"Combine and conquer" is the motto at BI-LO Holding. The newly-formed parent company for the BI-LO and Winn-Dixie supermarket chains boasts about 690 stores across eight southeastern states. The BI-LO supermarket chain operates more than 200 BI-LO and Super BI-LO grocery stores in the Carolinas, Georgia, and Tennessee. Winn-Dixie operates about 480 combination food and drug stores in Alabama, Florida, Georgia, Louisiana, and Mississippi under the Winn-Dixie and Winn-Dixie Marketplace banners. BI-LO Holding was formed in 2012 when BI-LO's owner, Dallas-based investment firm Lone Star Funds, acquired Winn-Dixie for about $560 million and merged the two companies.
The March 2012 buyout of Winn-Dixie by Lone Star and its merger with BI-LO, joined two of the South's mainstay regional supermarket chains, and expanded their scale with no geographic overlap. Post merger, BI-LO Holding will move its headquarters to Jacksonville, Florida, home of Winn-Dixie. Jacksonville is centrally located to serve BI-LO's eight-state operating area.
The BI-LO chain rang up an estimated $2.8 billion in sales in 2011, while Winn-Dixie's sales topped $6.8 billion. Combined the two companies are projected to have about $10 billion in annual sales, making BI-LO Holding one of the nation's top grocery store operators.
The company's strategy is to realize efficiencies from the combined operation of the two chains, although BI-LO and Winn-Dixie continue to operate under their own banners. Functions, including supply chain, human resources, and store support, will be combined, as will the corporate headquarters. Prior to their merger, both BI-LO and Winn-Dixie struggled to return to profitability, after both pursued bankruptcy protection. BI-LO emerged in 2010 after 13 months under Chapter 11 reorganization, armed with a five-year plan to become more competitive. Part of its turnaround plan includes newer, larger Super BI-LO stores (launched in 2005). The 58,000 sq. ft. stores boast expanded products selections, including plenty of organic and natural foods. The grocer has opened more than 15 Super BI-LO stores and is gradually converting traditional BI-LO stores to the Super BI-LO format. Despite their new heft, both companies face many challenges in an intensely competitive grocery market. Differentiating themselves from competitors is among the more daunting. Like many conventional supermarket chains, BI-LO is sandwiched between upscale grocery chains (including Whole Foods) at the high end of the market and deep discounters, including Wal-Mart Supercenters. at the low end. – less