.
"The timing may be the biggest mistake we made," he said. "We should have chosen a different time of the year. This time of the year, the tonnage is too high," in contrast with the spring and summer, when shoppers buy less.
According to Johnson, the Safeway center typically ships about 95 percent of the merchandise ordered by each store, depending on what's in stock. Because of problems created by the remodeling of the Landover warehouse, Safeway was meeting only 80 percent of a typical store's order, Johnson said. But some food industry officials, who declined to be identified, said that in some cases the shipment level has been even lower.
The warehouse remodeling was in part prompted by last year's $5.1 billion leveraged buyout by Safeway's management -- a buyout made to thwart a takeover bid by Washington's Haft family.
To pay for the buyout, Safeway has been selling or closing its marginal or unprofitable stores and consolidating operations.
In the restructuring, the number of Safeway stores in the Richmond area was cut in half, the company's Richmond distribution center was closed, and the Landover center began supplying the remaining Richmond stores. The Landover center then was revamped to make it better able to handle its increased duties.