Safeway 1998 Annual Report Download - page 12

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Operating and administrative expense as a percentage
of sales declined for the sixth consecutive year in 1998.
This trend reflects ongoing efforts throughout the
company to streamline support functions, simplify
work practices and maintain labor cost parity. These
e ff o r ts are focused on areas invisible to our cus-
tomers – procurement, distribution, manufacturing
and administration. We continuously seek ways to
operate our business at lower cost.
Controlling Expenses
We began consoli-
dating corporate
administrative functions
at Dominick’s into
Safeway’s operations.
We negotiated
competitive labor
agreements in several
key markets.
We continued to
control the frequency
and cost of workers’
compensation
claims in 1998.
Ongoing improvements
in procurement and
category management
have reduced our
cost of goods sold as
a percentage of sales.