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We are committed to customer satisfaction by well trained, dedicated associates in modern, clean and conveniently located supermarkets offering a complete variety of quality products at competitive prices.
Winn-Dixie Stores, Inc. is America's fifth-largest supermarket chain, the number one grocery chain in the Southeast, and the largest Florida-based public company. It operates nearly 1,200 stores--under the names of Winn-Dixie, Marketplace, Thriftway, and Buddies--in 14 states in the Southeast, the Midwest, and Texas. Winn-Dixie also runs 14 stores in the Bahamas under the City Market, Carroll's Food Store, and Winn-Dixie names. The company maintains 22 facilities to produce or process such products as soft drinks, grocery bags, frozen pizza, sausage, eggs and other dairy products, and detergent and soap. Averaging 38,800 square feet in size, Winn-Dixie's stores--many of which offer other services, such as a pharmacy, banking, photo processing, and dry cleaning&mdash--phasize low prices in their advertising.
Winn-Dixie's founder, William M. Davis, was the owner of an old-fashioned charge and deliver general store in Idaho before World War I. The advent of self-serve, cash and carry chain stores after the war drove many old-fashioned independent grocers out of business. Davis, however, saw the potential of this new kind of grocery store. He moved his family to Miami, Florida, and, borrowing $10,000, entered the self-serve grocery business. He bought his first store, the Rockmoor Grocery, in the Miami suburb of Lemon City in 1925. Davis, his wife, and their four sons ran the store; the Davis family has provided the leadership for Winn-Dixie ever since.
In the early years Davis found it difficult to expand. Three times he attempted to open a second store and three times the store failed. Chain stores had demonstrated their ability to deliver a wider variety of high-quality goods at lower prices than had ever before been possible, but many a tradition-bound consumer preferred the old way of doing business. Independent grocers had local support and political connections, but life could be made rather difficult for a chain-store or supermarket operator. After consumers' initial resistance was overcome, however, it was impossible to deny that supermarkets were the wave of the future. By 1934, the year W. M. Davis died, the Rockmoor Grocery had spawned 34 Table Supply Stores, as they were called, in South Florida.
Davis's four sons took control of the company at their father's death and set out on a course of further expansion. In 1939 they acquired control of the 78 stores of the Winn & Lovett Grocery Company of Florida and Georgia, and in 1944 the company established its headquarters in Jacksonville, Florida, and officially adopted the Winn & Lovett name.
The war years brought a lull in the supermarket industry. Food rationing, labor shortages, and price increases forced supermarkets to tighten their belts with the rest of the nation. Winn & Lovett, along with most of the supermarket industry, cooperated with the government by maintaining a lid on prices during and immediately following the war. During this time nonfood products filled what would otherwise have been empty shelves, and began to assume a more prominent place in supermarkets. The higher profit margins on nonfood products allowed supermarkets to maintain food prices at relatively low levels without jeopardizing overall profitability.
Merger with Dixie Home Stores in 1955 Created Winn-Dixie
Once the economy had returned to normal, Winn & Lovett picked up where it had left off before the war, adding, in 1955, several more grocery chains in Florida and the deep South to its company rolls. Later in the same year, Winn & Lovett merged with Dixie Home Stores of Greenville, South Carolina, and changed its name to Winn-Dixie Stores, Inc. With this merger, Winn-Dixie broke into the top 10 supermarket chains and from the mid-1950s through to the mid-1960s was the most profitable company in the industry. Profits in the supermarket industry are more dependent on high volume than high profit margins, but Winn-Dixie's profit margins in this period were exceptionally high. This was due to both an increase in sales (fourfold between 1954 and 1964) and lower labor costs in the nonunion South.
Winn-Dixie continued to expand and prosper in the 1960s, acquiring the Ketner and Milner Stores in the Carolinas and the Hill Stores in Louisiana and Alabama. Winn-Dixie not only acquired more retail outlets but also branched out into processing, manufacturing, and distribution, producing a wide variety of store brand products from these support facilities. With profits increasing each year and with 23 consecutive years of cash dividend increases, chairman J. E. Davis (one of W. M. Davis's sons) could confidently predict in the Wall Street Journal in 1966 that Winn-Dixie would shatter all previous sales and profit records in fiscal 1967.
The year 1966 also brought some bad news, however. The Federal Trade Commission had been investigating the increasing concentration in the supermarket industry and had concluded that mergers and acquisitions in the industry had unfairly limited competition, in violation of the Clayton Anti-Trust Act. Winn-Dixie, as the most profitable and one of the fastest-growing chains, was an obvious target. The investigation showed that, in fact, a third of Winn-Dixie's increase in sales over the previous 10 years had been generated by stores acquired during that period. As a result, the FTC ruled that for 10 years Winn-Dixie was forbidden to acquire any retail grocery stores in the United States without FTC approval. The ruling was not as much a punishment of Winn-Dixie as it was a settlement between the firm and the FTC. "The principal practical effect," Winn-Dixie President Bert L. Thomas told the Wall Street Journal at the time, "is to clear all Winn-Dixie's past mergers and acquisitions from future challenge." All that was required of Winn-Dixie was obedience to the ruling. Winn-Dixie used the 10-year period for "internal" expansion, adding stores by leasing new stores and improving existing retail and support facilities. Winn-Dixie did acquire 11 stores in the Bahamas which were not covered by the FTC order.
When the ban was lifted in 1976, Winn-Dixie acquired the 135 stores and the support facilities of Kimbell, Inc. in Texas, Oklahoma, and New Mexico. The stores in New Mexico, which were unionized, posed a problem for the traditionally nonunion Winn-Dixie. After the company refused to negotiate with the union and a pro-union boycott began, Winn-Dixie sold its New Mexico stores in 1979.
Reacted to Increased Competition in the 1980s
In 1983 J. E. Davis stepped down as chairman of Winn-Dixie, and a member of the third generation of the Davis family, Robert D. Davis, assumed control. Robert's five years at the helm were marked by a virtually flat rate of growth in gross profits, although net earnings did not suffer because of lower tax rates. Winn-Dixie has faced increasing competition in the 1980s, not only from its traditional competitors--the other large chains--but also from convenience stores, which have made a large dent in the market. In 1988 Robert stepped down as chairman (but remained vice chairman) and his cousin, A. Dano Davis, was elected to succeed him.
Dano Davis's new management team implemented measures to cut operating costs and raise gross profit margins. Management costs were also pared, and 60 management positions were eliminated. Winn-Dixie began selling off its smaller, less efficient stores and also unloaded some of its less productive baking facilities. The prevailing trend was toward larger, more modern stores offering more merchandise.
Despite these very positive moves, Winn-Dixie faced some problems in the late 1980s. It was notified by the EPA that it was a PRP (potentially responsible party) for the cleanup of two dumping grounds designated as "superfund sites" in Florida; the company estimated cleanup costs at about $200,000. Winn-Dixie also spearheaded a battle between grocery retailers and large producers of packaged goods over who would determine the shape of the market for retail food. Winn-Dixie announced in 1988 that it would no longer accept promotion allowances for products on a market by market basis, but only chainwide. Winn-Dixie demanded a consistent national pricing policy from major suppliers such as Campbell Soup, General Mills, Quaker, Procter & Gamble, and others. The companies initially refused to meet Winn-Dixie's demands and Winn-Dixie retaliated by dropping certain of their products from its inventory. According to Fortune, Winn-Dixie's crusade was a response to the declining profitability of the preceding five years. Winn-Dixie negotiated with each of the producers separately, hoping to solve the impasse and preserve its market position.
Emphasized Low Prices and Built Larger Stores in the 1990s
In January 1990 Winn-Dixie abandoned the acquisition of 24 B&B Cash Grocery Stores in the Tampa, Florida, area that had been announced the previous October. The Federal Trade Commission was concerned about the antitrust implications of the deal, which could have provided Winn-Dixie a virtual monopoly in a couple of southern Florida counties, and launched an investigation. The deal was called off when both parties became concerned about the cost of complying with the FTC's inquiry.
By the early 1990s, Winn-Dixie had essentially won the producers over to its position, a victory that was crucial to the company's emphasis on chainwide low prices that began in 1991. The chain aimed, and quickly became, the "low price leader" within the markets it served. Keeping prices low helped Winn-Dixie compete in the increasingly crowded markets it served.
That accomplished, Winn-Dixie next aimed to attain a further leg up on the competition by increasing the size of its stores. During the previous decade, the company had increased average store size from 22,000 square feet in 1982 to 30,000 square feet in 1989; it had also introduced larger, 44,000-square-foot "Marketplace" stores, which were grocery stores with the addition of such services as pharmacies and photofinishing. About 55 Marketplaces had been built by the end of the 1980s.
Starting in 1991, Winn-Dixie increased its store sizes even further, renovated or closed hundreds of its older and smaller stores, and altered the layout and conception of the Marketplace stores, some of which were as large as 55,000 square feet. By 1996, average store size was up to 38,800 square feet. Although Winn-Dixie did open a number of new stores during this period and also acquired in early 1995 the Thriftway Food Drug chain which had 25 units in the greater Cincinnati area, overall Winn-Dixie actually had fewer stores in its chain in 1996 (1,178) than in 1991 (1,207) thanks to the large number of older stores it closed. The company spent large sums of money on renovations and new store openings--$650 million in fiscal 1994 alone--and converted more and more of its stores to the new Marketplace design. By 1996 there were 504 Marketplaces in the chain (compared to 634 Winn-Dixies), and many of these larger format stores included a "Food Pavilion," which was a large single aisle featuring a bakery, produce, deli, a combination meat-seafood service area, and a sit-down eating area. The Food Pavilion was aimed to offer customers a convenient layout and more convenience food, especially targeted for the more time-stressed customer.
Despite the slight decrease in the number of stores chainwide, Winn-Dixie's combination of low prices and larger stores seemed to be paying off as sales increased from $10.34 billion in fiscal 1992 to $12.96 billion in fiscal 1996. During the same period, net earnings rose from $195.9 million to $255.6 million. Early results for fiscal 1997 were less promising and Winn-Dixie cut prices on more than 3,000 items in October 1996 in response to weak first quarter sales. Nevertheless, the overall picture at Winn-Dixie remained positive. Winn-Dixie had recorded more than 50 straight years of annual increases in cash dividends, as well as more than 60 consecutive years of sales increases. There was good reason to suspect that these streaks would continue well into the 21st century.
Principal Subsidiaries: Astor Products, Inc.; Deep South Products, Inc.; Dixie Packers, Inc.; Fairway Food Stores Co., Inc.; Monterey Canning Co.; W-D (Bahamas) Limited; Winn-Dixie Atlanta, Inc.; Winn-Dixie Charlotte, Inc.; Winn-Dixie Louisiana, Inc.; Winn-Dixie Midwest, Inc.; Winn-Dixie Montgomery, Inc.; Winn-Dixie Raleigh, Inc.; Winn-Dixie Texas, Inc.