Kroger’s to buy Roundy’s: More consolidation on the horizon?

The announced acquisition of the Roundy’s stores (Pick N’ Save, Mariano’s, Copps) is of special interest here, because Roundy’s is a hometown Milwaukee retailer. I describe it (on RetailWire) as a “tale of two companies,” including some valuable assets for the Kroger’s portfolio as well as some underperforming stores:

The success of Mariano’s certainly gives Kroger a foothold in the Chicago market, and a vehicle for brand positioning much different from Jewel or the big discounters’ grocery operations. Mariano’s may be the prize posession but is a relatively small part of Roundy’s portfolio.

Roundy’s still generates most of its sales from its mid-market Pick ‘n Save and Copps locations here in Wisconsin. These stores have steadily lost market share to Woodman’s, Walmart, Aldi, Costco and now potentially Meijer. And, frankly, Roundy’s has been slow to expand its Metro Market concept (the local version of Mariano’s) fast enough while the upscale (and locally owned) Sendik’s chain has expanded rapidly.

As a shopper at my neighborhood Metro Market and Pick ‘n Save (about five miles apart from each other), I hope Kroger management brings better operating attention to detail to the market. Long checkout lines, expired dairy, and an overabundance of private brand have not helped Roundy’s win the market share war. Meanwhile, Mr. Mariano has been more focused on his personal re-entry into Chicago, having lost his job at Dominick’s to another takeover several years ago.

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