Kroger, the largest supermarket chain in the U.S., says it plans to close around 60 stores across the country over the next 18 months in a bid to improve profitability and streamline operations.

The announcement came during the company’s earnings call last Friday. While Kroger has yet to release a list of which locations will close, company leadership emphasized that the closures will be spread nationwide and that impacted employees will be offered positions at nearby stores.

“We see this as an opportunity to move sales from underperforming locations to more successful ones,” said interim Chairman and CEO Ronald Sargent. “We believe this will help improve overall profitability.”

Store Closures Come Amid Shifting Strategy

The planned closures mark a shift for Kroger, which had held off on shuttering any stores during its now-defunct merger attempt with rival grocer Albertsons. That $24.6 billion deal, announced in 2022, collapsed late last year after being blocked in court over antitrust concerns.

Sargent noted that Kroger typically evaluates store performance annually, but store closures were paused during the merger process. With that effort now behind them, the company is once again turning its focus to optimizing its footprint.

Expansion Still on the Horizon

Despite the closures, Kroger isn’t slowing down entirely. The company plans to open at least 30 new stores this year and says it will accelerate store openings in “high-growth geographies” starting next year.

The Cincinnati-based chain currently operates 2,731 stores across 35 states and Washington, D.C., under a variety of brand names including Ralphs, Fred Meyer, Smith’s, and King Soopers.

Labor Tensions Simmer

Kroger’s announcement comes at a tense moment for the company, which is facing ongoing labor unrest. Workers represented by the United Food and Commercial Workers union have raised concerns about chronic understaffing and difficult working conditions.

Union members in Southern California began picketing outside a Los Angeles Ralphs last week. Earlier this year, employees at King Soopers stores in Colorado also went on strike over similar issues.

As the company navigates a changing retail landscape and increasing pressure from labor groups, it remains to be seen how these strategic shifts will play out for both shoppers and employees.

Source: AP News – Kroger plans to close 60 US stores in 18 months to improve profits

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