Kroger thriving, expanding in center of store

While many grocers have been struggling to compete when it comes to fresh products in the center of the store, Kroger (NYSE:KR) continues to grow this category.

"We are probably one of the few outlets that continues to grow units in the center of the store, and… with as big a piece of business as that is for us or any more traditional or conventional retailer, it's important that those categories grow nicely," Mike Schlotman, senior VP and CFO of Kroger told Food Business News. During a presentation at the Jeffries Consumer Conference in Nantucket, Massachusetts, Schlotman referred to the center store as critical in pushing the top line.

About half of Kroger's volume is grocery items, and produce is 10 percent. Therefore, Schlotman is looking to grow grocery, one of his biggest categories.

One new addition to the company's center aisles is a revamped coffee section. Kroger has also reorganized sections of the store to provide more intuitive shopping.

Perhaps one of the most successful drivers to the center store is the natural and organic products category.

"More customers are choosing to live that lifestyle and want those products, and we are doing a really good job of converting people who have been long-time loyal Kroger shoppers—who didn't know, didn't care or didn't appreciate the breadth and depth of the offering we have in the organics—and are now standing in our store to buy those versus perhaps going to a competitor to buy them," Schlotman said. 

Finally, Kroger is planning on expanding its prepared food offerings in the center of the store.

Not only in the way of groceries, Kroger is planning to make other changes to brick-and-mortar stores, including major technology changes to address checkout and food spoilage, and to add a new data analytics program. Earlier this year, the company purchased You Technology Brand Services, a Silicon Valley-based provider of digital coupons and promotions.

For more:
-See this Food Business News article

Related stories:
Kroger CFO talks acquisitions
Kroger CIO envisions big tech changes across the enterprise
Kroger logs 45th consecutive quarter of growth
Kroger to add an additional market, focus on urban-format stores
Kroger buys digital coupon provider You Tech