Kroger (NYSE:KR) announced it would invest $100 million in its Michigan stores to grow its share of the local grocery market.
Including expansions at several store sites and renovations at 10 locations, Kroger is also looking to add 62 new fuel centers to its already existing 124 in Detroit, Ann Arbor, Flint and Lansing, reported Crain's Detroit Business.
The company will continue to invest at least $100 million in the state each of the next two years.
"The Michigan market is very, very important to Kroger Co.," said Jayne Homco, president of Kroger's Novi-based division.
According to analyst Ken Perkins, the Michigan division of the company accounted for about 5 percent of Kroger's total $77 billion revenue in 2013.
Kroger is up against a number of regional, independent grocers in Michigan including Hiller's Market, VG's Groceries and Hollywood Markets. Competition also includes big chains like Meijer and Walmart.
Expansion is one of Kroger's strategies, including building the state's first 123,000 sq. ft. Kroger Marketplace with departments that include housewares and apparel.
Another strategy beyond super-sizing is offering customers fresh, organic foods. Thus far, the tactic seems to be working. Kroger's exclusive brand of organic products has reached $1 billion in annual sales. The Simple Truth natural and organic foods line, which launched two years ago, has seen consistent sales growth amidst increasing consumer demand.
The company is on an upward trend. It recently reported the 43rd consecutive quarter of same-store supermarket sales growth.
-See this Crain's Detroit Business article
Kroger earnings rise on consumer confidence bump
Kroger creates '21st Century' digitized store
Kroger to add an additional market, focus on urban-format stores
Instacart gets $44M to fuel expansion
Kroger names Tim Massa group vice president of human resources and labor relations