Always Changing for the Better

Safeway, the Start-Up
In 1915, M.B. Skaggs, an ambitious young man in the small Idaho town of American Falls, purchased a tiny grocery store from his father. M.B.'s business strategy, to give his customers value and to expand by keeping a narrow profit margin, proved spectacularly successful. By 1926 he was operating 428 Skaggs stores in 10 states. M.B. almost doubled the size of his business that year when he merged his company with 322 Safeway (formerly Selig) stores. Two years later M.B. listed Safeway on the New York Stock Exchange. M.B. did not let the difficulties of the Great Depression dilute his pioneering focus on value for customers. In the 1930's Safeway introduced produce pricing by the pound, open dating on perishables to assure freshness, nutritional labeling, even some of the first parking lots.

Safeway Expands
Today M.B. Skagg's value vision still drives Safeway, though on a dramatically larger scale. There are 1,775 Safeway stores across the US and Canada. These include 312 Vons stores in Southern California and Nevada, 112 Randalls and Tom Thumb stores in Texas, 37 Genuardi's store in the Philadelphia area, as well as 17 Carrs stores in Alaska.

Not Just a Store, a Brand
A key ingredient in Safeway's success has been the introduction of one of the most extensive private labels programs in North America. Our customers can choose from some 3,000 products including Safeway, Lucerne and Mrs. Wright's. An additional 1,250 premium products are marketed under the award-winning Safeway SELECT label.

Community Partnerships
Our customers are also our neighbors. Safeway has always made giving back to the community a priority. In 2005 we donated millions of pounds of merchandise to America's Second Harvest food banks and other hunger-relief organizations. We also contributed more than $25 million to schools through eScrip and other educational programs. In addition, we donated a combined $15 million through major fundraising campaigns to support breast and prostate cancer research, treatment and education and to further the fine workof the Muscular Dystrophy Association and Easter Seals. We also raised more than $3.6 million to assist victims of the devastating tsunami in South Asia and Eastern Africa, and $3.7 million for Hurricane Katrina victims in the Gulf Coast region. In addition, our employee efforts to help the disabled have raised more than $75 million for Easter Seals since 1985.

Environmental Leadership
Safeway has a continuing history of environmental responsibility, starting with cardboard recycling in 1960. Today we typically recycle over 450,000 tons of material per year. In addition, through a partnership with the Environmental Protection Agency, we have become one of the nation's largest commercial buyers of renewable energy. Our environmental policy has also included replacing ozone-depleting CFC's in our store refrigeration systems. Safeway's emergence as one of the largest food and drug retailers in North America is that it has not come at the expense of M.B. Scagg's vision. His strong sense of customer value that proved so innovative in American Falls in 1915, continues to work successfully in a new century.