Mexico’s Gigante supermarket chain has found it harder to expand in the
US than expected. The chain has three stores in the LA area, only half the originally
projected number. Most of the chain’s problems to date relate to labour disputes
and poor morale resulting from Gigante’s below-market wage scale. To date, management’s
call to do things "the Mexican way" has fallen on deaf ears in the Mexican-American
neighbourhoods where the stores are located.

Unused to coping with organised labour in the US, Gigante’s management made
the mistake of punishing union sympathisers by giving them reduced work schedules.
About a year ago, the United Food and Commercial Workers responded by
organising protests. These ate into employee morale and tarnished the chain’s
image in the working class neighbourhoods it serves.

Gigante’s roughly 300 US employees are not unionised, but the UFCW wants to
change that. If the union wins out and wages take a leap, Gigante will find
it harder to undercut the prices of its competitors. Up to now, lower prices
have been the chain’s main appeal.

By Steve Lewis, correspondent

How well do you really know your competitors?

Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.

Company Profile – free sample

Thank you!

Your download email will arrive shortly

Not ready to buy yet? Download a free sample

We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form

By GlobalData