BUSINESS

As retailers leave some cities, one grocery chain is trying to stay

Giant Food is taking several small steps to cut costs and stop theft without deterring customers

By Jaclyn Peiser
May 29, 2023 at 12:30 p.m. EDT



Ira Kress, president of Giant Food, says his company has taken some actions in an attempt to deter shoplifting. (Jahi Chikwendiu/The Washington Post)

Keith Redmond wasn’t thrilled when Giant Food closed one of the entrances to its supermarket in Bowie, Md., because it created a longer walk to the pharmacy for his elderly father. ... So when Redmond spotted company president Ira Kress walking past oranges in the produce section recently, he made a point of politely voicing his concerns for his father. “He’s got mobility issues,” said Redmond, who recognized Kress from his photo on signs around the store. “From a customer’s point of view, it’s frustrating.” ... Kress would rather not make it harder for shoppers to enter the supermarkets he oversees, but closing the entrance is worth it, he said, because it creates more obstacles for shoplifters and allows for fewer guards. It’s one way the regional grocery chain is trying to confront a trend reported by retailers across the country: rampant and pervasive theft.

Crime isn’t the only problem retailers face right now. There’s also decreased foot traffic in urban centers and inflation-related issues such as higher labor and real estate costs. Combined, these forces are leading some of the country’s largest companies to take a hard look at underperforming markets, and in some cases, close stores. ... But shoplifting is high on Kress’s mind these days. ... “To say [theft has] risen tenfold in the last five years would not be an understatement,” Kress said, noting that violence has also “increased exponentially.”

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The Bowie store is about 19 miles east of downtown D.C. But the problems retailers face have been particularly pronounced in larger cities — Walmart, Whole Foods, Nike, Kroger, Nordstrom, Old Navy and Target have announced exits from major urban areas. In addition to D.C. itself, other cities seeing news of stores pulling out include San Francisco, Portland, Philadelphia, Chicago, Atlanta and Seattle. ... The trend, which industry experts say is in its beginning stages, could foreshadow a further emptying of downtowns already wounded by the pandemic. Although retail vacancy rates for dense urban centers have been declining over the past decade, figures from real estate data firm CoStar show the numbers inching up in some cities.

“For the big box and the grocery [stores], which are trying to optimize a single-digit margin, it is very difficult to operate, and you will see more and more exits happening,” said Lakshman Lakshmanan, senior director in Alvarez & Marsal’s consumer and retail group. ... Giant Food — which has 165 supermarkets across D.C., Delaware, Maryland and Virginia — hasn’t closed any stores yet, and Kress said he’s taking certain actions, knowing they inconvenience shoppers, because “the alternative is worse for customers.” ... “The last thing I want to do is close stores,” Kress added. “But I’ve got to be able to run them safely and profitably.”



Baby food in locked cases at Giant Food in Bowie, Md. (Jahi Chikwendiu/The Washington Post)

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Gift Article
https://wapo.st/3WJG6es

By Jaclyn Peiser
Jaclyn Peiser covers retail for The Washington Post. She previously worked overnight on The Post's Morning Mix team and covered the media industry for the New York Times. Twitter https://twitter.com/jackiepeiser