Would a Tops Friendly Market at East Hill Plaza pose an anti-competitive threat to Wegmans?

May 28, 2011 by Mark H. Anbinder

After last year's acquisition of the P&C Foods supermarket chain by Tops Friendly Markets, the Federal Trade Commission is forcing Tops to divest itself of several stores in areas where the additional stores could give Tops an unfair advantage. We say it's ridiculous to consider the acquisition of the former P&C Store at East Hill Plaza in the Town of Ithaca, now operated by Tops, as anti-competitive.

Tops is operating the P&C Foods at East Hill Plaza, but hasn't been able to rebrand it.Tops is operating the P&C Foods at East Hill Plaza, but hasn't been able to rebrand it.While Tops does have two Tops-branded supermarkets in the area, they are in the City of Ithaca and Village of Lansing. The East Hill Plaza store is the only supermarket serving a large residential area southeast of Cornell University, including the Collegetown, Belle Sherman, Forest Home, Eastern Heights, and Ellis Hollow neighborhoods. 

Meanwhile, even if it appears that the Tops stores face competition only from a single Wegmans supermarket, there are several unrelated stores that, in reality, provide competition. GreenStar Cooperative Markets operates a large natural-foods grocery store in a former west-end grocery store building, and a smaller grocery store downtown. Aldi Foods has a discount food store near Franklin Plaza and the Ithaca Farmers Market.

Wal-Mart now offers lots of grocery features. Byrne Dairy, Shortstop Deli, Jason's Convenience, and others have convenience stores with considerable grocery inventory including fresh food. Area drug stores and gas stations also operate convenience stores. There's plenty of competition for Tops, and we don't believe Wegmans or any of the other aforementioned stores have anything to worry about.

The former northside P&C may become a community-run co-op.The former northside P&C may become a community-run co-op.The chain has already closed the former P&C Foods location on Hancock Street, the only P&C location that had been within the City of Ithaca. Northside community members hope to open a new cooperative store in the building, but have faced delays. The third P&C store in the area, at the Cayuga Mall in the Village of Lansing, remains open, but as it's directly across Triphammer Road from another Tops location, we don't expect it to remain open long-term. (Tops could sell it to another competitor who doesn't mind being across the street from a bigger, newer supermarket.)

Worst of all, the FTC appears to be considering forcing Tops to sell the East Hill store, which as we said is in an otherwise-underserved part of Tompkins County, to three of the people who ran the Penn Traffic chain into the ground in the first place.

We hope the FTC will reconsider and allow Tops to finish taking over the East Hill Plaza store, which has operated in limbo since they purchased the chain from the collapsing Penn Traffic. We hope they will not force Tops to sell this store. And, above all else, we hope they will not allow it to be operated by the people who couldn't keep their supermarket business afloat last time around.

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