Giant Eagle Cuts 350 Jobs From Its Corporate Office

PITTSBURGH (KDKA) -- Saying it faces a challenging food retail climate, Giant Eagle has cut hundreds of employees in its corporate offices.

In a statement by Dan Donovan, director of corporate communications, Giant Eagle said, "Approximately 350 total positions have been eliminated as the company streamlines its corporate operations."

Giant Eagle says it's trying to relocate many of these employees.

None of the employees at Giant Eagle's 230 supermarkets or 220 GetGos are affected, union officials told KDKA money editor Jon Delano.

So what impact will the layoffs at these headquarter buildings have on local supermarkets?

One business professor said it could be positive, or then again, it could be negative.

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"On the one hand it could impact prices and result in lower prices in the store, which would be a good thing.  On the other hand, if it results in lower service in the store, then that's a real negative," said Prof. Jeff Inman of the University of Pittsburgh Katz Business School.

Inman says Giant Eagle's corporate cost-cutting may not be sufficient and closing unprofitable stores may be down the road.

"Stage one could be let's try to save costs by cutting corporate.  If that isn't sufficient, then stage two would be looking at the under-performing stores."

Giant Eagle operates primarily in Pennsylvania and Ohio with annual sales of over $9 billion.

But it has come under increasing pressure from national chains like Walmart, Costco, Aldi's and others.

Inman says the lay-offs could also make Giant Eagle more attractive for purchase by a larger chain like Kroger or Ahold.

"This would certainly make them a more attractive candidate if the balance sheet looks better," said Inman.

But the privately owned Giant Eagle says the lay-offs allows the company to "invest in our customers for years to come."