THE FRIDAY 5: Kroger Sets Its Sights on E-Comm; Costco Posts Mixed Q2

1. Kroger Sets Its Sights on E-Commerce

Readers were most interested this week in news that Kroger is moving full steam ahead on omnichannel strategies to enhance both its operations and customer experiences. The retailer is launching a new e-commerce business unit aimed at centralizing and expanding its already-strong digital initiatives, which will be led by Yael Cosset in the role of EVP and chief digital officer. 

Cosset guided Kroger’s recent technology transformation to improve personalization and convenience for shoppers while also enabling associates to focus on service. His background in the tech functions at Kroger includes leadership of the 84.51˚ insight and media subsidiary and the Kroger Precision Marketing (KPM) retail media unit, among other portfolios. 

Also this week, it came to light that Kroger is piloting two different aisle-roving robots in its Cincinnati and Indianapolis markets. The autonomous robots, Tally and another dubbed “Barney” after the grocer’s founder, are being used for real-time inventory management and pricing accuracy. 

“We are always exploring new ways to create a more convenient and friendly customer experience,” Kroger told the Cincinnati Enquirer in a statement, also noting that utilizing the robots “means our associates can more easily and quickly identify and address shelves where products are low or out of stock.”

2. Costco Members Remain in Caution Mode

News of Costco’s mixed Q2 financial results made waves this week, with the wholesaler seeming to have gotten caught in some of the market headwinds that are impacting businesses across the retail landscape. Revenue came in higher than expected at $63.7 billion, above the market estimate of $63.1 billion. Same-store sales rose 6.8% during Q2 and U.S. comps were up 8.3% for the reporting period. 

Meanwhile, adjusted earnings per share were $4.02 during Q2, slightly lower than analyst expectations, with a net income of $1.78 billion. According to EVP and CFO Gary Millerchip, the recent membership fee hike contributed about 3% of fee income in the quarter.

President and CEO Ron Vachris acknowledged some of the macroeconomic headwinds during the company’s March 6 earnings call. “As we look ahead to the remainder of this fiscal year, headwinds from foreign exchange look likely to continue. Given events over the last week, it is difficult to predict the impact of tariffs, but our team remains agile and our goal will be to minimize the impact of related cost increases to our members,” he said, noting that about a third of Costco’s U.S. sales are from items imported from other countries, and less than half of those are items coming from China, Mexico and Canada. 

“In uncertain times, our members have historically placed even greater importance on the value of high-quality items at great prices," he said. "And our teams will continue to rise to this challenge by leveraging our global buying power, strong supplier relationships and innovation.”

3. Walgreens Makes Deal to Go Private

After much speculation, news broke that Walgreens Boots Alliance has agreed to be acquired by an entity affiliated with New York-based private equity firm Sycamore Partners. The deal is estimated at $23.7 billion and is expected to close during the fourth quarter of 2025.

A public company since 1927, Walgreens will continue to operate under that name as part of a portfolio of brands that also includes the UK-based Boots chain. The headquarters will remain in the Chicago-area suburb of Deerfield. 

The agreement follows a sometimes-tumultuous past few years, as Walgreens announced more than 1,200 store closures and stocks were up and down. Leaders say that the company is better positioned to maintain leadership in pharmacy, retail and health services.

4. On the Ground at The NGA Show

PG Editorial Director and Associate Publisher Gina Acosta attended this year’s National Grocers Association’s event, taking to the floor and sussing out important trends. From a packed Technology Innovation Summit to an M&A-focused Financial Symposium — plus several uplifting awards ceremonies celebrating grocery legends — this year’s NGA Show, which featured 340-plus exhibitors, 50-plus education sessions, and a record 3,700-plus attendees gathered in Las Vegas, offered up insights that independent grocers can apply to navigate industry challenges and drive success in their businesses in 2025. 

Read on for more insights.

5. Fresh Market Launches New Retail Concept

The Fresh Market has opened its first-ever adult beverage retail concept on March 7. The new Spirits & Wine store is located adjacent to The Fresh Market’s Ponte Vedra Beach, Fla., grocery store location.

The more than 7,000 square feet of retail space is dedicated to a carefully curated range of spirits, including bourbon, whiskies, rums and vodkas, alongside a comprehensive wine selection ranging from European to domestic offerings, craft beers and chilled beverage coolers. Additionally, the Spirits & Wine store offers assorted mixers, snacks, glassware, and wine by the glass. 

“We are very excited about our new Spirits & Wine store and expanding our brand into a new retail concept,” The Fresh Market CEO Brian Johnson told Progressive Grocer. “We strive to make everyday occasions extraordinary by helping our guests discover new tastes and experiences from around the world. We feel Spirits & Wine is a natural extension of that mission.”