THE FRIDAY 5: Hy-Vee’s Big Acquisition; Amazon’s Grocery Potential
Welcome to The Friday 5, Progressive Grocer’s weekly roundup of the top news and trends in the food retail industry. Each Friday, we’ll take a look at the stories that are most important to our readers and also keep tabs on the trends that are poised to impact grocers.
1. Hy-Vee Acquiring Strack & Van Til
A big move by Midwest regional player Hy-Vee to acquire a smaller independent grocer garnered the most clicks from PG readers this week. Hy-Vee revealed that it is in the process of acquiring the Strack & Van Til Food Market chain, also known as Indiana Grocery Group LLC, which operates store locations throughout northwest Indiana. The deal will add 22 stores to Hy-Vee’s 550-plus retail business units, which include grocery stores, drug stores, pharmacies, restaurants and convenience stores.
Strack & Van Til will keep its name and operate as a subsidiary under Hy-Vee Inc., in common with the parent company’s other subsidiaries, which include Midwest Heritage, Perishable Distributors of Iowa, D&D Foods, Amber Specialty Pharmacy, Vivid Clear Rx, and Wall to Wall Wine and Spirits.
With the acquisition expected to close in early May, Hy-Vee has become a member of Kansas City, Kan.-based Associated Wholesale Grocers, which supplies Strack & Van Til’s stores in northwest Indiana. Hy-Vee’s grocery stores will continue to be served through its own supply chain facilities in Ankeny, Chariton, Cherokee and Cumming, Iowa.
2. Fresh Market, Hannaford, SpartanNash in Expansion Mode
It was a big week for expansion news, with Hannaford Supermarkets officially welcoming customers to its new stores in Fort Kent and Madawaska, Maine. The grand openings follow the food retailer's acquisition of the stores earlier this year, which formerly operated as Paradis Shop ‘n Save Supermarkets and were supplied and supported by Hannaford.
Additionally, food solutions company SpartanNash announced that it is acquiring Metcalfe’s Market, a three-store Wisconsin grocery chain founded in 1917. The Madison and Wauwatosa, Wis., locations will retain all current employees, and former owners Tim and Kevin Metcalfe will join the SpartanNash family of associates. The Metcalfe’s Market storefront, branding and core shopper experience will remain in place.
The Fresh Market’s expansion in Florida also garnered clicks this week. The retailer is set to host a grand opening for a location in the Bradenton area on April 24. The outpost at 11525 S.R. 70 East in the Lakewood Ranch community anchors a shopping center and fills a space that once housed Earth Fare and Winn-Dixie stores.
3. PG Puts the Focus on Sustainability
Readers were eager this week to find out more about Progressive Grocer’s 2024 class of the most sustainable grocers. Indeed, given that so many consumers have the planet’s health on their minds, it makes sense that most forward-looking grocery retailers do, too.
PG chose 10 exemplary supermarket companies with wide-ranging sustainability efforts, encompassing such areas as store design and landscaping, packaging, product sourcing, food waste, refrigeration, fleet mileage, and more. The operators range in size from chains that are part of sprawling multinational businesses to a regional cooperative grocer with just 15 locations to a pure-play e-grocer with no brick-and-mortar stores at all, but they all share an unwavering commitment to advancing policies designed to help save the earth, as well as to effectively publicize their environmental, social and governance efforts and achievements.
Find out which grocers were chosen and how they’re making a sustainable difference.
4. Amazon Shares New Grocery Tactics
Amazon was in the news this week for its grocery efforts. In his annual letter to shareholders, President and CEO Andy Jassy addressed several aspects of the retail behemoth’s grocery business, sharing that Amazon is pursuing simultaneous paths to grocery growth. Jassy noted that the company can leverage its 58 same-day fulfillment facilities within its store business to provide a better grocery-shopping experience for customers. While Amazon is working on enhancements to its Amazon Fresh stores and growing its organic grocery sales with Whole Foods, the same-day facilities also have great potential, he said.
Jassy reported that Amazon’s Prime Air delivery drones are making progress and will eventually allow the company to deliver packages to customers in less than an hour. In line with other recent movements fusing health care and grocery, Jassy also shared that customers are asking Amazon to help them with health and wellness opportunities, adding that those options “can be partially unlocked with some of our existing grocery building blocks, including Whole Foods Market or Amazon Fresh.”
Moreover, after numerous reports that Amazon was removing its Just Walk Out technology from its Fresh banners, the company released an update confirming that it's currently focused on using the technology in small-format retail, while its Dash Carts will be applied to grocery and large-format stores. According to Amazon, customers prefer Amazon Dash Cart in larger grocery stores, where they make big weekly trips and buy a greater number of items.
5. ALDI Introduces Checkout-Free Grocery Shopping
ALDI and Grabango have rolled out ALDIgo checkout-free shopping at a Chicago-area suburban grocery store, making the deep discounter the first major U.S. grocery retailer to implement checkout-free technology in an existing full-size store. Grabango’s system was deployed without making any changes to the store’s planogram or product displays, and the technology, which uses computer vision to identify and track every item in the store, enables shoppers to leave without waiting in line or scanning items.
“The launch of ALDIgo is a pivotal moment for the grocery industry,” asserted Will Glaser, CEO of Berkeley, Calif.-based Grabango. “Although more challenging, it was important to us to launch this technology in a typical store, and not one purpose-built for us. ALDI is one of the most innovative retailers in the world, and we are honored to partner with them to give their shoppers an exciting new way to shop the store.”
