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LARRY EDELMAN | TALKING POINTS AM

The cost of the Stop & Stop strike: as much as $10 million a day

At Stop & Shop on Watertown Street,  Nathan Ely, 11, stood on a column outside the entrance. His father, Christian Ely, is the produce manager. He came out to support his dad and is on school vacation this week.
At Stop & Shop on Watertown Street, Nathan Ely, 11, stood on a column outside the entrance. His father, Christian Ely, is the produce manager. He came out to support his dad and is on school vacation this week. (John Tlumacki/Globe Staff)

Now we know how much the strike by Stop & Shop workers cost Ahold Delhaize, the chain’s Dutch parent company: as much as $10 million a day.

Ahold Delhaize says the 11-day walkout, which ended Sunday, would cut operating profit by $90 million to $110 million in the second quarter. The losses were caused by lower sales, perishable inventory, and “additional supply chain expenses,” the company said in a statement Tuesday.

The strike crippled New England’s largest grocery chain — closing dozens of locations, delaying food from reaching stores, and keeping away loyal shoppers in large numbers. Many stores were ghost towns, with largely empty parking lots; deli and bakery counters were dark, and mostly bare, and produce bins were empty. Deliveries were delayed, with union drivers refusing to cross picket lines and striking workers blocking the paths of trucks.

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Shoppers were also reluctant to cross picket lines; many apparently took their business to nearby competitors. In the first few days of the strike, visits to the grocery chain by regular customers dropped 75 percent, compared with the previous weekend, according to an analysis of mobile device data by Skyhook, a location technology and intelligence company in Boston.

The big risk for Stop & Shop now is whether those customers will return. Grocery industry experts have told the Globe that customers who defect to a competitor often do not return to their original stores. For now, Stop & Shop has begun to restock the 246 stores that were affected by the strike and has warned customers to expect “limited service and product selection” for several days, extending the risk of customers staying away.

Meanwhile, the 31,000 members of the United Food & Commercial Workers union who went on strike are expected to vote this week on a pact that would provide raises to current workers, increase pension contributions for full-timers, and maintain the current contributions for part-timers. However, new part-time workers would get lower pension contributions and would not be guaranteed time-and-a-half pay on Sundays and holidays during their first three years of employment — a significant concession, as the workforce is largely made up of part-timers.

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In its financial update Tuesday, Ahold Delhaize said it expected the hit from the strike will be big enough to reduce its operating margin “slightly” from the 4.1 percent recorded in 2018. It will trim percentage growth in per-share operating profit from the high single digits to low single digits. The company had $2.9 billion in operating income in 2018. Its US shares remain depressed, down about 10 percent since the day before the strike.


You can reach me at larry.edelman@globe.com and follow me on Twitter @GlobeNewsEd. Sign up for my Talking Points AM newsletter here.