Safeway (SWY) Q2 2010 Earnings Call July 22, 2010 11:00 am ET Executives Melissa Plaisance - Senior Vice President of Finance & Investor Relations Robert Edwards - Chief Financial Officer and Executive Vice President Steven Burd - Executive Chairman, Chief Executive Officer, President and Chairman of Executive Committee Analysts Alex Bisson - Northcoast Research Edward Kelly - Crédit Suisse AG Meredith Adler - Barclays Capital Scott Mushkin - Jefferies & Company, Inc. Mark Wiltamuth - Morgan Stanley Karen Short - BMO Capital Markets U.S. Todd Duvick - Bank of America Corporation Deborah Weinswig - Citigroup Inc Robert Ohmes - BofA Merrill Lynch Damian Witkowski - Gabelli & Company, Inc. Andrew Wolf - BB&T Capital Markets Neil Currie - UBS Investment Bank PresentationQuestion-and-Answer SessionSteven Burd
Well, keep in mind that we're not going to do anything to harm our competitive price position. And I think that what we're seeing with us an extra price reduction that took place because of parity in the third and fourth quarter. So I think that these things just happened, they happened kind of naturally. I mean when beef costs went up, people didn't hesitate to reflect those at retail. Now that does create a little bit of a shift with consumers and what they choose to buy, and that's how consumers typically adapt to this. But the consumers have had a very good two years in the retail food world, and this is a thin-margin business. So I think, frankly, one of the first sectors to reflect the kind of cost inflation that's been occurring but not reflected at retail will in fact be this sector, and it's a sector that people have to buy in every week. And it may create in the near-term an acceleration in private label, but I think you will see a return to normal. You may not see full normalcy until late in 2011. I'm not going to try to predict that now. But I think you can only go so long and you're going to see a lot of retail -- you can see it in stores when you go out, but you will see, I think, liquidations and bankruptcies, and deteriorating store conditions in some of the smaller regional players. Think about our volume as building against all competitors in a down economy, so we're taking that from people that don't have our cost-reduction capability. So we're starting to build market share. Neil Currie - UBS Investment Bank In terms of that volume increase that you're seeing, are you seeing it build on a two-year basis? Is this just a reflection of negative volumes you're seeing or are you generally saying two-year basis?