The Vons Companies shares Southern California's crowded dinner table with some big and hungry rivals. The company has about 280 stores mostly in Southern California, which is also home to Ralphs and Food 4 Less (both owned by Kroger) and privately-held Stater Bros. stores. Its stores (also in Nevada) operate under the names Vons (traditional supermarkets) and Pavilions (upscale supermarkets). More than half of its supermarkets offer separate service departments for floral, bakery, and deli products, while some have full-service pharmacies and dry-cleaning departments. The company operates its own facilities for producing milk, ice cream, and baked goods. Safeway, a leading US grocery chain, owns Vons.
Caught between Wal-Mart Supercenters on the low end and Whole Foods Market on the pricey side, traditional grocery chains, including Vons, have begun reinventing themselves to maintain market share. To that end, Vons has been converting many of its stores in Orange County to its parent Safeway's Lifestyle format, which is designed to rival upscale chains by featuring expanded selections of perishable foods, organic products, and other high-end amenities. Also, in mid-2008 the grocery chain launched a new concept stores called The Market. The smaller stores measure about 15,000 square feet and offer a scaled down selection of groceries and plenty of ready-to eat foods. Vons competitors, including Tesco-owned Fresh & Easy markets, have been opening smaller format stores.
To pamper its customers Vons offers in-store banking facilities, one-hour photo labs, video rentals, and store-within-a-store restaurants in some supermarkets. Its roughly 30 Pavilions stores feature larger selections of meat, seafood, and wine (and even provide wine stewards). Pavilions also feature in-store Panda Express Chinese fast-food restaurants.
However, with the onset of the deep recession in the US, many Vons shoppers apparently are opting for low prices over amenities. As a result, the regional supermarket chain has seen its customer buying less, trading down to less expensive brands, and increasingly shopping at discounters, such as Wal-Mart Supercenters and limited assortment ALDI. While parent Safeway doesn't break out the performance of its individual grocery chains, its overall sales in the US fell by about 0.5% in 2010 vs. 2009. As Vons has struggled along with the Southern California economy, Safeway posted a huge impairment charge of about $1.8 billion in 2009 mostly to write down the value of Vons and its grocery stores in the eastern US due to the weak business climate. The company is pushing its private-label brand merchandise to lure budget conscious shoppers. Also Safeway, under pressure to match its rivals prices, in 2009 adopted an everyday pricing policy for some items: a move that pleases thrifty shoppers but puts pressure on store profits.
Like other Safeway-owned chains, Vons sells its parent company's lines of dairy products and other private-label merchandise under the Safeway SELECT, Signature, O Organics, and Rancher's Reserve brands, among others.
Vons.com offers online shopping and delivery services to customers in the San Gabriel Valley and is extending the service to other areas of Southern California and, most recently, to the Greater Las Vegas, Nevada, area. Vons.com is operated by GroceryWorks, which is owned by parent Safeway.