Locals Back $1 Million Ad Campaign Against Carrefour

Posted: March 16, 1988

Twenty-five union locals from Washington to Boston joined yesterday with an area local pledging more than $1 million for an advertising campaign to persuade shoppers to boycott the Carrefour "hypermarket" that opened last month in Northeast Philadelphia.

The announcement came yesterday after 26 United Food and Commercial Workers union leaders met at the Trevose Hilton to discuss their strategy in fighting Carrefour, a French company employing non-union workers at Knights and Woodhaven Roads.

"We're dealing with a billion-dollar corporation," said Wendell W. Young 4th, the president of Local 1357, which represents 24,000 workers. "We just can't fight this outfit on our own."

The locals have already raised the money through dues increases and other sources and will pump it into an advertising blitz, according to union officials. The 26 locals, representing about 380,000 workers, plan to advertise in newspapers and on radio, television and billboards, and to establish phone banks to get their message to the public.

Carrefour spokesman Gary Lewi said the union campaign must prove to consumers that their money could be better spent elsewhere.

"Carrefour represents a concept of how to best serve the needs of today's consumer in terms of quality, pricing and convenience," said Lewi. "It should prove to be an interesting ad campaign."

Union leaders said they consider the store, which sells everything from baby cribs to copy machines, to be public enemy number one.

The discount store, which covers about 330,000 square feet, is the only Carrefour store in the U.S. The store can promote low prices because of its ability to purchase in quantity. It introduced the concept in France about 25 years ago.

Union officials said the store is "exploiting American workers" by paying lower wages and salaries. They said union workers earn about $9 an hour, while Carrefour workers earn less than $6 an hour.

Young, of Local 1357, said for unionized supermarkets, 12 cents of every

dollar earned goes for labor costs, while Carrefour will pay 5 cents of every

dollar for labor. "That's the bottom line," he said. "It's not fair."

Union officials also said the store elminates or reduces competition by cutting prices initially and raising them later. "It's predatory pricing," said Doug Dority, an international union vice president in charge of organizing. "Once stores close, you will notice prices inching up."

The Carrefour spokesman disputed the allegations.

"Our arrival ensures continued competition. There will not be a lack of competiton," said Lewi, who said the new store will force others to "look twice at the way they do business."

Union leaders said Carrefour's affects 25 supermarkets and an estimated 1,500 workers within a 10-mile radius of the store. Carrefour now employs more than 300 workers and eventually will employ nearly 500, according to company officials.

Union spokesmen dismissed the idea of trying to unionize Carrefour employees. "We would be organizing our own demise," said Young. "The idea of organizing is not in the picture."

Carrefour's arrival has forced the closure of one store and threatened the closure of at least three others, according to union officials.

The Shop 'n Bag on Street Road in Bensalem closed shortly after Carrefour opened, and three other Shop 'n Bag stores in the Northeast have notified the union of possible plans to shut down.

Those three stores are located in the Leo Mall, at Grant Avenue and Academy Road, and at Welsh Road and Roosevelt Boulevard. The supervisor of the three stores, Thomas Simkiss, had no comment yesterday and referred calls to Arnold Young, who owns all three and had owned the closed Shop 'n Bag in Bensalem.

Young could not be reached for comment late yesterday.

Shop 'n Bags stores are independently owned supermarkets supplied by the Frankford-Quaker Co.

Joseph Gilchrist, a Philadelphia supermarket consultant, said that Carrefour's opening has increased competition in the Northeast, forcing the larger chains such as Acme and Super Fresh to lower prices and step up advertising. He suggested that the independents such as Shop 'n Bag have been squeezed in the middle.

"I think Carrefour has had at least an indirect impact on these stores. It is almost as though these independents are the victims of the increased competitiveness caused by the opening of Carrefour," Gilchrist said.

Fearful of more closings and further expansion of the company beyond Philadelphia, union officials vow to maintain pressure.

"The real crux of the matter here is that the establishment of Carrefour will depress the conditions in the industry, and we're not prepared to let it happen here," said organizer Dority. "This is critical to us, and we will not fail."

Despite the union's planned efforts, Carrefour officials say they are not worried.

"America was founded on competition and free enterprise and that idea is working here," said Lewi. "The consumer will make the ultimate decision."

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