CINCINNATI, OH - As more retailers begin to hone in on the possibilities held within the produce aisle, fresh has increasingly become the focus of new sales bolstering strategies. The latest to lead with fresh is Kroger, as the retailer has rolled a blueprint for increased shareholder returns centered on fresh food and accelerating its digital presence.
"Kroger continues to deliver for customers through our seamless ecosystem and relentless focus on freshness, value and convenience," said Rodney McMullen, Chairman and CEO. "Building upon the foundation established by our Restock Kroger transformation, and leveraging key learnings from operating during the pandemic, our strategy of Leading With Fresh and Accelerating With Digital is designed to convert our industry's near-term tailwinds into long-term competitive advantages."
Through this strategic initiative, the grocer is hoping to deliver strong and sustainable shareholder returns between 8–11 percent, according to a press release. The company has also included plans to grow net earnings by 3–5 percent and increase free cash flow to invest in other growth initiatives.
"Today, Kroger is uniquely positioned because of the strength of our assets and our competitive moats cultivated over several years of disciplined investment and focused execution," continued McMullen. "Our go-forward strategy builds on these strengths to drive share growth, increase profitability across digital, and deliver strong and sustainable total shareholder returns. Our talented and energized team is already delivering on our objectives, and we look forward to continuing to position Kroger to win in a post-COVID world."
These details of the new strategy were discussed at an Investor Day event held on March 31. Other aspects of the initiative include:
- Growing sales and share by leading with fresh food
- Increasing profitability by accelerating with digital, which is now a growth engine
- Widening and deepening the competitive moats that will generate customer loyalty and market share gains—Seamless, Personalization, Fresh, and Our Brands
"Kroger is delivering on its value creation model, and over the period of 2019 to 2021, we expect to significantly exceed our total shareholder return target," said Gary Millerchip, Kroger's CFO. "The strength of our execution, combined with our strategic plans to continue to lead in fresh, accelerate digital, and grow alternative profit streams will enable us to achieve our 2021 guidance and deliver profitable growth beyond 2021."
How will fresh continue to play a pivotal role in retail strategies? AndNowUKnow will go in search of the answers.
