How Did Richmond Become the Epicenter of Grocery Wars?

It seems as if every week there is an announcement of the opening or expansion of yet another grocery store in the Richmond metropolitan area. Jeff Cooke with Thalhimer recently stated in a Richmond Times Dispatch article that the grocery sector of retail is "driving development" in the Richmond area because there is not "much else in the retail sector being constructed." Some, but not all, of the "players" and their recent "plays" are:

At a recent commercial real estate group event, one of the speakers noted that there are at least two other grocers "eyeing the Richmond market," but was not in a position to release the names. Speculation is that the potential candidates are Stew Leonard's and Earth Fare.

To add to the intensity of the competition in this market, Kroger recently started filling online grocery orders at its Ironbridge Road location. Customers can place orders for over 40,000 items online have the orders brought to their vehicles without having to park and enter the store. Kroger plans to expand this service to most of its other locations by the end of the year.

So, what is driving all of this activity? A recent blurb in the International Council of Shopping Centers' weekly e-newsletter noted that grocery stores are seeking to create convenience for their customers by locating near other services that shoppers need and frequent, including dry cleaning, optometry, physician, veterinarian, and similar service-oriented businesses. Many grocery stores even offer coffee bars and community meeting areas and are becoming the social gathering spots for friends and neighbors.

The Pew Research Group provides additional insight. Its studies reveal that in 2015 Millennials outnumbered Baby Boomers for the first time. Millennials are a busy generation and are known for seeking service and lifestyle conveniences. The grocery industry is catering to the needs of this new generation of shoppers by conveniently locating their stores and also by placing a significant focus on prepared foods.

It seems that the Richmond metropolitan area, with its thriving restaurant, craft beer and apartment scene, as well as its established areas in the City and in the surrounding suburbs, has just the right demographic mix to satisfy the requirements of many of the "players" in the grocery market. At least, that's my take, and I am sticking to it!

Stay tuned for updates! Richmond's grocery industry is hot and new developments appear almost weekly!

(To read the second article of the Richmond Grocery Wars series, please click here. To read the most recent update, please click here.)

Spotts Fain publications are provided as an educational service and are not meant to be and should not be construed as legal advice. Readers with particular needs on specific issues should retain the services of competent counsel.


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