Weis Markets will buy five Mars Super Markets stores


Towson, MD — The Weis Market in Towson Marketplace Shopping Center. (Jen Rynda / Patuxent Publishing)

June 24, 2016

Wes Markets plans to buy five Mars Super Markets grocery stores, more than doubling Weis' footprint in Baltimore County as the Pennsylvania food retailer continues pushing into the region.

Rosedale-based Mars, a family-owned independent grocer founded in 1943, currently runs 13 stores in the area but did not announce plans for the eight stores not included in the sale.

Weis said it agreed to buy two Mars stores in Dundalk and locations in Arbutus, Carney and Essex. The sale, for an undisclosed amount of money, is expected to close in late July, and the properties will convert to Weis stores in August.

Weis currently operates 25 stores in Maryland and, with the addition of the Mars stores, will have nine in Baltimore County.

The five locations are well-run and successful and made sense for Weis, also a family-owned independent chain, said Kurt Schertle, Weis' chief operating officer.

Weis, which first entered Maryland with a Hagerstown store in 1967, has expanded methodically through acquisitions as other grocers shed stores or shut down altogether. It took over a former Superfresh store in Towson in 2013, for example.

"We've been working on growing our footprint in Maryland, and specifically the Baltimore region, for years now, and we've always been an admirer of Mars," Schertle said. "They run a nice, local business. We thought for a while it would be a good opportunity. It turned out this happened to be the right time."

Chris D'Anna, Mars chairman and CEO, could not be reached for comment about the future of the remaining stores.

"As a family-owned business, we recognize Weis Markets as a company with a similar commitment to its communities, customers and associates," D'Anna said in the announcement. "This was an extremely important consideration in our decision."

Mars employs about 400 full-time and part-time workers at the stores to be sold. Weis officials visited the Mars stores Tuesday to schedule interviews with those workers in hopes of hiring most of them, Schertle said.

What happens to the rest of the Mars stores is less certain. Analysts said the D'Anna family has been trying to sell the chain and cutting costs to keep the stores going.

"Competition is still beating them up," said Jeremy Diamond, director of food brokerage company The Diamond Marketing Group. "They still don't have a niche."

Mars began expanding in the early 1980s, taking over closed Pantry Pride and Food Fair stores and a distribution center, and at one point had 17 stores. But the chain has suffered as mass discounters, drugstores and online sellers expanded their food and grocery offerings.

In 2014, the grocer closed its Edison Highway distribution center and laid off 78 workers. Last year, it closed stores in Aberdeen, Bel Air, Windsor Mill and Anne Arundel County's Riviera Beach.

Weis likely chose to buy the chain's best performing stores, said Jeff Metzger, publisher of Columbia-based Food World

Both Diamond and Metzger questioned Mars' future if it doesn't find a buyer soon for the remaining stores.

"I don't see Mars operating eight stores and it being worthwhile," Diamond said.

Meanwhile, Weis, with available cash and little debt, can quickly revitalize the stores it's buying, Diamond said.

Founded in 1912, Weis runs 162 stores in Maryland, Pennsylvania, New Jersey, New York and West Virginia. Two of its Baltimore County stores are in Perry Hall, with one each in Towson and Woodlawn. It reported nearly $2.9 billion in sales in its 2015 fiscal year.

Schertle said Weis plans to continue Mars' strategy of emphasizing local brands familiar to Baltimore shoppers, while adding more selection in gluten-free, organic and Weis private label products as well as trendier items such as sushi.

"We think we can learn a lot from the Mars stores [about] local merchandising," Schertle said. "Those five stores in Baltimore County can help us get better with local items. We want to add to their offerings while keeping local flair and local flavor that they have."

Weis also will be able to leverage its scale to improve operations at the Mars stores, he said.

Asked about growing consolidation and competition in food retailing from players such as Amazon and Wal-Mart, Schertle said he believed local "brick and mortar" supermarkets will always have a place.

"We think we need to be nimble and offer a good in-store experience," he said.

lorraine.mirabella@baltsun.com

About Weis Markets

Headquarters: Sunbury, Pa.

Stores: 162 in Maryland, Pennsylvania, New Jersey, New York and West Virginia

Baltimore-area stores: 16 in the counties around Baltimore

Sales: $2.88 billion in year ended Dec. 26, 2015

Founded: 1912