Sprouts plans 13 more stores for the second half of the year

Sprouts Farmers Markets announced that it plans to open 13 stores in six states during the second half of 2019. Openings are slated for Virginia, Florida, California, Maryland, North Carolina and Arizona.

The company recently opened it's first Pennsylvania store in Philadelphia, and a store is scheduled to open on June 5 in Marlton, which will be Sprouts' first location in New Jersey.

Sprouts said it expects to have 340 stores in 22 states by the end of the year.

Lidl to open first store in PA

Lidl announced that its first Pennsylvania store will open next week in Folsom. The company, which operates about 10,000 stores in 29 countries, has 59 operating U.S. stores throughout New Jersey, Delaware, Maryland, Virginia, North Carolina, South Carolina and Georgia.

Lidl announced earlier this month that it plans to purchase 27 Best Supermarkets, mostly in New York.

In Pennsylvania, Lidl also has plans for stores in Philadelphia and Montgomery County.

Lidl to acquire 27 Best Market stores in New York and New Jersey

Lidl announced today that it plans to purchase 27 Best Market supermarkets in New York and New Jersey for an undisclosed amount. Twenty four of the Best Market stores are located in Long Island. The deal is expected to close early next year, and all of the acquired stores will be converted to the Lidl banner.

Lidl currently operates 59 stores in Virginia, North Carolina, South Carolina, Georgia, Maryland, Delaware and New Jersey. In addition, stores are under construction in Pennsylvania and are expected to open in 2019.

Both companies said that all Best Market employees in New Jersey and New York will have guaranteed employment opportunities with Lidl, and will be offered positions with wages and benefits equal or better than what they currently have.

Best Market opened its first store in 1994 and has grown relatively quickly. The company has opened or acquired 11 stores since 2015.

Giant opens new, improved store in Feasterville

Earlier this month Giant Food opened its new Feasterville, PA location. The new store is 66,000 square feet, approximately 25 percent larger than the store down the street that closed a day before the new Giant opened.

The new location includes an expanded fresh produce department with more organic selections, fresh-squeezed juices, in-store cut fruit, and a full salad bar. It also features a Beer & Wine Eatery with over 400 types of beer available. According to a news release, Giant is partnering with 13 local breweries from Pennsylvania and New Jersey, all of which are featured in the store.

In addition, the new Giant includes a full-service pharmacy with pharmacists available seven days a week, and a Starbucks-on-the-Go kiosk.

Giant currently has 171 stores in four states.

The Fresh Market to close 15 stores

The Fresh Market announced yesterday that it plans to close 15 stores in nine states. None of the closings are in Pennsylvania, New Jersey or Delaware.

The closings are expected to take place in the next two to four weeks. Four of the stores are in Illinois, two in Georgia, two in Virginia, and one each in Indiana, Kentucky, North Carolina, New Hampshire and Tennessee.

There are currently five Fresh Market stores in Pennsylvania, two in New Jersey and one in Delaware.

"Over the last eight months, our company has been executing a turnaround plan, and we've seen great progress," said CEO Larry Appel. "However, for a variety of reasons unique to each retail location, that progress is not evenly distributed and, as a result, we have decided to close these long-term under-performing stores."

The Fresh Market, which currently operates 176 stores in 24 states, has had several stores closings in recent years as competition - both online and brick-and-mortar - has adversely impacted sales.

Sprouts confirms South Philly store but isn't coming to South Jersey

Sprouts Farmers Market announced that its first Pennsylvania store, under construction in South Philadelphia, will open before the end of the year. The 32,000 square foot store will be part of Kimco Realty's Lincoln Square development that includes Target, PetSmart and approximately 350 apartments.

It had been reported since last spring that Sprouts was coming to South Philadelphia and the vacant Macy's space at the Moorestown Mall in New Jersey. However, a spokesperson for PREIT, the mall's owner, said the company is moving forward with another grocer for the site.

Sprouts operates 280 stores in 15 states.

Lidl shifting strategy, may consider leasing, smaller stores

Lidl announced earlier this month that it is changing its real estate strategy and may now consider leasing sites, and opening stores in the 10,000 to 21,000 square foot range. Up until now the company has said it would only purchase properties where it would construct 36,000 square foot stores.

William Harwood, Lidl's director of communications, said the change in strategy is an effort to "accelerate our site acquisition along the East Coast." Harwood also noted that Lidl is looking for opportunities in urban areas where larger sites are harder to find.

Harwood claimed that Lidl is "very pleased with how customers have taken to the 47 stores we have opened over the past six months."

However, industry analysts speculate that Lidl's shift in real estate strategy may be due to disappointing results.

A report released by inMarket showed that the first Lidl stores opened in June with a 2.6% share of customer visits in the markets in which it was operating. Its share slid to 2.3% in July and 1.7% in August before rebounding in September to 1.9%. inMarket's chief marketing officer said that he will have a better feeling for the discount grocer's future once holiday traffic is analyzed.

Lidl recently backed out of planned deals in New Jersey, Pennsylvania, Virginia and Ohio.

Amazon/Whole Foods working on new formats; AmazonFresh cuts service

Amazon revealed during its third quarter earnings conference call that it is working with Whole Foods executives on new grocery store formats.

"There will be a lot of work together between Prime Now, AmazonFresh, Whole Foods, Whole Foods products on the Amazon site, (and) Amazon Lockers at the Whole Foods stores," according to Amazon CFO Brian Olsavon.

Olsavon also said the company plans to open more Whole Foods stores.

Meanwhile, Whole Foods said last week that it will add in-store pop-up shops in select stores that feature technology products from Amazon. The stores will also provide information about Amazon's Prime membership and Prime Video offerings.

AmazonFresh

Amazon announced earlier this month that it would discontinue its AmazonFresh grocery delivery service to select zip codes around the country. Customers in several states, including New York, Pennsylvania, New Jersey and Delaware, have reported receiving notices that the service would soon end.

According to a Planet Retail RNG analyst, Amazon's Prime Now service, which provides grocery delivery in under two hours, appears to be more successful than AmazonFresh, which has been economically challenging to operate.

"There is some internal rationalization happening for Amazon in grocery as it integrates the Whole Foods stores into its business," said the analyst. "While Instacart does have almost three-and-a-half years remaining on an agreement with Whole Foods to be its exclusive perishables delivery provider, I think Amazon long term will take this over, delivering groceries from Whole Foods stores using its own Prime Now program."

"Amazon's move today away from the AmazonFresh program is a clear second step in integrating Whole Foods, with many more moves to come," said Spencer Millerberg, CEO of One Click Retail. "AmazonFresh on its own has not gained sufficient momentum in 10 years since it launched, while Whole Foods items on Amazon have been growing around 8% per week since launch."

Analysts agree that Amazon will likely expand its e-commerce efforts in areas where Whole Foods operates in order to leverage the retailer's brick-and-mortar presence.

Lidl opening first NJ store next week

Lidl's first New Jersey store is slated to open in Vineland next Thursday, November 16. The German retailer has stores in 28 countries, and currently has 41 stores in five U.S. states.

Several stores are slated for Pennsylvania, but none are expected to open this year.

Mixed reviews for Lidl so far

A recent story on fooddive.com reported that shoppers are giving Lidl's new U.S. stores mixed reviews. The German grocer currently has 41 stores open in five states, with plans to establish at least 100 stores from New Jersey to Georgia by next summer (although multiple sources have reported delays in store openings due to slow sales).

According to the story, shoppers have been impressed with Lidl's low prices, bakery section, organic fruit, fresh produce and wine selection. However, shoppers have complained about the merchandise mix, having to purchase shopping bags, the limited assortment of brands, inconsistent service, and items being out of stock.

ShopRite tops in New Jersey with 139 stores

A story on NJ.com last month listed the 10 biggest supermarket chains (by number of stores) in New Jersey. Here's the list.

ShopRite - 139 stores
Acme - 77
Stop & Shop - 61
Target - 44
Aldi - 42
Walmart - 29
BJ's Wholesale Club - 23
Kings Food Market - 23
Save-A-Lot - 22
Key Food - 22

Stores in New Jersey with fewer locations include Whole Foods, Trader Joe's, Wegmans, Weis Markets, and soon... Lidl.

Walmart reacting to Lidl with aggressive pricing

Reports state that Walmart is reacting "quickly and aggressively" to Lidl's entry into the U.S. market. According to its website, Lidl now has 21 stores open in three states - North Carolina, South Carolina and Virginia - with plans in the next year for as many as 100 more in states from New Jersey to Georgia.

Since its first U.S. stores opened in June, Lidl has been hailed as the low price leader along with rival Aldi. But according to Rupesh Parikh, an analyst at Oppenheimer & Co., "Walmart is being really aggressive in terms of watching what Lidl, and presumably Aldi, are doing, and you can tell they are in a fight and not willing to give up customers."

"We found Walmart prices on like-for-like items were very compettive with both Lidl and Aldi," Parikh said.

Parikh also reported that several other retailers in current Lidl markets were reacting with lower prices, including Food Lion, Family Dollar, Dollar General and Target. The most aggressive pricing by all the food retailers has been in the private label category, which Parikh believes could lead to higher margins on other products in order to keep overall profits from falling.

Lidl's next U.S. market is likely to be Texas, where the German company recently opened a number of offices.

First 20 Lidl stores coming this summer

Lidl revealed this morning that it plans to open 20 stores this summer, with the earliest openings coming in June. The company didn't specify which stores would open next month, but did release a list of the first 20. They are in North Carolina (9), Virginia (9) and South Carolina (2).

All 20 stores will be serviced from Lidl's new distribution centers in Virginia and North Carolina. A distribution center in Maryland is still under construction.

According to Lidl US CEO Brendan Proctor, an additional 80 stores in markets from New Jersey to Georgia will open by the summer of 2018.

"People want a good quality product, they want it at a good price and they don't want to spend all day in a store - they want to get back to living," Proctor said. "That's what our model is about. That's our strength."

When asked about some reported skepticism about Lidl's real estate choices, Proctor deflected the question and touted the company's ability to adapt and the quality of its offerings.

As for the store's product mix, Proctor said they will source about 85% of products from the U.S. EVP and Chief Commercial Officer Boudewijn Tiktak added that around 90% of the selection will be private brand.

All Lidl stores will have bakeries but no service deli or meat departments.

Albertsons in talks to acquire Sprouts

It was reported last week that Albertsons is considering a deal to acquire Sprouts Farmers Markets, and an industry source told me that he thought the likelihood of such a deal was 50-50.

Sprouts, based in Phoenix, is the largest farmers' market-style food retailer in the country. It operates more than 250 stores in 15 states, not including Pennsylvania, where a Philadelphia store is planned. There are no stores currently in New Jersey either, and it has been rumored that the company is looking for a site in South Jersey.

According to reports, Sprouts has plans to open 32 stores this year, following 36 new stores last year and 27 in 2015.

Jefferies Anlyst Chris Mandeville said last week that "the logic of a deal makes sense in our view," but added that it would be very expensive.

Albertsons, which is owned by Cerberus Capital, acquired Safeway and Supervalu in recent years. Reports said that the company was in talks to acquire Price Chopper late last year, but the deal never happened.

Lidl to begin opening stores this summer

Lidl announced last month that it would open the first 20 of its U.S. stores this summer rather than waiting for 2018. It had been previously thought that the company would open about 100 stores in the first quarter of next year.

Lidl has been aggressively purchasing property in Eastern states from New Jersey to Georgia, and it has been reported that they now have real estate representatives in Texas. The stores to open this summer are reportedly planned for Virginia, North Carolina and South Carolina.

Schwarz Group, one of Europe's largest retailers and the parent to Lidl, established its U.S. headquarters in Arlington, VA and is building distribution centers in Maryland, Virginia and North Carolina. Its strategy so far has been to purchase ground so that its 36,000 square foot stores will be in direct competition to traditional supermarkets as well as small-format and discount grocery retailers.

"We are thrilled to introduce residents across the East Coast to a unique shopping experience," said a company representative. "Grocery shopping involves too much compromise. Customers are being forced to choose between quality, price and convenience, and this is a compromise they shouldn't have to make. At Lidl, we are committed to delivering outstanding quality goods to our customers at market leading prices."

Asian grocer 99 Ranch opening stores in New Jersey

Asian supermarket 99 Ranch plans to open at least three stores in New Jersey this year, according to published reports. The first store, a 60,000 square foot former Pathmark, opened recently in Edison, NJ, about a mile from an H Mart, which is also an Asian grocery chain. 99 Ranch stores are also slated for Jersey City and Hackensack.

The chain is owned and operated by California-based Tawa Supermarket, Inc. and has 42 additional locations in its home state, Washington, Nevada and Texas.

99 Ranch focuses on products from China, but also includes a broad assortment of foods from other Asian countries including India and the Philippines.

Lidl secures sites in Cumberland County, NJ

The Philadelphia Business Journal reported yesterday that Lidl has secured three Cumberland County, NJ locations - Millville, Upper Deerfield and Vineland. It is presumed that the stores will open in 2018, when anywhere from 75 - 125 new Lidl stores are slated to open between New Jersey and Georgia.

The company, which plans to operate stores that are 36,000 square feet, intends to challenge Aldi and other grocery retailers in the United States. It is already Aldi's biggest rival in Europe. Lidl has reportedly secured stores all throughout the Greater Philadelphia region.

Weis to increase cap-ex to $140 million

Weis Markets announced last month that it plans to increase capital spending by 33% this year to a record $140 million. The funds will cover the cost of three new stores, 20 remodels and technology investments.

Last year's capital spending totaled $92 million and covered 14 remodels and five Gas N' Go centers.

Weis operates 162 stores in Pennsylvania, Maryland, New Jersey, New York and West Virginia.

Analyst says Aldi and Lidl to hurt small grocery operators

A Supermarket News story recently quoted an analyst who predicted that the "invasion" of Lidl into the U.S., combined with Aldi's rapid expansion, will prove to be problematic for smaller operators and those focused on lower-income shoppers. The analyst did not think the two European powerhouses would have as devastating an effect on top U.S. grocers.

However, based on where Lidl is buying property in the Greater Philadelphia region, it certainly appears they believe they will have a big effect on top grocers. From what I have seen, they are eager to open up stores adjacent to - or across the street from - market leaders Giant and ShopRite.

Although they are opening new stores all over the country, Aldi's recent growth has been mostly focused on California. Lidl is planning to open at least 75 stores from New Jersey to Georgia in early 2018.

Ahold to grow online sales by 80% in three years

Ahold (Giant, Stop & Shop, Peapod) CEO Dick Boer recently said he would like the company to grow online sales by nearly 80% over the next three years, from approximately $1.7 billion to about $3.1 billion. The company's online strategy would involve growing its market share, expanding its geographic reach and increasing the number of items sold.

To that effect, Peapod, Ahold's U.S. online grocery delivery service, opened a new distribution center in New Jersey, and plans to open a new warehouse in Indianapolis next year. Peapod sales this year are expected to total $590 million, which represents annual growth rates of 11% over the last five years.