Kroger, the nation's largest supermarket chain, is set to close approximately 60 "underperforming" stores across the United States, a move that includes shuttering two locations in California. This retail consolidation is part of a broader strategy to reallocate resources to more successful stores and introduce new formats.
In California, the closures will affect a Food 4 Less store in Santa Clarita and a Foods Co. store in Sacramento. The Santa Clarita location is slated to reopen as a Ralphs, another Kroger-owned banner.
Strategic Consolidation and Expansion
The company views these closures not as a contraction but as a strategic consolidation. In some regions, such as West Virginia, Kroger is actively transitioning shoppers to newly developed "Kroger Marketplace" facilities. This includes a recently opened 122,000-square-foot marketplace in the region, valued at $40.3 million.
These store closures are occurring even as Kroger pursues significant expansion through acquisitions. The company announced a $1.65 billion deal to acquire Giant Eagle, a Pennsylvania-based supermarket chain. This acquisition, expected to be finalized in 2027, will add 197 supermarkets and 11 standalone pharmacies to Kroger's extensive network. Kroger operates over 2,700 stores nationwide under various regional brands, including Ralphs, Fred Meyer, Harris Teeter, and King Soopers.
Kroger CEO Greg Foran stated that the Giant Eagle acquisition offers a clear strategic fit, expanding the company's reach into "attractive adjacent markets" and allowing Kroger to continue its focus on store operations, fresh foods, convenient meal solutions, and customer service.
Broader Industry Trends
This move by Kroger comes as other major grocery chains, such as Albertsons, are also undergoing significant transformations. Albertsons is reportedly accelerating investments aimed at lowering prices and has reorganized its operational structure, consolidating 11 divisions into four regions to improve accountability and execution in key areas like fresh service, store standards, local merchandising, and community connection. These efforts aim to boost customer traffic, product sales, and loyalty.
California continues to face high grocery costs, with weekly grocery spending averaging $127 per household in 2025, making it the third most expensive state for groceries after Hawaii and Alaska.