Mid-Atlantic retailers generally continued to produce record sales as inflation created strong economic tailwinds which have only slightly abated in the past three months. In fact, beginning in 2020 with the impact of the pandemic and then continuing in 2021 with a combination of the remaining sales effects of COVID-19 and the beginning of rampant food inflation, many retailers had predicted the period from April 1, 2022 to March 2023 would see a slowing of economic growth. And while there were many other non-grocery industries that experienced flat or slightly negative sales, retail food was not one of them.
For the entire year, we estimated that overall retail prices increased about 11 percent, and although the challenging supply chain disruption of 2020 and 2021 improved, manufacturers continued to increase their wholesale pricing in a move that several retailers termed exorbitant. In fact, total retail sales in the 89-county Mid-Atlantic market increased from $57.1 billion to $60.6 billion over the 12-month measuring period, the second highest growth rate since Food World has published its annual sales and share of market breakouts (only 2020’s inflation rate was higher).
[Read the complete 2023 Food World Market Study issue, with full data.]
Here’s a breakdown of the top 10 retailers in the Mid-Atlantic market.
Giant Food, the market leader since Food World’s first retail market study was published in 1979, remained atop the leaderboard, amassing sales of $6.38 billion at its 161 stores, one more than last year. The Landover, MD brand of Ahold Delhaize USA (ADUSA) continued to dominate in its core Baltimore-Washington market and also invested heavily over the past 12 months in its digital platform as it prioritizes its focus on omnichannel retailing. Earlier this year, Giant Food opened a second large digital fulfillment center in Manassas, VA.
Continuing to make gains in comp store sales was Walmart. The planet’s largest retailer (and grocery merchant) remained in second place among all operators in the $60.6 billion market by once again not opening any new stores (in fact, it closed a store in Washington, DC) as it continued to focus on its growing digital business. Extrapolated food and drug sales at its 160 stores increased to an estimated $6.06 billion and the Bentonville, AR merchant significantly benefited from gains in customer counts, transaction size and overall inflation.
CVS, the largest drug chain in the region, retained its third-place ranking in the market. The Woonsocket, RI-based drug merchant was also the only drug chain (of the “big three”) to not close a significant number of the stores during the past year. CVS now operates 631 drug stores in the region (seven fewer than last year), which amassed an estimated an estimated $3.77 billion in annual sales.
Remaining in fourth place among all Mid-Atlantic merchants was Food Lion, which continued to be the best performing brand in the ADUSA portfolio. The Salisbury, NC-based grocery chain now operates 256 stores (one more than last year) in the 89-county region and compiled estimated annual revenue of $3.46 billion.
Albertsons Mid-Atlantic, which includes the Safeway, Acme, Kings and Balducci’s banners, maintained the momentum that was created when the division was formed in 2020. The regional arm of the large Boise, ID-based chain continued to operate 124 stores and rang up estimated annual sales of $3.36 billion. In October 2022, Albertsons and Kroger announced they have agreed to merge, although approval or rejection of the nearly $25 billion deal is still about a year away.
The Giant Company (TGC), the ADUSA brand based in Carlisle, PA, remained sixth-ranked among all grocery retailers in the Mid-Atlantic region. Sales at its 63 Giant and Martin’s stores (same as last year) in Pennsylvania, Maryland and Virginia rose to an estimated $3.01 billion.
Continuing to upgrade its stores and moving up one spot this year was convenience store leader 7-Eleven, which maintained its improved performance level over the past 12 months. Operating both corporately-owned and franchised c-stores, the Dallas, TX-based operator, which is owned by Japanese juggernaut Seven & i Holdings, now operates 1,122 stores in the Mid-Atlantic which produced an estimated $2.62 billion in annual sales.
Harris Teeter is now in eighth place in the Mid-Atlantic region. The Matthews, NC-based Kroger subsidiary rang up estimated sales of $2.53 billion at its 78 area stores. Industry veteran Tammy DeBoer now has a full year under her belt (she replaced the now-retired Rod Antolock as president of the regional chain in 2022).
Moving from 11th to ninth among Mid-Atlantic retailers was Wegmans which opened three high volume stores during the market study measuring period – Alexandria, VA; Washington, DC; and Reston, VA. Sales spiraled from an estimated $2.00 billion last year to an estimated $2.37 billion for its current 26 stores in the region.
Rounding out the area’s top 10 was Target. The Minneapolis-based mass merchant now operates 114 area units (three more than last year), The company also runs nearly a dozen smaller urban models as well as three SuperTarget locations. Target also benefited handsomely from food price inflation. During the past 12 months, estimated extrapolated sales grew from $2.05 billion last year to $2.22 billion this year.
Other retailers that topped the $1 billion mark in annual sales in the 89-county region included: the 137 “International Markets” (specialty and ethnic supermarkets that are at least 20,000 square feet in size are grouped together in this survey). Collectively, those stores rang up estimated annual sales of $2.04 billion; Costco – 30 stores, estimated extrapolated annual sales of $2.03 billion (one of the best performers in the region); Weis Markets with 96 stores and annual revenue of $1.98 billion; Walgreens – 317 stores and $1.90 billion in estimated annual sales; Whole Foods, with 34 natural and organic stores and now eight Amazon Fresh units that together amassed an estimated annual revenue of $1.47 billion (in February 2023, parent company Amazon said it would “pause” all future store openings of its Amazon Fresh banner); regional convenience store power Wawa (another stellar performer this year), whose 185 c-stores (eight more than last year) rang up annual sales of $1.39 billion; Kroger, which operated 37 conventional stores and Marketplace stores in the Mid-Atlantic and garnered estimated annual sales of $1.37 billion; Aldi with 144 stores (seven more than last year) and estimated annual revenue of $1.26 billion; fast-growing BJ’s Wholesale Club – 30 stores (one more than last year) with estimated extrapolated annual sales of $1.18 billion; and Sam’s Club (a unit of Walmart), which operates 26 club units in the Mid-Atlantic region, which amassed an extrapolated annual volume estimate of $1.17 billion.
By class of trade, the leaders are: supermarkets – Giant Food (Landover) with 161 stores, $6.38 billion in sales; clubs – Costco with 30 stores, $2.03 billion in extrapolated sales; mass -Walmart with 160 stores, $6.06 billion in extrapolated sales; drug – CVS with 631 stores and $3.77 billion in estimated sales; and convenience stores – 7-Eleven with 1,122 stores and an estimated $2.62 billion in revenue.
Additionally, the 20 military commissaries in the region rang up annual sales of $535.9 million, the first gain at the government-subsidized stores in five years.
Viewed as a group, the 48 corporate chains in the market operated 5,176 stores and accrued an estimated $59.4 billion in annual sales, good for 98.04 percent of the Mid-Atlantic region’s $60.6 billion food and drug market.
Among all independent retailers (those operating between two and 17 stores), Mechanicsburg, PA-based Karns Prime & Fancy Foods led all merchants with annual sales of $188 million at its 10 Central PA stores. Baltimore-based B. Green, which operates stores under the Green Valley and Food Depot banners, ranked second among all indies with seven stores and $167.8 million in annual volume. Also surpassing the $100 million sales mark was Family Owned Markets, the Millersville, PA retail marketing group that handles eight independent stores in Central PA and northern MD that had annual sales of $146.1 million.
As a combined group, the 10 multi-store independent retail organizations in the Mid-Atlantic operated 54 supermarkets which garnered estimated annual sales of $831.7 million. Collectively, those stores controlled 1.37 percent of the region’s food and drug revenue. Dropping out of the survey this year was McKay’s Food & Drug, which closed its last four southern MD stores in 2022.
Major news stories over the past year included the proposed Kroger-Albertsons merger; the first unionization at an Amazon fulfillment center (in Staten Island); the resignation of Nicholas Bertram as president of The Giant Company (to be replaced on an interim basis by veteran TGC executive John Ruane); the appointment of Leon Bergmann as CEO of troubled discounter Save A Lot; the halting of future Amazon Fresh stores (more than 30 locations are still under lease); the housecleaning of senior management at Chesapeake, VA-based Dollar Tree Stores; the transfer of Albertsons Mid-Atlantic president (and company EVP) Jim Perkins to corporate headquarters in Boise, ID to run potential merger spinoff, SpinCo (Tom Lofland was named president); and the naming of Cub Foods/UNFI executive Mike Stigers as Wakefern’s president who this month replaced Joe Sheridan, who was with the largest wholesale food-coop in the country for 48-years, the last 12 as the Keasbey, NJ firm’s day-to-day leader.