5 Grocery Retailers That Cater to Customers with Different Business Models

Despite some supermarkets being national and well known—Whole Foods, Kroger and Costco, for example, many that are regional dominate their different parts of the country with different strategies, from bulk shopping and low prices to fresh produce. As food inflation has slowed, Placer.ai looked at five regional chains that have experienced consistent growth in the first half of 2023 and are expected to continue their strong performance into the second half and beyond. Others may learn from what’s encouraging these chains’ healthy foot traffic and loyalty.

Stater Bros. Market, based in Southern California’s San Bernardino, opened as far back as the Great Depression but has managed to expand to more than 170 locations in its state. Known for its family-friendly shopping experience with relatively small stores near distribution centers, that has helped its products remain local and fresh. Monthly visits grew this year versus last year despite several stores closing. And the year-over-year visits also increased; for example, visits per venue rose 4.9% in June, 7.7% in July and 6.6% in August in 2023 versus 2022. The conclusion is that the chain has been able to keep its loyal visitor base and detour those who visited shuttered stores to other Stater Bros. markets.

Smart & Final is another California-based chain located in Commerce, Calif., and one of the oldest warehouse grocery chains in the country. It says on its website that it has grown through mergers and acquisitions, with the oldest of the combined companies, Hellman-Haas Grocery, founded in 1871 in Los Angeles. It was one of the first to offer cash and carry or the option for customers to take home their groceries after shopping rather than have to wait for the grocery to deliver them to their door. It has also been committed to more innovation and improvements, the report said. For example, shoppers can take advantage of its warehouse-style shopping options without a membership cards at its Extra! Stores. The chain outperforms the California grocery category and wider national sector on a YoY monthly visit basis as its shoppers prioritize doing so in bulk to save where possible. 

WinCo Foods. once labeled “Walmart’s Worst Enemy,” is a Boise, Idaho-based chain that’s other discount oriented by mixing bulk shopping and low prices. It’s also a certified employee-owned company that started in 1967 and now has more than 130 locations, according to its website. It’s moved far beyond its Idaho base to Washington, Nevada, California, Oregon, Utah, Texas, Arizona, Oklahoma and Montana. And it’s experienced strong YoY visit growth with August visits up 3.6% versus a year ago, and July even higher at 6.4%. The share of its visitors spending between 30 and 44 minutes in its stores grew from 27.4% last year to 30% this year. 

ShopRite & Price Rite. are both owned by Wakefern Food Corp., based in Keasbey, N.J., and cover a wide Northeast territory. But the two chains differ in their customer base. Price Rite is the discount sector while ShopRite is the full-priced grocery with many house brands. Smart planning has led its leaders to avoid overlap and hurt each other’s sales. As a result, both have experienced good monthly foot traffic, though Price Rite consistently outperforms ShopRite visits, probably due to its 20% lower prices, showing how important discount groceries can be in inflationary times. Shoppers at Price Rite also tend to come from areas with a median household income of $50.1K while ShopRite shoppers have a higher HHI of $88.3K. 

Market Basket is headquartered in New England’s Tewkesbury, Mass., and given the impressive title of top-ranked grocer for inflationary times by Dunnhumby. It’s been in existence for more than 100 years and now has 88 locations spread across New Hampshire, Maine, Rhode Island and in other Massachusetts sites. Visits were pared following Covid-19 versus a January 2020 baseline, but the chain moved ahead of the industry by January 2022. And since then, has fared better. The reason? Placer.ai credits strong loyalty with shoppers staging a boycott of the store when the board fired its company president. The chain has resisted adding self-checkout kiosks to foster interactions between clerks and shoppers. It’s also said to provide good value on fresh produce, quality meats, bakery goods and floral arrangements.