THE FRIDAY 5: Albertsons Makes Moves Following Failed Merger; UNFI’s Strategic Realignment

1. An Exclusive Look at UNFI’s Realignment

Readers this week were interested in PG Editorial Director and Associate Publisher Gina Acosta’s exclusive interview with UNFI CEO Sandy Douglas about the company’s strategic realignment. UNFI will restructure its commercial wholesale organization as part of a multi-year strategy launched in October to provide more customized value to customers and suppliers. 

The restructuring effort will organize its wholesale operations into two distinct, product-centered divisions: Conventional Grocery Products, and Natural, Organic, Specialty & Fresh Products. Each division will feature dedicated sales teams aligned to the unique product and service needs of the customers it serves. 

“UNFI is uniquely positioned to help grocers navigate this complex environment. Our scale, expertise, and commitment to innovation enables us to deliver the products, programs, and services our customers need to succeed,” said Douglas. “By fostering collaboration across the supply chain and investing in our people, we’re building a stronger, more resilient industry for the future. And I’m really excited about the talented team we’ve recruited and built to take the company forward.” 

2. Grocers Affected by L.A. Wildfires

The wildfires raging through the Los Angeles area have captivated the nation and have affected local grocery businesses. At least two stores have been destroyed, and others severely damaged. NBC News reporter Jacob Soboroff reported live from the charred remains of a Kroger-owned Ralphs supermarket in Pacific Palisades, a community of about 23,000 residents that was the epicenter of much of the destruction. 

“Our thoughts are with everyone impacted by the devastating fires in California, and we appreciate the amazing work being done by first responders in the region. We can confirm our Ralphs store in the Palisades was lost to the fire, and fortunately, all associates were safely evacuated from the location,” a Kroger spokesperson told Progressive Grocer. “With safety as top priority, we will continue to work with law enforcement and emergency responders to monitor affected areas. We look forward to coordinating with the American Red Cross and elected officials to make sure those displaced from their homes have access to fresh food and water.”

A nearby Gelson's Markets structure was also damaged in the Palisades fire that was fueled by hurricane-strength winds off the coast. “With a heavy heart, we share that our Palisades store has been completely lost to the fires. This store was more than just a place to shop — it was a cornerstone of the community, and we grieve this loss alongside the team members, customers, and neighbors who called it their own,” said President and CEO Ryan Adams in a letter to customers shared on the company website. 

According to local media reports, an ALDI store in the town of Altadena was ruined by the separate Eaton wildfire that also ravaged tens of thousands of acres in the greater Los Angeles area.

3. Albertsons Moving Forward

News from Albertsons Cos. was in the spotlight this week, including its Q3 earnings report. Albertsons saw net sales and other revenue increase 1.2% to $18,774.5 million for the 12 weeks ended Nov. 30, driven by a 2% rise in identical sales. The company said growth in pharmacy sales helped increase identical sales. Digital sales during the quarter increased 23% during Q3, while loyalty members increased 15% to 44.3 million. 

"We delivered solid operating and financial performance in the third quarter of fiscal 2024 in an environment where the consumer remains cautious," said Sankaran. "Investments in our Customers for Life strategy drove increased digital engagement across our platforms, evidenced by strong growth in our digital sales, pharmacy operations, and membership in our loyalty program.”

Also in the news was the opening of Albertsons’ search for innovative independent brands through its third annual Innovation Launchpad competition. The grocer is looking specifically for products in areas including functional beverages, hydration, sober-curious beverages, low sugar or carb, protein solutions, global flavors, healthy meal solutions, and premium pet items. Three winners will receive prizes valued at more than $300,000 total, including cash and industry services. 

Separately, Albertsons Media Collective, the grocer’s retail media arm, announced a new AP and a new partnership that will make it easier for its advertisers to integrate the company’s campaign performance data into their own measurement models for analysis.

4. Expansion for Lidl, H Mart

New store news from Lidl and H Mart garnered reader attention this week. Lidl US will open a new location in New York City on Jan. 29 at Brooklyn's Gateway Center. New York is one of three strategic markets where the grocer is focused on growing its footprint – the others being Atlanta and Washington D.C. 

H Mart, meanwhile, is unveiling two new stores this month. A location in Somerville, Mass., northwest of Boston, opened on Jan. 9, and another will cut the ribbon in Urbana, Ill., near the campus of the University of Illinois Urbana-Champaign, on Jan. 16.

5. H-E-B Takes Top Spot in Retailer Preference Index

PG readers were interested in the news that Texas-based H-E-B again took the top spot in dunnhumby’s eighth annual Retailer Preference Index (RPI). The supermarket chain has held the RPI’s top spot for three of the past four years, which dunnhumby attributed to its long-term customer value proposition. 

Market Basket (No. 2), Costco (No. 3, as well as No. 1 in the Canadian RPI), WinCo Foods (No. 4) and ALDI (No. 5) made up the rest of the top five.