Last updated on January 15th, 2019
by Treva Bennett/staff writer
As Georgia’s economy has improved over the past few years, competition in the grocery industry has grown.
Kathy Kuzava, president of the Georgia Food Industry Association (GFIA), said for the fifth year in a row Georgia has been named “No. 1 State for Business” by Site Selection, a leading economic development publication.
“As long as our state’s population continues to grow, retailers will continue to expand in our great state,” she said.
Georgia’s economy ranked as the ninth best among the states in 2018, according to Washington, D.C.-based WalletHub.
According to a June 2018 article in The Atlanta Journal-Constitution, job growth alone casts Georgia in a generally positive light. The population and workforce have grown solidly, job creation has been steady, and many of the new jobs are good-paying corporate positions.
During the past year, Georgia’s economy has added 67,100 jobs, representing a growth rate of 1.5 percent.
Georgia’s unemployment rate currently is 4.3 percent, down from 4.9 percent a year ago and 10.6 percent in 2011.
A July 2018 article in Bisnow Atlanta addressed the state of the grocery industry in the metro Atlanta area. As competition continues between grocers in the Atlanta market, the region’s growth is expected to accommodate new store growth, Bisnow Atlanta reported.
Kuzava said that although Georgia is known to be overstored, especially in the metro Atlanta market, “companies continue to build stores here. This market is already extremely competitive and is becoming even more so with the new Lidl stores opening soon in Cobb County. Metro Atlanta is a tough market choice for grocers to succeed on razor-thin margins but terrific for customer choice.”
While The Fresh Market and Earth Fare have closed some stores in the extremely competitive market, others are finding ways to succeed. Niche players are looking to lure customers from grocers that dominate the market, such as Kroger, Publix and Walmart, according to Bisnow Atlanta. But competition from smaller chains has not prevented the larger stores from growing.
New stores, remodels
In September 2018, Publix announced Marietta as the fifth locale for its new-format GreenWise Market. GreenWise is a specialty, natural and organic store featuring a variety of house-prepared meals, grab-and-go items and unique products. The Marietta location is slated to open in 2020, according to a statement from Publix.
A new Publix store also is scheduled to open on Memorial Drive in Atlanta May 22, and a new store is planned for Hamilton Mill Road/Bogan Road in Buford. An opening date has yet to be determined for the Buford store.
According to its website, Publix currently has 189 stores in Georgia.
Whole Foods Market planned to open its first two “365” stores in the Atlanta area in the Decatur and Buckhead areas on Dec. 12, 2018. The 365 store is a smaller-concept store that focuses on the company’s lower cost 365 Everyday Value brand. According to its website, the two new stores will bring the total number of 365 stores in the U.S. to 12.
Whole Foods also announced in November it plans to relocate its Southeast regional office from Roswell to Midtown Atlanta’s Colony Square.
Nearly a year after reports that it was scaling back its plans to expand its footprint in Georgia, European grocery chain Lidl is building two new locations in Cobb County. According to its website, its only other Georgia location is in Augusta. No grand opening dates have been set for the Cobb County stores, according to a statement from Lidl.
“We have received positive feedback from our customers in Georgia and look forward to introducing Lidl’s award-winning products and low prices to more communities and customers in the state,” the company said in an email to The Shelby Report.
Aldi reopened its Douglasville and Snellville stores in November 2018, which were part of a $1.9 billion initiative to remodel and expand more than 1,300 Aldi stores nationwide by the end of 2020. Aldi is investing $42 million to update 34 stores in Atlanta and the surrounding metropolitan area by the end of 2019.
Expanding its product selection is the next phase of the company’s aggressive national growth and remodel plan. Its fresh food selection is growing by 40 percent with the addition of many organic, convenient and easy-to-prepare options. The stores also feature open ceilings, natural lighting and environmentally friendly building materials.
“Remodeling and expanding our stores gives us more room for our refreshed product selection,” said Shaun O’Keefe, Jefferson Division VP. “We know our customers want more fresh and convenient options, and by renovating our stores we are able to provide new products as well as more of their favorites.”
While it’s not a new grocery store, Kroger’s Atlanta Division announced in November 2018 a New Markets Tax Credit (NMTC) allocation to support the construction of a 345,000-s.f. food warehouse and distribution center for the Atlanta Community Food Bank (ACFB).
The company stated in a press release that the $15 million NMTC allocation aligns with its national Zero Hunger/Zero Waste initiative. Through the social impact plan, Kroger has set a vision to end hunger in the places it calls home and to eliminate waste—especially food waste—in the company by 2025.
Tim Brown, president of Kroger’s Atlanta Division, said the company is committed to “living our purpose to change the world.”
Brown took office Aug. 1, 2018, following the retirement of Bruce Lucia, who retired after 44 years of service to Kroger. The Atlanta division, with 183 stores, comprises stores in Georgia, eastern Alabama and South Carolina.
While independent grocers have challenges in competing with large chains, they also have certain advantages, Kuzava said.
“An independent retailer is many times closer to their customers than a large chain store and can make decisions and react to their customers quickly,” she said.
Independent grocer Wayfield Foods, based in Atlanta, opened a new-format store in Fayetteville in late July 2018 called Eden Fresh Market, offering a broader selection of fresh foods than its traditional stores.
Wayfield Foods President and CEO Ron Edenfield told The Shelby Report in August the new store is designed to have wide appeal but especially to younger customers, who are looking for products like wild-caught seafood, grassfed beef, gluten-free products, and natural and organic options. The store offers meal kits from Freshop (which also handles the store’s click-and-collect program) as well as local products such as The King’s Donuts from a Fairburn donut shop.
Convenience is key
According to Quartz, retail sales at U.S. eating and drinking establishments have outrun those of grocery stores for the last year, disrupting a longstanding pattern in which the bulk of American spending on food occurred at the supermarket.
Grocers have addressed this trend in a number of ways, one of which is offering meal kits to shoppers looking to save time at home on preparing meals.
Kuzava said retailers are responding to their customers’ demands for more convenience, “whether that be through more prepared foods, meal kits, additional curbside pickup or having groceries delivered. Also, the demand for local products continues to be strong as customers enjoy supporting the local economy.”
Legislative issues include WIC
When the Georgia General Assembly convenes Jan. 14, there will be many new faces in state government, including a new governor. Kuzava said GFIA is “excited” about Gov.-elect Brian Kemp and his pledge to “‘take a chainsaw to burdensome regulations.’ There are certainly some areas with the Georgia WIC Program that could use some major work,” she said.
With several new legislators set to take office in January, Kuzava said she will try to help foster relationships with independent retailers.
“GFIA’s independent retailers are also our ‘secret weapon’ when it comes to grassroots relationships with elected officials,” she said. “When a legislator is first elected, I always try to match them with an independent retailer. These relationships are beneficial to every GFIA member, both independents and chains, which is why our members work so well together.”
GFIA will be keeping an eye on several issues in the 2019 legislative session. Kuzava listed some of the issues of interest to the association:
• Modernizing antiquated alcohol laws, whether it is parity with restaurants on hours of sale or reducing onerous fines for penalties when a violation occurs in curbside pickup transactions.
• Debating whether to expand Medicare. Many believe Georgia should remove the exemptions from the state sales tax on food to fund Medicare, so GFIA will watch this carefully.
• Looking to find an answer on fake service dogs, which are becoming a bigger problem for Georgia’s grocers.
• Preventing business owners from being fined by local officials if customers steal a retailer’s property. Kuzava said last year Savannah officials became frustrated with finding shopping carts that had been stolen and abandoned. They decided the best way to prevent this was to fine the retailers who were already victims of stolen property. “Retailers couldn’t pick up the carts fast enough because this was a constant problem in some areas,” she said.
• Working on civil justice reform with Georgians for Lawsuit Reform. GFIA is telling the stories of its smaller retailers, giving examples of how current law hurts all of its members but most especially the smallest retailers.
