Why Safeway Needs a Future With Fewer Groceries

It’s been a rough week for U.S. retailers. RadioShack is going to shed as many as 1,100 stores, Staples plans to do without some 225 locations, and now Safeway’s merger with Albertsons is likely result is a slimming of the duo’s combined total of almost 2,500 supermarkets. All these businesses have their eyes on different role models for change: RadioShack wants to be more like the uncluttered Apple Store, Staples wants to capture some of Amazon.com’s online magic, and Safeway is heading down a path forged by Trader Joe’s.

That sort of change might have more to do with fewer items on than shelves than fewer stores. Robert Edwards, Safeway’s chief executive, vowed that deal would bring about a more “local, relevant assortment” in his stores as well as “an improved price/value proposition and a great shopping experience.” Edwards, who will run the combined chain, would be wise to focus sharply on simplicity and shift away from the grocery chain model of cramming 60,000 different products—or stock keeping units, in industry jargon—inside each location. A narrower list is smart strategy. Here’s why: