Aldi tops among expanded chains in 2023; Family Dollar to close 1,000 stores

According to the 2024 Grocery Report from JLL, the fastest-growing grocery store chains added 253 new U.S. locations in 2023, or around 8.4 million square feet of new retail space.

Discounter Aldi led the expansion with 109 new store locations and tagged the “most aggressive” with new store expansion last year. One of those new stores opened in Springdale on Elm Springs Road giving the local region its fifth Aldi location. Aldi also recently disclosed plans to add 800 more stores nationwide by the end of 2028. The store additions will be a combination of new openings and store conversions.

Aldi completed its acquisition of Southeastern Grocers and the Winn-Dixie and Harvey’s Supermarket banners. The deal added 400 stores in Alabama, Florida, Georgia, Louisiana and Mississippi. Aldi plans to invest more than $9 billion over the next five years in store expansions and new locations.

“Our growth is fueled by our customers who are asking for more Aldi stores in their neighborhoods nationwide,” said Aldi CEO Jason Hart. “With this commitment to add 800 stores in the next five years, we’ll be where our shoppers need us while positively impacting the communities we serve.”

In addition to organic growth through new store openings, Hart said a significant number of Winn-Dixie and Harvey’s Supermarkets will convert to the Aldi format over the next several years. Aldi will begin the store conversions by mid-summer, anticipating that approximately 50 stores will begin the conversion process during the latter half of 2024, with the majority reopening as Aldi in 2025.

With more than 2,200 stores in 38 states, Batavia, Ill.-based Aldi U.S. has more than 45,000 employees.

OTHER RETAILERS
Publix ranked second with 38 new stores opened last year. Sprouts Farmers Market opened 30 stores, up 87.5% increase from 2022, the report states. Sprouts opened its 400th store last year in Haddon Township, N.J.

Grocery Outlet opened 29 new stores, up 7.4% from 2022, and Lidl opened 16 stores. Texas giant H-E-B opened eight locations, up from five in 2022. Kroger opened eight stores. Midwestern grocer Hy-Vee opened seven stores in 2023. Whole Foods Market also opened eight stores, down from 11 in 2022. Whole Foods’ second location in Northwest Arkansas is under construction in the Pinnacle Hills area of Rogers and is expected to open in early 2025.

JLL also reported online grocery delivery and pickup services have become a common feature in the grocery industry, with more grocers offering these services. Grocery e-commerce sales are forecasted to rise nearly 80% in the next four years, exceeding $330 billion by 2027

FAMILY DOLLAR CLOSURES
Chesapeake, Va.-based Dollar Tree, the parent of Family Dollar, said Wednesday (March 13) it plans to close 600 Family Dollar stores in the first half of this year. About 370 more Family Dollar locations and 30 Dollar Tree stores will also close over the next couple of years as each store’s lease expires.

The company has not released the list of slated closures. Dollar Tree also said it has undergone an extensive review of its store portfolio to identify underperforming assets. The discount chain is no stranger to operational hardships. Family Dollar was acquired by Dollar Tree in 2015 for $8.5 billion.

Just last month, Dollar Tree reached a resolution with the U.S. Department of Justice investigation of the Family Dollar distribution center in West Memphis, Ark. The company agreed to enter a plea of guilty to a one-count misdemeanor violation relating to acts that caused adulterated product after the investigation revealed rodent infestation. The company said the distribution center would reopen by May.

The retailer also experienced a cyberattack that exposed the names, dates of birth and social security numbers of former and current Dollar Tree and Family Dollar employees, affecting some 2 million individuals.

Dollar Tree operates 16,622 Dollar Tree, Family Dollar and Dollar Tree Canada stores in 48 states and five Canadian provinces.