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R. Randall Onstead, who took over as president of Safeway’s embattled Dominick’s division in Chicago just nine months ago, resigned from the post last Friday.

Onstead said he was quitting because, after the recent death of his father – Robert Onstead, the founder of Randall’s Food Markets in Texas – he needed to administer the family’s portfolio of investments.

Onstead will be replaced by Bruce Everette, executive vice president of Safeway, who will add leadership of the Chicago division to his responsibilities.

Safeway had tried to sell Dominick’s after several years of declining sales and a history of fractured labor relations. However, when it couldn’t get what was considered an appropriate deal, it recommitted to the chain and named Onstead to the president’s job. Onstead had promised to improve the company’s relationship with employees and expand and improve the division in a way that made sense for local consumers.
KC's View:
While Onstead hadn’t made everyone a believer in his ability to turn the division around, at some level we suspect he may have had a fighting chance because he wasn’t a longtime Safeway insider. Everette, we suspect, will have a tougher job convincing employees of his good intentions, if for no other reason than he is keeping his Safeway corporate job.

This doesn’t sound like a positive scenario for Dominick’s employees, and nor for the chain’s long-term prospects.