Top 50 Grocers: Independents Make Gains; Hispanic Grocer Bodega Sees Huge Jump
(Editors' note: This is the last part of a three-part series.)
Taking a look at the Super 50, once you get out of the top 10, you begin to see the power of the independents.
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Half of the grocery companies in the rankings are majority family-owned, employee-owned or privately held — meaning that they answer to no one but their customers. That’s a loose definition of an independent grocer, and one that many of the smaller independents probably won’t agree with. But it does go to the point of the power of independents in driving the industry.
And it is where most of the “action” is happening. The rankings of the top four grocers have remained unchanged for the past three years, and the top five have been the same, although some have jockeyed for position a bit, since at least 2015.
But take a look at the middle and below — that’s where the real action is, especially among independent operators.
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Tewksbury, Mass.-based Demoulas Super Markets, under the name Market Basket, has emerged from the drama of interfamily lawsuits to hit its highest ranking since 2015. It had hovered right in the middle of the pack with rankings from 25th to 27th until this year, when it leapt to 18th place. Sales this year were $5.2 billion, up from $3.4 billion last year.
But making the biggest jump among indies was Bodega Latina Corp., which jumped from No. 48 last year to No. 34 this year with sales of $2.4 billion.
Regional Grocery Chains Top Consumer Reports Ranking
In Consumer Reports’ latest ranking of grocery stores, regional chains led the pack, with H-E-B’s Central Market netting the top spot, with a ranking of 91 out of 100, when it comes to overall customer satisfaction.
Next was Wegmans Food Markets, with 90, followed by Heinen’s, with 89. Then there was a tie among Gelson’s Markets, Market Basket and Trader Joe’s (the highest-ranking national chain), all scoring 87. Rounding out the top scorers was a five-way tie, at 86, for Crest Foods, Fareway Stores, New Seasons Market, Costco Wholesale and Publix Super Markets.
The list ranks the top 96 grocers, the most that the publication has ever had on the list, based on results from 75,000 Consumer Reports members who provided ratings of the one or two supermarkets they visit most often, according to several criteria, including cleanliness, price, food quality and variety, checkout speed and staff helpfulness, selection of healthy options and locally produced foods, and variety of international and multicultural foods.
Price was a big factor for consumers and was the No. 1 reason that they gave for no longer shopping a particular banner. Trader Joe’s and Market Basket were the top-ranking stores when it came to competitive pricing.
Trader Joe’s, H-E-B’s Central Market and Costco all garnered top marks for quality.
This year also marked the first year that Consumer Reports ranked online grocery delivery services. Shipt, owned by Target, came out on top with a ranking of 79. These ratings were gathered from Consumer Reports members who noted in the 2018 survey that they used the services, and accounted for 7 percent of those surveyed in 2019.
The rankings for other grocery delivery services were Amazon Prime Now, which offers same-day delivery from Whole Foods Market, at 75; Peapod, with 72; FreshDirect and Instacart, tied at 70 and AmazonFresh, with 66.
In last year’s rankings, it barely cracked $1 billion in sales, but the number of locations jumped from 59 to 125 due to acquisitions, including the 63 stores it gained when it purchased Fiesta Mart at the end of the first quarter last year. It’s now one of the largest Hispanic-themed chains in the country.
“The acquisition of Fiesta allows us to meaningfully expand into Texas via an established, well-known operator,” Carlos Smith, president and CEO of Paramount, Calif.-based Bodega Latina, said at the time of acquisition. “Through the combination of the strengths of our two organizations, we will be well positioned to significantly accelerate our vision of efficiently offering high-quality products at the lowest possible prices.”
While Bodega’s ascent came by acquisition, sales grew by about $54 million (from the combined sales of the two chains last year), which demonstrates the split in where shoppers are choosing to spend their money. On one end of the spectrum, they’re choosing specialty markets like the ones Bodega operates, while the other end is discount stores.
Other independents, like Thibodaux, La.-based Rouses Supermarkets, are also benefiting from consumers’ choice to shop specialty. Rouses makes its Super 50 debut this year, at No. 47. Like Bodega Latina, it has also made strategic acquisitions in recent years, including fellow independent LeBlanc’s in 2016 and three locations of Frank’s Supermarkets last year.
Regional and independent chains are attracting attention, many because they’re often well regarded by their shoppers. The four highest-ranking grocery chains in a recent Consumer Reports survey (see sidebar) were independently owned regional chains H-E-B’s Central Market, Wegmans, Heinen’s and Gelson’s.
Central Market, as part of the San Antonio-based H-E-B, ranks sixth on PG’s 2019 Super 50 list, while Wegmans comes in at No. 16. Chains like these may be exactly what Amazon is looking for to expand its brick-and-mortar footprint outside of Whole Foods Market.
Amazon’s acquisition of Austin, Texas-based Whole Foods was top of mind for many of last year’s Super 50 companies, and this year, it’s the news that the Seattle-based internet behemoth plans to launch a separate grocery chain. Word on the street indicates that this new concept could open in the Los Angeles area sometime before the end of this year, with growth coming from the acquisition of regional brands.
These smaller, independently owned regional chains have a handle on what their customers want, and have the agility to change to meet shifting demands quickly, which continues to garner them sales — and attention.
|2019 Rank||2018 Rank||Company||Fiscal Year-End Sales (000)|
|2||2||The Kroger Co.||$121,162,000|
|3||3||Albertsons Cos. Inc.||$62,179,000|
|4||4||Ahold Delhaize USA||$48,090,120|
|5||5||Publix Super Markets Inc.||$36,100,000|
|8||7||Wakefern Food Corp.||$16,500,000|
|10||8||Amazon (as Whole Foods Market)||$15,887,300|