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The Oakland Tribune reports that Andronico’s, long considered to be one of the nation’s most progressive independent specialty food retailers but recently “hobbled by a cash crunch triggered by an aggressive store expansion,” has filed for bankruptcy protection and hopes to sell itself to private investors.

According to the story, “Andronico's said its seven stores will remain open and its 400 workers will stay on the job while the grocer attempts to work out its financial problems ... The 82-year-old regional grocery chain listed $10 million to $50 million in debts and the same range of assets, according to the Chapter 11 filing with the U.S. Bankruptcy Court in Oakland ... Andronico's is negotiating with Renovo Capital to obtain financing to keep operating during the bankruptcy proceeding. The grocer also is in talks for a sale to a private investor group.”

However, there is no guarantee at this moment that financing will be secured or a buyer found, in which case the ability of the chain to survive would be in doubt.

"This is a bittersweet moment in our history," Bill Andronico, CEO of the company, tells the Tribune. "We have struggled mightily to keep going, but the combination of the economic downturn and a broken balance sheet was too heavy a burden."

In addition to the economic downturn, Andronico’s also has been struggling to combat heightened competition in the San Francisco Bay Area, from the like of Safeway and Whole Foods as well as from players such as Sunflower Farmers Market, Sprouts Farmers Market, and Tesco’s Fresh & Easy Neighborhood Markets.
KC's View:
In some ways, this has been percolating for a long time; Andronico’s has closed three stores since 2004 as it tried to get its economic and competitive footing right.

That doesn’t make this story any easier to read or write. It is a shame when these things happen, especially to once vital retailers that at one point helped to define the progressive wing of the supermarket industry. There have been too many of these casualties in recent years, companies that used to be destination retailers not just for customers but for retailers from around the world looking to learn from the best, that have fallen on hard times.

Sure, it is survival of the fittest. Law of the jungle. But the industry is creatively diminished any time one of these companies fails.