Sunday, February 16, 2020

What Happens When Your Luck Runs Dry...

Florida Choice #XXX / Gooding's of Winter Park / Winn-Dixie #2383 / Lucky's Market #45
7580 University Boulevard, Winter Park, FL - Uni-Gold Shopping Center

     As you know, it's been a busy few weeks for Floridian supermarket news, and today's post is going to touch on one of the biggest headlines we've had in a while: the departure of Lucky's Market from Florida. Before I begin this post, I'll start with a brief recap on the situation, just to make sure everyone is up to speed:

     In December 2019, Kroger announced it was dissolving its investment in Lucky's Market, a partnership created between the two chains in 2016. While Lucky's had entered Florida on their own in 2015, with a handful of stores in development, things rapidly changed once Kroger got involved with Lucky's. Between 2016 and 2019, Lucky's Market began announcing batches of new Florida locations, dotting all parts of the state. The sudden expansion effort was funded by Kroger's deep pockets as part of the newfound partnership, as well as Kroger's desire to finally make a break into Florida, something Kroger had failed at twice back in the 1980's. By investing in Lucky's Market, Kroger would be able to drop grocery stores all over Florida with ease. Since Lucky's was a specialty grocery chain, Kroger would be able to dominate Florida in this niche, not having to worry about competing directly with the state's supermarket overlord fiercest competitor: Publix. The idea made a lot of sense from a business standpoint - why compete head-to-head with Publix, knowing that would be a huge challenge, when you could sneak in through the back door? Kroger's money eventually grew Lucky's Market into a chain with 21 locations across Florida in 2019, with 14 more Floridian locations to come online by the end of 2020. By the end of 2020, Lucky's Market would have nearly two-thirds of its store base in Florida, and the most widely-spread presence of any organic chain operating in the state at the time. Everything was looking really good for Lucky's to become Florida's #1 organic grocery chain in late 2019. Floridians loved Lucky's, the chain was growing like crazy, and all signs were pointing to Lucky's being in Florida for a long, long time. Kroger's decision to pull their investment from Lucky's Market seemed a bit unsettling when the news first broke in December 2019, but nobody seemed to think much of the announcement at the time. When that news first broke, it was still unknown just how deeply attached Lucky's was to Kroger's money, or how deeply involved Kroger was in Lucky's ownership. It would take another month before the complete picture of the aftershocks of Kroger's move became extremely clear...

     You should have seen the shock on my face when I got home from work on that day in late January 2020, opening the AFB inbox to this short statement from contributor Reviewer Jay: "All but 1 Lucky's Market in Melbourne are closing due to Kroger’s investment pullout." I was in a bit of disbelief for a moment after reading that. The organic chain that was on track to dominate Florida essentially collapsed overnight? What? What's going on here? As it turned out, Lucky's became very reliant on Kroger's money and oversight, too reliant, actually. After the mass closures were announced, it was revealed that Kroger had the majority ownership steak in Lucky's, owning 55% of the company. With Kroger out of the picture, Lucky's didn't have much money left to do anything. Kroger was Lucky's blank check, their investment money used to go from 5 stores in Florida pre-Kroger to nearly 40 by the end of 2020. With the money gone and such a fragile empire built up so fast, everything collapsed. Florida's soon to be domineering organic chain couldn't sustain itself without Kroger, owing $300 million in debt to Kroger from the expansion efforts as revealed in the fallout. In addition to the $300 million debt, Lucky's was also using Kroger's money to offset their losses as they tried to build their Floridian empire. Facing life back on their own once again, Lucky's had no choice but the pull the plug on their empire, shutting down 20 of the 21 Floridian locations at once. In addition to the Floridian closures, 12 of Lucky's 18 stores located outside of Florida were also picked for closure. With Kroger gone, Lucky's was only able to sustain 7 core locations, including the original Lucky's Market in Boulder, CO, as well as stores in Columbia, MO, Traverse City, MI, Fort Collins, CO, Columbus, OH, Cleveland, OH, and Florida's lucky Lucky's in West Melbourne. These 7 locations, after a few days of uncertainty on their future, would be packaged together to be sold to Lucky's Market founders Bo and Trish Sharon. While the West Melbourne location seemed like it was the odd one out of the go-forward bunch, being so isolated from the remaining 6 stores clustered around the Rocky Mountains and the Midwest, the West Melbourne store was a very busy Lucky's. While many of the other Floridian Lucky's stores were also very successful (like the location in Clermont, supposedly a top-tier location alongside West Melbourne), I've been told Kroger's meddling with terms in the store leases is what cost Lucky's the opportunity to save a handful of more stores from closure. After announcing the closure of the 32 stores in late January 2020, Lucky's declared bankruptcy. To make some money to pay off the debts, Lucky's was able to find buyers for some of their closing and unopened Florida locations. These buyers included Aldi (6 stores), Publix (5 stores), Seabra Foods (1 store), and Hitchcock's Markets (1 store). However, an interesting twist to the Lucky's Market saga came when Southeastern Grocers, parent company of Winn-Dixie, agreed to buy 5 additional Lucky's locations throughout Florida. While SEG buying stores from Lucky's was a bit of a shock to begin with, one of the 5 stores SEG bought was the West Melbourne Lucky's store, the lone Florida location that Lucky's was supposed to keep going forward. The sale of the West Melbourne store to SEG would ultimately end Lucky's short 5 year run in Florida, with Lucky's officially leaving Florida on February 21, 2020 with the closure of the West Melbourne location. However, Lucky's really didn't want to give up the West Melbourne store. At the bankruptcy proceedings for some of Lucky's assets, SEG made a surprise bid for the West Melbourne store, offering an exorbitant amount of money for just that one location. Effectively, Bo and Trish were outbid on the West Melbourne store in the end, cutting Lucky's go-forward locations down to six. So why did SEG want the last Florida Lucky's in West Melbourne so bad, you ask? Well, the building the West Melbourne Lucky's was housed in was previously home to a Winn-Dixie, a Winn-Dixie that was kicked out specifically so Lucky's could move into the space. Winn-Dixie did not want to close their West Melbourne store at the time, and hopelessly pleaded with the landlord to renegotiate their soon-to-be-expiring lease. Apparently, Winn-Dixie can hold a grudge, and desperately wanted their old store back. While the saga of the West Melbourne Lucky's is an interesting one, I'm going to leave all the details of that story to my posting series of the store over on My Florida Retail.

     While the story of the West Melbourne Lucky's is very much one of retail coming full circle, the Lucky's Market we'll be touring today is also an example of retail coming full circle (in a way). We've actually been to this very building once before on AFB, back in October 2017. If the picture above isn't jogging your memory, this next one should:

     That looks a little more familiar, doesn't it? It's the old Winter Park Florida Choice store! When Lucky's and Ross moved into the place, they ripped out just about everything that was so well preserved about this building from the Florida Choice days. For a recap on this place prior to Lucky's arrival, you can check out my post here (a very interesting post on Florida Choice, by the way, if you've never seen it before or are unfamiliar with Florida Choice).

     As you probably know, Florida Choice was one of Kroger's short-lived attempts at expanding in Florida during the 1980's. Kroger gave up on Florida Choice in 1988 after only two years, expanding the brand to 43 stores across the state (primarily through the acquisition of the Florida Family Mart stores in 1987). When Kroger ended Florida Choice suddenly in 1988, many stores had only been open for a few months (like the Winter Park store, which only lasted 5 months as a Florida Choice). Some Florida Choice stores, like the locations in Rockledge and Apopka, were only months shy of opening before Kroger pulled out of Florida (notice the parallels to Lucky's here?). The Winter Park Florida Choice store was one of the locations picked up by Gooding's in 1988, which Gooding's then sold to Winn-Dixie in 2000. Winn-Dixie closed this store (willingly, I should clarify) in September 2016, a quiet closure due to under-performance. Since Winn-Dixie actually wanted to get rid of this store, it was not one of the 5 locations they acquired from Lucky's in February 2020 (however, Winn-Dixie did buy an unfinished Lucky's in nearby Lake Mary). As of the publishing of this post, there is no clear future as to what will happen to the former Winter Park Lucky's Market store.

     The Winter Park Lucky's Market was a fairly standard Lucky's store in design and layout. Even prior to the Kroger-era, Lucky's used the layout we'll be seeing today for most stores (with minor exceptions). The day I visited the closing of the Winter Park Lucky's, I visited two other Orlando-area stores that were also closing. These stores were only two days into the closure process at the time of my visit, although they were all beginning to look fairly wiped-out, this store especially. The closing sales began with a flat 25% off discount on all merchandise, which eventually raised to a flat 50% and 75% off discount as the sale went on. 

     Lucky's Winter Park store opened on October 10, 2018, filling the Winn-Dixie that had been empty for two years at that point. The Ross Dress for Less store next door opened earlier in 2018, taking over the portion of the building that contained most of Florida Choice's fresh departments. The projected final day for the Winter Park Lucky's was February 12, 2020, although the final day came a bit early on February 7th due to depletion of stock. In the above photo we're looking toward the front doors from the produce department, which was located in the front right corner of the building.

     The fresh-squeezed juice bar was located in the very corner by the front doors, and was mostly empty during my visit.

     While the juice bar may have been empty, one thing this place was not empty of were shoppers! People had flooded out to stock up on bargains throughout the store, as you can see by the long lines forming at the registers here. The first day of West Melbourne's closure was even nuttier than this, with lines backed up far into the grocery aisles!

     However, if the Lucky's liquidations weren't enough for the organic-focused bargain hunters out there, shortly after's Lucky's woes were brought into the public eye, organic rival Earth Fare also announced its sudden (and unexpected) total liquidation. While lacking Lucky's famous "Sip and Stroll" feature, Earth Fare was essentially the same concept as Lucky's: a laid back, fun place to shop for organics without the stuffy atmosphere. Like Lucky's, Earth Fare was also pushing hard into Florida, having a total of 14 stores in the state and more in development at the time of the liquidation announcement. While Earth Fare wasn't going for widespread market coverage and domination like Lucky's was in Florida, they were still trying to build up a respectable presence here. I covered the opening of the Earth Fare store in Rockledge here if you wanted a quick overview of what Earth Fare was like. Essentially, Florida got hit hard with supermarket closings these last few weeks, with both Lucky's and Earth Fare leaving us so suddenly. While the loss of jobs is terrible, Lucky's stores (as well as Earth Fare's) were occupying many long-empty retail spaces. Considering how slim the choices for supermarkets have become in Florida of late, these new grocery stores opening up was a nice change of pace. What's even worse is much of Lucky's and Earth Fare's store base was so new, with some stores not even making it a full year. It's really a shame all around.

     Food Glorious Food - Lucky's famous statement placed in big letters over the produce department. Surrounding the "Food Glorious Food" sign were some smaller signs, advertising Lucky's commitment to sourcing local products. In the pre-Kroger days, every Lucky's store had a specially curated selection of products, with each store running its own sale ad and curating its own unique selection of local products. It was a decent strategy for running such a widespread store base at the time. When Kroger came into the picture (and Lucky's began to open more stores), a lot of Lucky's distribution become more centralized, with groups of stores running off the same ad and carrying the same products. Lucky's even opened a new distribution center in Orlando to supply the chain's growing fleet of Florida locations in late 2019, mere months before the bottom fell out. As part of the fallout, the Orlando distribution center was cut at the same time Lucky's shed 32 of its 39 locations across the country.

     As for answering the big question of what went wrong with Lucky's - here's what I'm getting from reading various news sources: Certainly, Kroger pulling out its investment was the big blow that made this mess possible. Without the investment, Lucky's wasn't able to support 39 stores, with 15 more on the way nationally. According to news articles, Lucky's was projected to lose $30 million at the end of fiscal year 2020. Lucky's reliance on borrowing money from Kroger, along with the losses, was probably the reason Kroger cut ties with Lucky's. I'm sure Kroger was growing tired of Lucky's sucking off so many of their resources without turning a profit. However, while those numbers may look bad, I believe Lucky's was operating at a loss due to an over-emphasis on the Floridian expansion efforts (not necessarily because their concept was bad). It takes a lot of money to go from 17 stores nationally (when Kroger first bought into Lucky's) to over 40 in a span of three years. Lucky's was probably justifying these losses to Kroger as an expense for a bigger profit later, once the company's Floridian store base was large enough to where Lucky's could focus more on operations rather than a full-on expansion push. Kroger, I'm sure, wanted profits now and not later, and decided to dump Lucky's before throwing any more money into the hole.

     Even though dumping Lucky's would be Kroger's third failed attempt at establishing some sort of presence in Florida (behind SupeRx Food and Drug and Florida Choice), Kroger is still going ahead with opening a new automated customer fulfillment center in Groveland, located northwest of Orlando in Lake County. This fulfillment center is completely unrelated from anything involving Lucky's, and is a separate Kroger venture. The new fulfillment center is a partnership between Kroger and Ocado, a British online grocery business, and will fulfill online grocery orders placed throughout Florida. How successful this venture will be in Florida remains to be seen, considering how Kroger isn't a well-known brand here (and what notoriety Kroger has been getting recently in Florida has been as "the Lucky's murderer" - which I wouldn't call good PR). However, it seems like Kroger is using every backdoor technique to get into Florida - first by investing in a specialty organic chain, then through online grocery fulfillment. It seems like Kroger really wants to be in Florida, but just can't figure out the best way to do so.

     Anyway, back to Lucky's, the few employees I spoke to this day were quite angry at Kroger, blaming them for this entire mess. Even at my local Lucky's, the sentiment toward Kroger was the same from employees. I can't blame them for being angry at Kroger either, as I'd probably feel the same way if my job was essentially yanked out from under me due to a sudden decision like this. Had Kroger not made their investment in Lucky's, Lucky's probably would have continued to expand in Florida, a small but stable entity in the organic grocery space. Lucky's themselves could be blamed for this mess too, getting a bit overzealous with Kroger's money and encouragement to become the #1 organic grocery chain in Florida. However, it was the perfect trap for such a young company like Lucky's to fall into: getting an investment from a large powerhouse, promises of glory, going overboard with the newfound power and freedoms, just to abuse it and have it all yanked out from under them in the end. Anyway, I'm not trying to blame one party or the other here. Both Kroger and Lucky's contributed to this mess in some way, and this was how it all came to an end. It's sad, yes, but it became the reality.

     Even though I talked over the last few photos with analytical business stuff, in those photos we saw the main aisle that separated the grocery aisles from the bulk foods department, as well as bulk foods itself. Returning to the perimeter, Lucky's frozen foods department is located along the building's right side wall, pictured above.

     Looking in the opposite direction of the previous photo, here's a much sharper picture of the frozen foods department, showcasing the entirety of the department sign (and minus the fuzz from my hand shaking).

     Rounding the corner to the back wall, we find the dairy coolers. The meat coolers were straight ahead, located where the wall angles out in the distance.

     Here's a better photo of the dairy sign itself, as well as the thinning selection of merchandise in the cooler below.

     While there was still a little bit to pick and choose from in the dairy coolers two days into the closure, the meat coolers were practically empty during my visit.

     There grocery aisles were quite picked over too, as you can see here.

     This particular Lucky's had a designated Kosher section (seen here), something my local Lucky's didn't have (all part of Lucky's local commitment). Unlike the previous aisle I photographed, this one still had a bit of merchandise left in it.

     After the 6 grocery aisles, we enter the store's fresh departments. Like most organic grocery chains, a lot of emphasis is placed on the fresh and prepared foods (which take up a good chunk of the floor space). That was no exception here, as the fresh departments (including produce) took up about half the floor space in this store.

     Beer and wine was located in the last grocery aisle before the fresh departments. While most organic stores are content with selling beer and wine only (as to not bother with Florida's liquor wall law), Lucky's actually opened an attached liquor store at their Gainesville location. I thought that was a bit unusual to see, although Publix is opening attached liquor stores at some of their new Greenwise locations as well.

     After passing through the wine and beer aisle, we find the meat and seafood counter. As you can see, the counter was completely shut down, seeming to suggest Lucky's depleted what stock of meat they had left only two days into the sale. The meat and seafood counter is located behind the gourmet ramen bar. I forgot to photograph the ramen bar at this store, but it looked like this.

     The largest department on this side of the store was "The Kitchen", which is Lucky's deli and prepared foods counter. This is where you could find Lucky's famous pizza, which was still being served two days into the closure. That pizza is what I'm going to miss the most about Lucky's - it was good stuff!

     In front of The Kitchen we find the food bars. The olive bar is the one taking up the majority of this picture, with the salad and hot food bars located behind me.

     From the fresh departments, here's a random photo looking across the width of the store. At 25,000 to 30,000 square feet, Lucky's stores were small, but certainly didn't feel that way with the wide aisles.

     The last department we've yet to see in this tour is Lucky's health and beauty section, which they called the "apothecary". The apothecary was tucked between Lucky's bakery (located at the far end of The Kitchen) and the cafe. Speaking of the cafe, that's where we'll be headed next...

     Lucky's cafe was located in the front left corner of the store, where Florida Choice's pharmacy used to be. Lucky's cafe sold the usual coffees and teas, but also acted as a bar. This is where you could buy your wine or drought beer to sip as you strolled throughout the store, or enjoyed your beverage relaxing at one of the tables. Sip and Stroll was a large part of Lucky's appeal, and one of the biggest things they pushed to make themselves different from other organic chains. At least in Florida, Lucky's was the first place where I'd seen sip and stroll, although Publix's new Greenwise stores copied the concept when those made their debut in 2018.

     While the cafe at my local Lucky's was always a hopping hangout spot, the cafe at the Winter Park Lucky's was mostly empty during my visit.

     Within the cafe was this neat table, custom designed not only for Lucky's, but this location specifically. This was certainly a neat touch, and a fun way for Lucky's to create local flare within the store (as being "local" was a large portion of what Lucky's was all about).

      Since this store was my last stop of the day, it was snack time. While I had my snack, I noticed this sign set atop my table. While it looks like a long chunk of text (like this post), I highly recommend you click on the picture and zoom in to read the whole thing - it's actually quite funny! "You deserve a pat on the back for reading this entire list," says the sign in the very last sentence. I'm sure you guys are thinking the same thing about this post, but don't fret - we almost done!

     Like most closings, there was a brisk crowd out, looking to fill their carts with as many bargains as possible. You can see the long lines at the registers here, with shoppers stocking up on their favorites from Lucky's before they were all gone. You can also see Lucky's soda bottle lane lights in this image as well, one of the most creative designs for those I've ever seen.

     Unfortunately, National Chocolate Cake Day would be a bittersweet celebration here (unlike the semisweet occasion it usually is), as that celebration fell in the midst of this store's closure. This is a quick peek at the large chalkboard calendar located at the front of the store, a photo I randomly took as I left.

     Back on the front walkway, here's a look from Lucky's exit toward Ross Dress for Less. Unlike the last time we were here, the front walkway of this building wasn't quite as fun to explore this time around.

     On my way out, I wandered over toward the Ross side of the building. I didn't go in, as nothing would have been left behind inside from Florida Choice, but I did take this photo of the entryway for whatever reason.

     As of February 21, 2020, Lucky's Market in Florida is no more. With a 5 year run, Lucky's had a short stay in the Sunshine State, but it certainly wasn't the shortest stay we've seen. Unlike other recent Floridian supermarket casualties (namely Safeway Florida), Lucky's had a more widespread reach across the state, and certainly a much stronger following. With more stores and a larger following, the burst of Lucky's bubble sent a much stronger shock wave across the state. This certainly wasn't the way I was expecting 2020 would begin, but it will certainly change the Floridian grocery landscape as we go forward in the new decade. For the time though, Publix is still king, Walmart is number 2, and Winn-Dixie is, well, there. In the organic ring, there's the old stalwarts Whole Foods, Trader Joe's, and The Fresh Market, the former two concentrated more in the urban areas of Florida. Publix's new Greenwise Market and Sprout's are still growing as well, even with the sudden demise of those chain's two closest competitors. With Lucky's and Earth Fare leaving us, Publix has already taken advantage of the news, and Sprout's will probably do the same, infilling the  voids left behind. We've seen Sprout's on the blog before, and we'll be checking out the new (as well as the original) Publix Greenwise before too long. Publix Greenwise is essentially a Publixified knock-off of Lucky's though, showing how even Publix found merit in Lucky's operating model. However, where Lucky's fails, Publix will probably succeed, as that's just how things always work down here in Florida. However, unlike Earth Fare, Lucky's will still exist in some form going forward. Once the dust settles, and if Bo and Trish Sharon can re-stabilize Lucky's finances, there still exists a chance Lucky's could make a grand return to Florida. Remember, Bo and Trish did not want to give up the West Melbourne store, and Lucky's is no stranger to having an odd geographic presence. It probably sounds crazy right now, and might be a completely unlikely thought, but you can't say it's impossible that Lucky's could make a Floridian return if the company can get out of this rut. Florida is a crazy place for retail, especially supermarkets, so who ever knows what will happen here next...

     Anyway, this post was long and rambly enough, so I'll end it there. Lucky's was an interesting contribution to the Floridian grocery scene, ending in a sudden, tragic way like so many others who have tried to make it big here in the past. As far as scheduling is concerned, I've got one more bonus store coming up to end the month on. After that, we'll jump into some back-to-back Albertsons (to make up for me pulling this month's Albertsons post in order to cover Lucky's demise in a timely manner).

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

The Albertsons Florida Blogger


  1. It is not a good time for specialty organic/gourmet grocers indeed with Lucky's Market and Earth Fare failing.

    What is the future of Lucky's Market's locations? Publix Super Markets, Aldi, and Southeastern Grocers are mentioned in several reports in acquiring stores. Aldi, a limited assortment/discount grocer, would be a significant change. Publix Super Markets would have additional locations to expand its specialty organic/gourmet banner GreenWise Market. Southeastern Grocers may open additional Winn-Dixie supermarkets. Its future remains uncertain as more stores across the BI-LO, Fresco y Más, Harvey's Supermarket, and Winn-Dixie banners may close.

  2. While this story is crazy enough to tell itself, as always you do a great job of summarizing the situation, sad as it may be. Great post. Looking forward to more coverage, and hopefully, some good news to result for the newly vacant buildings, especially those that were only open a short time and/or opened in buildings that had been vacant for a long time beforehand. And finally... you really got me with that chocolate chip joke XD

  3. Definitely sad to see yet another grocery chain in your area imploding. Your comment about Earth Fare and Lucky closing at the same time reminded me that my area saw one of our local organic grocery stores, New Seasons, die off recently -- from what I've seen on here, it looks like Lucky's was a very similar place to New Seasons. It's really starting to feel like the semi-fancy organic grocery concept was a bubble that's starting to burst, unfortunately.

    And of course we can't forget Main & Vine, Kroger's first attempt at entering the specialty/organic grocery market, which also failed a while back... This all makes me think that maybe Kroger should stay out of that part of the grocery business! That online shopping thing sounds interesting though...

  4. The original Florida Choice building that Lucky's and Ross opened in here is the very building I used for my recreation of #4382 in Stuart. I would sure like to have seen that Albertsons when it was open 25 years ago. I think the recessed entryway to those Florida Choice stores looked nice. Knowing now that Kroger had a 55% stake in Lucky's makes all the more sense now, in that they folded so quickly after the Kroger divesture.