Martin's remains No. 1 in grocery rankings, but rivals gaining ground
The produce department of the Martin's Food Markets store in Midlothian............
Posted: Tuesday, June 23, 2015 12:01 am
As the battle for the Richmond area’s grocery dollars continues to intensify, Martin’s Food Markets maintained its grip as the market share leader for a third straight year with 15.42 percent of grocery sales.
Martin’s market share, however, eroded more than a percentage point from a year ago. Food Lion also lost market share, slipping from second place to third in the rankings and seeing its share also decline nearly a percentage point.
Gaining ground in the past year were Walmart and Kroger.
Walmart — which added three Richmond-area stores including two in its smaller grocery-only Neighborhood Market format — moved to second place with a 15.09 percent share, according to the annual grocery market survey by Food World, a Maryland-based industry publication. It had been No. 3 in 2014.
Kroger increased its share by more than a percentage point but still ranks fourth with nearly 13.05 percent.
The results are based on food sales for the 12 months that ended March 31.
Jeffrey W. Metzger, Food World’s publisher, said the survey — released online Monday and published in its June issue — chronicles a market that is crammed with options for the grocery shopper.
“There is no other place like Richmond in the areas we cover,” said Metzger, whose publication keeps tabs on the industry from New York to Virginia.
“There are other markets that are over-stored, but in those markets the expansion has slowed,” he said. “For whatever reason, if a grocery company wants to expand or test a concept, Richmond is the place.”
Metzger pointed to the recent entry of the super-frugal Aldi chain into the Richmond area, Kroger’s Marketplace stores, new and expanded Martin’s stores and plans for a new Whole Foods Market store at 2024 W. Broad St. near the Fan District.
“Next year, Wegman’s will open a couple of its stores in the Richmond market,” he said. “They’ll appeal to the high-end customer. And Lidl, another no-frills chain, is getting ready to move in a year or two after that.”
“There is going to be fallout,” he said. “Wegman’s will have impact on Kroger and Martin’s and some of the upscale stores like Whole Foods. Aldi and Lidl will hit Food Lion and other stores where price is such a big factor.”
Metzger said Martin’s stay as No. 1 could be nearing an end. The chain’s 15.42 percent share in this year’s survey was down from 16.52 percent a year ago and 16.67 percent the year before that.
“Martin’s isn’t standing still,” Metzger said. “They have expanded stores and opened new stores to replace smaller, older stores. But they still haven’t gotten the traction they want in Richmond.”
Metzger said another year or two might see Walmart and Kroger as the two brands at the top of the Richmond market. Walmart’s 15.09 percent share in this year’s survey is up from 14.19 percent a year ago. Kroger’s 13.05 percent this year is up from 11.84 percent a year ago.
“Kroger is going to feel the impact of Wegman’s opening,” Metzger said, “but Kroger has been gaining a lot of ground and they’re not done.”
Walmart spokeswoman Amanda Henneberg said Walmart’s upward trajectory in the Food World rankings “validates Walmart’s commitment to expanding our grocery offerings in the greater Richmond area.
“Richmond continues to be a strong market for Walmart,” Henneberg said, “and most importantly our customers are pleased with our introduction of smaller-format Neighborhood Market stores.”
The two area stores in that format — one at 5700 Hopkins Road in the Meadowbrook Plaza shopping center in Chesterfield County, the other at 9714 Sliding Hill Road near Atlee Station Road in Hanover County — opened in March. More are planned this year.
The stores are about 40,000 square feet and sell almost only groceries, as opposed to a Walmart Supercenter, with a wide array of merchandise in 180,000 square feet.
Walmart also opened a scaled-down Supercenter, about 90,000 square feet, in the Reynolds Crossing development in western Henrico County during the survey period.
Henneberg said the chain has received positive feedback regarding the smaller stores.
Walmart grocery customer traffic is increasing and shoppers are buying more fresh items, Henneberg said. The chain also is “developing growth categories like organics, healthy snacking and easy-prep meals,” she said.
Martin’s is pleased to lead the Food World’s rankings for a third straight year, said John MacDonald, the chain’s director of marketing and external communications.
“Richmond customers continue to respond favorably to Martin’s combination of quality, selection, savings and fresh convenient offerings,” he said. “We also continue to be a great community partner working with a variety of local organizations that are helping to fight hunger, improve the lives of children and build healthy communities.”
Martin’s announced last month that it will close one of its smaller stores, at the Dumbarton Square shopping center in western Henrico, in July.
“Last fall, we introduced customers to our first brand-new Richmond area store in Midlothian featuring the latest Martin’s prototype,” MacDonald said, “and next year we will open our second brand-new store in Chester.”
Kroger, the nation’s largest traditional supermarket retailer, continues to expand in the region including opening its larger format Marketplace stores.
It expanded its Rutland Commons store in Hanover to a Marketplace size. And a Marketplace store on Iron Bridge Road in Chesterfield should open this fall.
Kroger also has plans for a 90,000-square-foot store in Colonial Heights and is expanding its Village at Swift Creek store off Hull Street Road in Chesterfield.
Food Lion, which saw its share slip to 14.57 percent from 15.39 percent a year ago, closed two stores.
For stores that opened anytime during the 12-month survey period, such as the Walmart Neighborhood Market stores, Food World estimates what the sales would have been for the entire year. Conversely, sales in stores that closed during the survey period are not counted.
In addition to the competition among traditional grocery chains and Walmart’s Supercenters and Neighborhood Market stores, other outlets continue to appeal to grocery shoppers.
After the top four spots in the Food World survey, combining for nearly 60 percent of the area’s grocery spending, the next nine spots in the rankings are occupied by nontraditional grocery options — CVS, Target, Wawa, Walgreens, 7-Eleven, Sam’s Club, Rite Aid, Costco and BJ’s Wholesale Club — that claim more than 33 percent of the market spending.
“It’s just going to get more crowded these next two or three years,” Metzger said. “This could be the beginning of a sea change in the Richmond market.”
| Rank | Company | 2015 Stores | 2015 Sales (in millions) | % of 2015 Market | 2014 Stores | 2014 Sales (in millions) | % of 2014 Market |
|---|---|---|---|---|---|---|---|
| 1 | Giant/Carlisle (Martin’s) | 22 | $549.24 | 15.42% | 23 | $575.40 | 16.52% |
| 2 | Wal-Mart (SC/Neighborhood Mkt) | 16 | $537.50 | 15.09% | 13 | $494.20 | 14.19% |
| 3 | Food Lion | 45 | $518.90 | 14.57% | 47 | $536.00 | 15.39% |
| 4 | Kroger (Marketplace) | 17 | $464.80 | 13.05% | 16 | $412.50 | 11.84% |
| 5 | CVS | 53 | $227.40 | 6.39% | 48 | $202.10 | 6.04% |
| 6 | Target | 12 | $183.10 | 5.14% | 12 | $183.80 | 5.28% |
| 7 | Wawa | 24 | $178.24 | 5.01% | 23 | $166.83 | 4.79% |
| 8 | Walgreens | 29 | $149.40 | 4.20% | 29 | $145.20 | 4.17% |
| 9 | 7-Eleven | 84 | $124.10 | 3.48% | 84 | $118.00 | 3.39% |
| 10 | Sam’s Club | 4 | $113.60 | 3.19% | 4 | $112.90 | 3.24% |
| 11 | Rite Aid | 27 | $92.50 | 2.60% | 27 | $94.20 | 2.70% |
| 12 | Costco | 2 | $65.60 | 1.84% | 2 | $64.50 | 1.85% |
| 13 | BJ’s Wholesale Club | 2 | $63.60 | 1.79% | 2 | $63.00 | 1.81% |
| 14 | International Markets | 6 | $50.90 | 1.43% | 6 | $49.70 | 1.43% |
| 15 | Circle K | 30 | $49.80 | 1.40% | 30 | $49.00 | 1.41% |
| 16 | Fresh Market | 3 | $41.20 | 1.16% | 3 | $40.90 | 1.17% |
| 17 | Fas-Marts | 27 | $34.00 | 0.95% | 27 | $33.30 | 0.96% |
| 18 | Sheetz | 9 | $30.70 | 0.86% | 9 | $29.80 | 0.86% |
| 19 | Whole Foods | 1 | $26.10 | 0.73% | 1 | $25.20 | 0.72% |
| 20 | Save-A-Lot | 4 | $19.10 | 0.54% | 4 | $18.90 | 0.54% |
| 417 | $3,519.78 | 98.84% | 410.00 | $3,415.43 | 98.29% |
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