Stop & Shop to Close Approximately 40 Stores as Part of Turnaround Strategy

Stop & Shop, a grocery chain famously featured in the 1996 film "Happy Gilmore," is set to close around 40 storefronts as part of a strategic shift to optimize its store network. The closures, which span multiple states in the Northeast, are aimed at focusing on better-performing locations and strengthening the business for the long term, according to company officials.

This latest round of closures follows an earlier announcement in 2024 to shut down 32 underperforming stores. The recently identified locations slated for closure include stores in Basking Ridge, Westfield, and Toms River, New Jersey, as well as Clinton, Connecticut. These stores are expected to cease operations by the end of the year. Combined with the previously announced closures, approximately 40 Stop & Shop stores will have closed or are earmarked for closure within a two-year period.

The Massachusetts-based retailer, which operates more than 350 stores across Connecticut, Massachusetts, New Jersey, New York, and Rhode Island, is owned by Dutch grocery conglomerate Ahold Delhaize. A spokesperson for Stop & Shop stated that the decisions to close individual stores were made independently and are not part of a broader plan to shutter multiple locations, emphasizing that no additional closures are planned for these specific markets at this time.

Employees at the affected stores will be offered opportunities to transfer to nearby locations where possible. Earlier in the year, Stop & Shop closed seven dedicated e-commerce fulfillment centers. The company is transitioning to a model where store employees pick online grocery orders directly from supermarket shelves. Concurrently, Stop & Shop has invested in modernizing its remaining stores, with roughly half of its estate undergoing remodeling since a revitalization campaign began in 2018.

JJ Fleeman, CEO of Ahold Delhaize USA, indicated that the company conducted a thorough review of its portfolio before making the "difficult decisions" to close underperforming stores, aiming to establish a healthy store base for sustained success.

The grocery industry is currently facing significant challenges. Traditional supermarket chains are contending with intense competition from large retailers like Walmart and Costco, discount grocers such as Aldi and Lidl, and the growing popularity of online grocery services. These factors, combined with rising labor, transportation, and operating costs, are putting pressure on profit margins, which are typically thin for supermarkets.

Customers are also becoming more price-conscious, often shopping at multiple retailers or opting for lower-cost private-label products. The U.S. Department of Agriculture projects continued food price increases, adding further pressure on both retailers and consumers. Grocery prices saw a 2.7 percent rise in June, according to the latest Consumer Price Index.