Kroger, the second largest grocery store chain and the largest employer in Ohio, announced their plans to close 60 stores across the country. That decision will play out over the next year and a half. This decision is the next move in the company’s ongoing effort to reduce complexity and improve its customer experience. Today, Kroger has more than 2,700 grocery stores in 35 states, under a variety of regional names. Besides its own Kroger brand, it operates 19 other regional brands, including the household names of Food 4 Less, Fred Meyer, and King Soopers.
The closures will impact a small fraction of Kroger’s billions of annual customer transactions through their vaunted store network – which serves nearly ten million customers weekly. Furthermore, their company’s footprint is changing. It wants to try to make its last stores better and funnel more money into providing better service on the few that remain.
Kroger’s management has claimed that these closures are projected to produce a “modest financial benefit” to the organization. The company says it will reinvest any savings produced through these closures back into enriching customer experiences throughout the business.
“As a result of these store closures, Kroger expects a modest financial benefit,” – Kroger
Beyond the money, Kroger made a public relations play with the merger, touting its employee commitment. The company announced that it would offer roles in other stores to all associates currently working at the affected locations. This last decision is expressly intended to reduce harm to workers in this transition period.
“Kroger is committed to reinvesting these savings back into the customer experience, and as a result, this will not impact full-year guidance,” – Kroger
As companies across the retail sector continue to close stores in a broader trend, they’re streamlining operations to bring them in line with shifting consumer patterns and a fast-evolving marketplace. Grocery shopping experience is shifting quickly. In turn, Kroger is proactively shifting gears to better compete in the fast-paced world of retail and fulfill savvier consumers’ changing needs.
