retail news in context, analysis with attitude

Western New York-based Tops Markets yesterday filed for bankruptcy protection.

According to the CNBC story, the company blamed “an unsustainable debt load, falling food prices and stiff competition from Amazon and other low-cost rivals.” Tops also said a heavily unionized workforce added to its woes.

CNBC writes that “Tops said it expects the 169 stores it operates in upstate New York, Pennsylvania and Vermont to remain open while it restructures under Chapter 11 of the U.S. bankruptcy code in White Plains, New York.” Tops says it had “$977 million of assets and $1.18 billion of liabilities as of Dec. 30, 2017, and employs more than 14,200 people.”

The story notes that “management acquired Tops in 2013 from Morgan Stanley's private equity arm, which had bought the company six years earlier from the Dutch retailer now known as Koninklijke Ahold Delhaize NV. In a court filing, Tops said ‘transactions undertaken by prior ownership’ left it with unsustainable leverage.”

CEO Frank Curci said that the company is “now undertaking a financial restructuring, through which we expect to substantially reduce our debt and achieve long-term financial flexibility. This will enable us to invest further in our stores, create an even more exceptional shopping experience for our customers and compete more effectively in today’s highly competitive and evolving market.”
KC's View:
That’s exactly what Tops has to do - figure out a way to create in its stores an exceptional, transformative, compelling experience that meets the needs and demands of the modern customer. Competition is a reality, and Tops has to define itself and its differential advantages in the marketplace.

But this can’t just be talk. It has to be matched with action … real action, that tries new things, that takes big swings and lays down bunts, that takes risks and makes mistakes, but that moves steadily, progressively forward.

Or die.