August 17, 2022
Amazon is rolling out its Amazon One palm-recognition payment system to additional Whole Foods Market stores across California. More than 65 Whole Foods in California will soon provide the Amazon One service, which lets customers use their palm to complete their purchase at checkout. Beginning this week, the technology became available at Whole Foods stores in Malibu, Santa Monica and Los Angeles, followed in the coming weeks by stores in other parts of Orange County, the San Francisco Bay Area, Sacramento and Santa Cruz. Amazon noted that the California expansion marks the first broad rollout of Amazon One at Whole Foods stores following launches in Seattle, Austin, New York City and Los Angeles. Click here to request a sample list of Whole Foods future store openings and closings.
Macy’s is expanding its partnership with WHP Global (the owner of Tru Kids, Inc.) to bring the Toys R Us brand to every Macy’s store during the 2022 holiday season. The rollout will continue through October 15, with in-store shops ranging from 1,000 square feet up to 10,000 square feet in flagship locations in Atlanta, Chicago, Honolulu, Houston, Los Angeles, Miami, New York and San Francisco. The new partnership may enable Tru Kids to regain relevance in the toy industry by capitalizing on the name recognition of Toys R Us, Inc., which liquidated in 2018. The relationship with Macy’s should provide Tru Kids with enhanced foot traffic, which could not be achieved in smaller standalone stores. Additionally, Macy’s financially strong consumer demographic should be able to better weather macroeconomic volatility.
In 2Q22, Ahold Delhaize reported consolidated net sales of €21.45 billion, up 15% compared to 2Q21 (up 6.4% at constant exchange rates). Overall, the top line was impacted by several factors, including inflation, comp growth of 4.7%, the aforementioned foreign currency translation benefits, acquisitions, and higher fuel sales. At Ahold Delhaize USA, net sales grew 7.7%, boosted by inflation, to $14.43 billion; comps, excluding fuel, advanced 6.4%. Food Lion continued to lead brand performance, now delivering 39 consecutive quarters of positive sales growth. The Company announced plans to invest $140 million in its Stop & Shop stores in NYC over the next two years. The investment is targeted at improving the shopping experience for local customers by adding thousands of new products that reflect the diversity of the neighborhoods and communities Stop & Shop serves. U.S. online sales were up 16.4% to $1.06 billion (7.3% of U.S. revenue) in 2Q, on top of 61% growth a year earlier.
Ace Hardware opened its 105th store in 2022, and it plans to open at least another 60 units by year end. To keep up with growth, the Company continues to invest in expanding its distribution network, with plans to add 4.4 million square feet of capacity by opening three new warehouses over the next five years. Ace operates more than 5,600 locally owned hardware stores (4,339 in the U.S.), including 840 opened in the past five years. Click here to request a sample list of future store openings.
Dillard’s was able to retain the strong sales generated in 2Q21, with 2Q22 sales up 1.2%, including flat comps. Quarterly gross margin fell 20 bps, although year-over-year inventory levels were in good shape, up just 7%. The Company ended the quarter with a $127 million net cash position. During 3Q, the Company plans to close stores in Texas and Missouri, and plans to open a new store in South Dakota, a new market, in fall 2023.
On August 31, Lidl US will open a new store on New York’s Long Island, in shopping center where a Best Market was formally located in Commack. The Company also recently opened stores in West Hempstead on Long Island and its first Baltimore location. Its first Brooklyn, NY store is slated to open in 2024.
Yesway recently opened a new concept store called Allsup’s Express in Lubbock, TX, adjacent to the campus of Texas Tech University. The Allsup’s Express store is a 3,000 square-foot bodega-style location focused on serving students with a tailored assortment of merchandise offerings.
Wendy’s 2Q22 revenues rose to $537.8 million from $493.3 million in the prior-year quarter. The Company said the increase was primarily driven by higher sales at owned restaurants due to the favorable impact of the acquisition of 93 franchise-operated restaurants in Florida during 4Q21 and higher same-store sales. Comps for the quarter were up 3.7% system-wide, with an increase of 2.3% in the U.S. and 15.2% internationally. Wendy’s commodity inflation was about 19% in 2Q, and labor inflation was 12%.
Wendy’s and Reef are slashing the number of restaurants they plan to open together by 2025, from an initial estimate of 700 announced last year to between 100 and 150 units. Wendy’s attributed the pipeline reduction to low unit volumes among the Company’s mobile food vessels in the U.S. The planned Reef units will be concentrated primarily in the U.K. and Canada. In these two markets, Reef locations generated the equivalent of $500,000 to $1 million in annual unit volumes. Comparatively, domestic Reef outposts have achieved $500,000 or less in yearly sales. Wendy’s will still grow its U.S. operations with Reef, however, targeting urban markets where the vessels can achieve high average unit volumes. Click here to request a sample list of future store openings.
Save Mart Supermarkets, which was acquired by Kingswood Capital Management in March of this year, announced it is “moving” its pharmacy scripts to Walgreens as it closes all of its 89 in-store pharmacies in California and Nevada. Though management did not comment, this asset sale could be used to generate a cash infusion to either allow the first distribution to the new owners or reduce the likely elevated LBO debt. A Company representative commented, “The Save Mart Companies is moving its pharmacy services at Save Mart and Lucky stores to Walgreens. Our Save Mart and Lucky Pharmacy staff will work closely with their patients to make this transition of services as convenient and seamless as possible.” Click here to request a sample list of future closings.
Primark opened a 34,200 square-foot store in downtown Philadelphia, PA. This is the chain’s 13th U.S. location and third in Pennsylvania (see current locations in the adjacent map). Primark offers bargain priced clothing for women, men and kids, as well as footwear, accessories, lingerie, homeware, and beauty. It also announced a freeze on prices for the back-to-school season. The Company does not operate an e-commerce site due to the high costs associated with selling online. Primark operates more than 395 stores in 14 countries; it made its U.S. debut in 2015 in downtown Boston, MA.
Meanwhile, Primark signed leases to open three new locations in Lake Grove, NY, Hanover, MD and Concord, NC. These will be the chain’s first in Maryland and North Carolina; the Lake Grove store joins six other units slated to open in New York and two existing locations in Brooklyn and Staten Island. Primark aims to reach 60 stores in the U.S. by the end of 2026. Click here to request a sample list of future openings.
The Creditors’ Committee in the Sears Holdings Corporation, DIP case approved a settlement agreement with former chairman Edward Lampert and other former shareholders, clearing a major hurdle for the Chapter 11 Plan to be declared effective. Previous lawsuits claimed Lampert allegedly stripped value from the Company through insider loans. We note that the Plan of Liquidation was confirmed (approved by the Court) in October 2019, subject to a delayed effective date, because all administrative claims had not yet been paid in full (the Plan was administratively insolvent). The settlement has the potential to provide full payment to administrative creditors, which would enable the case to be declared effective. A hearing on the proposed settlement is scheduled for August 31. Click here for more info.
Jack in the Box’s Company-wide sales (include Jack in the Box and Del Taco segments) increased 47.8% to $398.3 million, largely due to its acquisition of Del Taco in March 2022. However, Jack in the Box system-wide sales decreased 1.4%, with same-store sales down 0.6%. Franchise comparable sales were down 1% while Company-operated comps grew 3.5%. Higher average check, driven mostly by pricing, was more than offset by traffic declines for franchises, and only partially offset by traffic declines for Company-operated locations. As of the 3Q, and since the launch of the development program in mid-2021, Jack in the Box has 62 signed agreements for a total of 233 restaurants. Under these agreements, 13 restaurants have opened, leaving 220 remaining for future development. Net restaurant count was flat in 3Q, as the Company both opened and closed three locations.
System-wide sales for Del Taco, which Jack in the Box acquired this spring for $585 million, increased 3.3%. Franchise same-store sales were up 4.8%, and Company-operated same-store sales were up 2.3%. Sales were boosted by the quick-service chain’s value platform and an increase in average ticket size. Click here to request a sample list of future openings.
Checkers & Rally’s has been expanding rapidly with its 1,000 square-foot shops that offer double drive-thru lanes. Prefabricated construction (where components are made off-site in a factory, which are then transported and put together onsite) has allowed it to get its locations up and running fast. The Company has opened 11 new locations so far in 2022 and expects to have another 40 by the end of the year. According to the Company, it will continue to focus on multi-unit franchising agreements in California, Texas, Massachusetts, Connecticut, and North and South Carolina. Checkers & Rally’s reported executing 32 franchise and multi-unit development agreements so far this year. Further expansion involves both new and existing franchisees in Phoenix, California, New York, New Jersey and Connecticut. Click here to request a sample list of future store openings.
Grocery Outlet’s 2Q22 sales increased 15.7% to $897.7 million. Comps rose 11.2% and on a three-year stacked basis increased 17.9%. The Company opened seven new stores, ending the quarter with 425 stores in eight states.Adjusted EBITDA increased 18.3% to $60.1 million. Click here to request a sample list of future store openings.
Kroger and Acme Fresh Market have reportedly applied for licenses to have sports gaming kiosks at several locations in Ohio. Acme has been preapproved for a kiosk at nine locations, while Kroger has been preapproved for kiosks at 42 grocery stores across the state. Last year, Ohio joined many other states in legalizing sports betting; this week, Massachusetts became the 36th state (plus Washington, D.C.) to legalize it.
Hy-Vee is rolling out its Scan & Go program to more locations. It is bringing the mobile checkout technology powered by FutureProof Retail to an unspecified number of stores following a launch last year at select locations in Des Moines, IA. The technology is currently available at “several dozen” Hy-Vee locations. Click here to request a sample list of future store openings.
Starbucks is asking the federal labor board to suspend all mail-in ballot union elections nationwide, alleging misconduct in the voting process by the board’s personnel and the union organizing its employees. In a letter to the National Labor Relations Board, Starbucks claims that the labor board’s officials acted inappropriately during an election in the Kansas City area and has likely acted similarly in other elections. More than 220 Starbucks cafes in the U.S. have voted to unionize. An additional 34 elections have been ordered or are in progress, and seven more stores are waiting to schedule elections.
Publix recently opened a 39,210 square-foot store in Jacksonville, FL. The store is multi-level, with a Publix Liquors and parking garage located on the first level and the main store on the second level.
PublixPharmacy has rolled out curbside pickup to select Florida, Georgia, Alabama and Virginia locations, with plans to expand the service to North Carolina and South Carolina pharmacies. Click here to request a sample list of future store openings.
Kohl’s announced its Self-Pickup service is now available on eligible online orders at all of its 1,100 stores nationwide. Orders will be ready within two hours for in store pickup at a designated self-pickup area. Kohl’s had introduced drive-up curbside pickup in 2020 due to the pandemic, then began piloting self-pickup last year.
Trader Joe’s employees at a store in Minneapolis, MN voted to become the second location to unionize. The first was in Hadley, MA in late July. The union, Trader Joe’s United, was formed after a 55-5 vote was certified by the National Labor Relations Board on Friday. The victory follows recent wins by Starbucks and Amazon to unionize. Click here to request a sample list of future store openings.
The Fasula family, which currently operates 10 Gerrity’s supermarkets in Pennsylvania, has begun transitioning the stores to The Fresh Grocer brand, with the first opening last Friday in Scranton. The remaining Gerrity’s will all transition by mid-October. The Fresh Grocer is a registered trademark of Wakefern Food Corp.
Fareway Stores is expanding in Iowa by acquiring an independent store in Bondurant. The 20,000 square-foot outlet will officially change hands in early 2023, after which the Company plans to remodel the store. Fareway currently operates about 130 locations in Iowa, Nebraska, Minnesota, South Dakota, Illinois and Missouri. Click here to request a sample list of future store openings.
QuikTrip is launching a store in Tulsa, OK featuring the Amazon “Just Walk Out” technology. Originally available only in Amazon Go convenience and small-format grocery stores, the Company now licenses the technology to third parties. Click here to request a sample list of future store openings.
BP has opened its first Ampm convenience store in the Bronx, NY, also marking its first convenience store on the East Coast. The store will feature Ampm’s food menu, which includes a grocery section with fruit and dry goods, as well as a hot deli. Customers can also order Ampm’s food for delivery via DoorDash. BP said it intends to leverage its large footprint to expand Ampm on the East Coast, with three other store openings already scheduled.
Saks Fifth Avenue will close its last store in Mexico this October. The store is located in Plaza Santa Fe in Mexico City and is operated by Carlos Slim’s Grupo Sanborns.
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