Retailers across the globe are facing massive declines in sales due to the 2020 economic
downturn. Many grocers, on the other hand, have thrived in the stay-at-home pandemic
while others are facing closures to balance out the books. Still,
some grocery stores may not survive the next year.
Whole Foods, the grocery store formerly known as the luxury grocery shopping spot with the upbeat,
hip staff, is now a shell of its former self. Parent company Amazon is known for its
race-to-the-bottom prices and data-driven business decisions, and now, Whole Foods CEO John Mackey
told The Wall Street Journal that he also predicts the demise of the grocery store as we know it.
The pandemic accelerated the online grocery shopping trend,
a move the brand has wholeheartedly embraced thanks to its parent company.
Mackey has also pointed to the pandemic being one of the main reasons for traditional stores
seeing an added drain: added costs for store owners include providing masks,
temperature checks, and disinfecting to keep both employees and customers safe.
NBC 5 Chicago reported that Whole Foods closed one of its Chicago locations in Lincoln Park
with the directive to continue online food sales instead. The local news outlet found one
spokesperson who said that as the grocery store faced the challenges associated with COVID-19,
the retailer will be looking for new ways to meet demands for online grocery shopping to reach more
customers. Shoppers will need to stay tuned to see what 2021 brings for the beloved grocer.
"Is the salmon wild-caught?"
"She only eats wild-caught."
Family Dollar is a discount grocery and dollar store found all over North America.
At least, it used to be. In 2019, CNBC reported on the closure of 390 Family Dollar locations.
As part of the massive transition, the company moved to open, close,
and relocate hundreds of its stores in order to stay afloat. In just one quarter, the company
lost $2.31 billion compared to a profit of about half that amount the year previous.
Essentially, the grocer took a huge turn for the worse.
The brand also planned to renovate another 1,000 locations after its losses.
Upgrades included around 400 stores receiving larger freezer and cooler sections,
as well as certain stores selling alcohol. The parent company also
rebranded another 200 stores from the Family Dollar name to Dollar Tree.
But there's a bit of good news: discount stores continue to be popular, especially
during economic downturns when people are low on cash or facing unemployment.
You might not be familiar with Lucky's Market unless you live in Florida or Colorado.
The popular store started in Boulder, Colorado, as a mid-priced boutique grocer,
and according to the South Florida Sun Sentinel,
the chain grocery store shuttered 20 out of 21 stores across the Sunshine State in 2020.
Supermarket giant Kroger also decided to pull out as an investor, adding uncertainty for
Lucky's expansion into Florida. Kroger doesn't have any locations in Florida,
they had originally seen the store known for its reusable bags, generous samples,
and "sip 'n stroll" policies as a way to break in.
Publix plans to buy five leases from the former Lucky's Market in Florida locations,
but at the same time, the specialty grocer also filed for Chapter 11 bankruptcy protection in
Delaware. An additional six stores could be sold to another popular discount grocer,
Aldi, making sure communities aren't at a complete loss.
Social media devotees left comments lamenting the loss of Lucky's Market
and the best bacon in town. The sale resulted in going-out-of-business liquidation sales,
and speculation is still rampant over what will replace the specialty grocery stores.
Shutdowns caused by COVID-19 outbreaks and fear of protests have become the norm in 2020.
Granted, grocery stores such as Sam's Club temporarily shutting its doors
is only a minor inconvenience in these cases. The Walmart-owned membership warehouse, however,
needs to be even more strategic due to its spotty history.
In 2018, Sam's Club closed 63 of its stores without warning,
which was especially tragic for its employees who were suddenly out of a job. Media outlets
found out about the closures from employees who were left out on the street. Even worse,
corporate spokespersons stayed quiet about the whole process. And we thought 2020 was rocky.
"Two days ago, I just got my -- I just renewed my membership. I paid 45 dollars. So I was like, aw."
Sam's Club has experienced turbulence well before the abrupt closures.
The membership retailer started having trouble back in 2015 when revenue fell flat. Ironically,
the megastore known for using loss leaders built its business model to appeal to small
business owners, assuming they would shop at the warehouse to stock their stores.
Instead, most entrepreneurs paid for memberships to shop for bargains only for personal use. In
an attempt to save its remaining stores, Sam's Club has made major overhauls to its business
model in the following years. Yahoo Finance reports curbside pick-up for all members,
instead of only premium cardholders, is one move to stay relevant in the wake of the pandemic.
BI-LO used to be a mainstay grocer for South Carolina shoppers. Founded in Greenville,
Coupons in the News says that the privately owned company just hasn't
had the scale and popularity of the Southern mainstay Winn-Dixie
or the targeted appeal of Southeastern Grocer's newest brand Fresco y Más.
In the summer of 2020, the company sold almost half of the 100-store chain.
Greenville Business Review announced that the chain would sell 62 stores by handing over 46
BI-LO and 16 of its sister stores, Harveys Supermarkets, to its competitor Food Lion.
Then, on September 1, 2020, Southeastern Grocers announced it would let go of another
23 grocery stores. Food Lion even acquired the BI-LO distribution center in South Carolina.
BI-LO looks to finally meet its end after surviving two bankruptcies and six decades.
As of the announcement in 2020, the umbrella company of SEG
still operates 550 grocery stores under the Winn-Dixie, Harveys, and Fresco y Más banners.
Grocery store conglomerate Southeastern Grocers started unloading multiple brands
as 2020 began wrapping up. Supermarket News found SEG operates 550 grocery
stores across the southern United States, and as far as what's going?
Harvey's Supermarket is on the chopping block with SEG unloading 30 stores in Florida, Georgia,
and the Carolinas. Food Lion said a store banner conversion is slated to be made over
a staggered period, and with the transfer, the Food Lion parent company will have nearly 700
stores in the Carolinas and Georgia. Food Lion brands can also be found in the Mid-Atlantic,
Northeast, and New England regions with more than 77,000 employees.
Local station Fox 31 News reported at least 16 of the Harvey's stores will be rebranded in Southwest
Georgia. On a positive note, Food Lion plans to hire around 4,650 associates to serve customers
at its 62 new stores, while Georgia shoppers will be left with 28 Harvey's locations in the
state. Food Lion representatives also encouraged the laid-off employees to reapply to any of the
Food Lion locations. A "gee thanks" might be in order while adding to the retail carnage of 2020.
Southeastern Grocers is once again reducing its footprint, closing multiple grocery stores and
laying off employees. The company started in 1961 as BI-LO — the now defunct grocery
store brand — in Greenville, South Carolina. Last year, it was announced that SEG went
through a prepackaged Chapter 11 bankruptcy, resulting in a reorganization of its multiple
brands that reduced its debt by half. Seven Winn-Dixie stores planned to close as a result.
Winn-Dixie is one of the popular brands that's seen turbulent times.
Before being acquired by Southeastern Grocers, the grocery store synonymous with the Southeast
also went through two bankruptcy reorganizations to save the brand.
The Tampa Bay Times reported the SEG umbrella still faced the pandemic half-way through
its five-year restructuring plan. Shoppers may see more changes as a result since the company
has shredded unprofitable locations, bought stores, and expanded its digital footprint.
"Our website makes substitutions a snap. You asked for pasta sauce. Do you want salsa?
You asked for toilet paper. Do you want a DVD of VanHelsing?"
Kroger is the nation's largest grocery store chain, but it's also facing some
stiff competition. The Indy Star found the 66-year-old store in Broad Ripple, Indianapolis,
faced competition from an upscale market, seasonal farmer's market,
and a health food store. The mega brand ultimately decided to close the strained
store in the Broad Ripple neighborhood, which means fewer options for community shoppers.
Kroger is also closing another store in Springfield, Ohio. The Cincinnati
Business Courier reported one Greater Cincinnati Kroger store will close,
as will another Kroger store near Dayton. The partner station in Dayton found that
this is the third location in the Springfield area to close in recent years. Springfield's
mayor issued a statement speaking out against the closure instead of choosing to improve the store,
but closures and layoffs aren't unusual for the widespread grocer. In 2019,
the Knox News found Kroger cut hundreds of local management jobs nationwide.
Like many retailers adapting to a new economy,
the brand plans to focus more on technology and infrastructure in its existing stores.
Shoppers Grocers is a Providence, Rhode Island-based grocery chain that has closed
many of its doors in recent years. Washington Business Journal found devotees of the grocery
brand might have a year to 18 months before the merger and sale of 24 remaining properties.
Shoppers' parent company, United Natural Foods, started to sell or close most of its stores in an
effort to get out of the retail business for good. Popular German discount grocer Lidl purchased many
of the Shoppers' locations that were available via the liquidation sale. Only 14 Shoppers stores
remain in Washington and the Baltimore region. Additional Shoppers stores operate in Virginia.
Grocery Dive reported the CEO announced a halt on additional sales of the locations
due to stay-at-home orders and a spike in grocery sales for frugal shoppers.
So, what does that mean? The limited stores could stay open through 2021 if
the pandemic trends stick around and continues to boost sales.
Retailers across the country are taking a bit hit during the economic downturn.
Shops are shutting their doors, and layoffs are becoming commonplace.
Although sales for many grocers are looking up due to restaurants closing and forcing
more people to cook at home, Forbes reported that Albertsons is the only grocery store
that gets a very high risk of default by RapidRatings's financial health ratings.
At the start of 2020, the New York Post reported that the widespread supermarket
hit a few bumps when it announced it wouldn't be able to cover pension plans as soon as 2021.
This announcement — and potential legal action if it doesn't meet its financial commitments — came
right as the grocer wanted to go public. As a parent company to Safeway, Shaw's,
and Acme chains, Albertsons wouldn't be able to meet around $565 million in group pension plans,
covering around 50,000 supermarket workers in the Washington, D.C., area.
Grocery stores are certainly making lemonade out of the lemons of the pandemic.
Business is booming — for now. Like many grocers,
Supermarket News found Albertsons is being forced to cater to an online audience and
innovate with curbside offerings. Buy-online, pickup-in-store, and curbside pickup are also
services retailers in all industries will need to offer in order to prosper in the new normal.
Safeway is a major U.S. grocer with 897 locations nationwide. The first Safeway store opened in 1915
in a small Idaho town as a family-run business. Now Albertsons operates Safeway and other brands
as part of one of the largest food and drug retailers in the country. Despite its massive
size, they've had some massive problems. Inner turmoil, such as not being able to pay retirement
accounts for its employees, might come as a bit of a shock for such name-brand operation.
In cities across the country, locals have also responded in shock to the news that
their city's Safeway stores will be shutting their doors. The Tacoma Daily Index reported
two stores out of the nine locations in Tacoma are closing soon. The Safeways are situated not very
far from one another. Locals are already speculating what will take their places.
The state of Washington is home to 18 Safeway stores in Seattle and another eight in Spokane.
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