Wednesday, April 6, 2016

Kroger Makes an Investment in Lucky's Market

Still Nothing...
This former Winn-Dixie store in West Melbourne, FL is expected to become home to a new Lucky's Market in late 2016.
     A few days ago, Kroger announced their plans to make a "significant financial investment" into the relatively new Lucky's Market chain. For those of you unfamiliar with Lucky's Market, they are a "discount" organic grocer with a look and feel similar to Sprout's Farmers Market. They were founded in 2003 in Boulder, Colorado, although they didn't begin expanding outside of their original location until 2013. Lucky's currently has 17 stores in operation in 13 states with many more new stores in development, including a large push into Florida. Currently, Lucky's has three Florida stores open, located in Gainesville, Naples, and Coral Springs, with locations planned to open in Orlando, Plantation, Neptune Beach, Tallahassee, and West Melbourne by 2017. Lucky's entered this partnership with Kroger as a way to expedite their expansion plans across the US while benefiting from Kroger's experience in offering discount organic product lines and their distribution systems. On the other hand, by purchasing a stake in Lucky's, Kroger now has their first piece of the organic grocery retail space. As you may know, Kroger recently expressed interest in purchasing The Fresh Market before being outbid by a private equity firm. Lucky's Market is probably the better fit for Kroger, as Lucky's tries to appeal to the more budget oriented organic shopper, similar to the clientele that Kroger is trying to appeal to with their Simple Truth organic product line in their own stores. It wasn't publicly revealed how large of a stake Kroger took in Lucky's, but I can't imagine being too small. From what I've read, Lucky's will continue to operate as they are, just now with some backing from the largest grocery chain in the United States. I also feel that this partnership was done as a way for Lucky's, one of the newer organic chains out there, to gain some traction to better compete with the more established organic grocers, like Sprout's and The Fresh Market. This deal doesn't officially bring Kroger into Florida (outside of that lone Harris Teeter in Fernandina Beach) since Kroger didn't completely buy out Lucky's, but I wonder if Lucky's does become a large, successful organic grocer, if Kroger will try to buy out the rest of Lucky's ownership to make them an official Kroger brand. If you'd like to read more about this deal, this article and this article from PR Newswire and The Produce News respectively have more information about it.

So that's all I have for now. Until the next time,

The Albertsons Florida Blogger


  1. Outside of the Harris Teeter in Fernandina Beach, it is doubtful that Kroger would want to expand much in Florida. If Kroger does in fact buy all of Lucky's, it could become a vehicle for them to promote their Simple Truth and Simple Truth Organic lines.

    1. The organic space seems like a market Kroger is very much interested in. This investment in Lucky's is probably a test for Kroger to see how they feel about entering the organic retail grocery space outside of the Simple Truth product line. Lucky's would be a perfect fit for Kroger to acquire once they establish themselves, as long as their current ownership doesn't make any major mistakes or stumbles (as I don't think Kroger has majority say at this point). Maybe Lucky's will be Kroger's way into Florida in the end.

    2. Kroger opened a concept store near Seattle called Main & Vine that serves a similar purpose. If a complete buyout of Lucky's did occur,then I could definitely see Kroger supplementing Main & Vine with Lucky's, and incorporating attributes of both concepts across the company.

      With that being said, while. Lucky's could technically get Kroger into some new areas of Florida, I still don't think Kroger would expand much in that state, especially when the distribution center is still all the way near Atlanta.