Kroger plans to close 60 US stores in 18 months to improve profits

Key Points

• Kroger plans to close around 60 U.S. grocery stores over the next 18 months to improve efficiency by shifting sales to other locations.
• Employees at impacted stores will be offered jobs at other Kroger locations.
• At the same time, Kroger will open at least 30 new stores this year and accelerate expansion in “high-growth geographies” next year.
• These closures follow a pause during its failed $24.6 billion Albertsons merger and come amid labor unrest over chronic understaffing, including recent pickets and strikes.

Kroger plans to close around 60 U.S. grocery stores over the next 18 months to improve efficiency.

The Cincinnati, Ohio-based company announced the plan during a corporate earnings call last Friday. The company hasn’t said which stores it plans to shutter, but said the closures will happen around the country. It also said employees at impacted stores will be offered jobs at other locations.

“We see this as an opportunity to move these closed store sales to other stores, and we think that should improve profitability,” Kroger’s interim Chairman and CEO Ronald Sargent said during the call.

Sargent also said Kroger plans to open at least 30 stores this year and will accelerate its store openings in “high-growth geographies” next year.

A message seeking details of the company's plans was left Wednesday with Kroger.

Kroger is the nation’s largest supermarket chain, with 2,731 stores in 35 states and the District of Columbia. It operates stores under multiple brand names, including Smith’s, Ralphs, King Soopers and Fred Meyer.

Sargent said Kroger usually evaluates the performance of individual stores on an annual basis but it deferred any store closings during its two-year effort to merge with rival Albertsons. The two companies announced the $24.6 billion merger plan in 2022 but the deal fell apart late last year after two judges blocked it due to concerns about competition.

Kroger's plan to close stores comes as the company is facing labor unrest over issues including chronic understaffing at stores, according to the United Food and Commercial Workers union. Union members in Southern California began picketing at a Los Angeles Ralphs last week. Workers at King Soopers stores in Colorado also went on strike earlier this year.