The Kroger Co. (Kroger) operates as a food and drug retailer in the United States.
The company operates supermarkets, pharmacies and fuel centers in 35 states and the District of Columbia while also operating online through a digital ecosystem to offer customers an omnichannel shopping experience. The company also manufactures and processes food for sale by its supermarkets and online. Kroger is diversified across brands, product categories, channels of distribution, geographies and consumer de...
The Kroger Co. (Kroger) operates as a food and drug retailer in the United States.
The company operates supermarkets, pharmacies and fuel centers in 35 states and the District of Columbia while also operating online through a digital ecosystem to offer customers an omnichannel shopping experience. The company also manufactures and processes food for sale by its supermarkets and online. Kroger is diversified across brands, product categories, channels of distribution, geographies and consumer demographics.
Strategy
The company’s strategy focuses on growing households and increasing customer loyalty by delivering great value and convenience, and investing in four strategic pillars: Fresh, Brands, Data & Personalization and Seamless.
Stores
Kroger operates supermarkets under a variety of local banner names in 35 states and the District of Columbia. Kroger operates either directly or through its subsidiaries, supermarkets, pharmacies and fuel centers. The company’s stores operate under a variety of banners that have strong local ties and brand recognition. The company connects with customers through its expanding seamless ecosystem and the consistent delivery of a full, fresh, and friendly customer experience. Fuel sales are an important part of the company’s revenue, net earnings and loyalty offering. The company’s fuel strategy is to include a fuel center at each of its supermarket locations when it is feasible, and it is expected to be profitable. Each fuel center typically includes five to ten islands of fuel dispensers and storage tanks with capacity for 40,000 to 50,000 gallons of fuel.
Seamless Digital Ecosystem
The company offers a convenient shopping experience for its customers regardless of how they choose to shop with the company, including Pickup, Delivery and Ship. The company offers Pickup and Harris Teeter ExpressLane— personalized, order online, pick up at the store services — at 2,412 of its supermarkets and provide Delivery, which allows the company to offer digital solutions to substantially all its customers. The company’s Delivery solutions include orders delivered to customers from retail store locations, customer fulfillment centers and orders placed through third-party platforms. These channels allow the company to serve customers anything, anytime and anywhere with zero compromise on selection, convenience, and price. The company also provides relevant customer-facing apps and interfaces that have the features customers want that are also reliable, easy to use and deliver a seamless customer experience across its store and digital channels.
Merchandising and Manufacturing
The company’s brands products play an important role in its merchandising strategy. The company’s supermarkets, on average, stock over 12,000 private label items. The company’s brands products are primarily produced and sold in three ‘tiers.’ Private Selection is the company’s main premium quality brand, offering customers culinary foods and ingredients that deliver amazing eating experiences. The Kroger brand, which represents the majority of the company’s private label items, is designed to consistently satisfy and delight customers with quality products that exceed or meet the national brand in taste and efficacy, as well as with unique and differentiated products. Big K, Smart Way and Heritage Farm are some of the company’s value brands, designed to deliver good quality at a very affordable price. In addition to the company’s three ‘tiers,’ its brands offer customers a variety of natural and organic products with Simple Truth and Simple Truth Organic. Both Simple Truth and Simple Truth Organic are free from a defined list of artificial ingredients that some customers have told the company they do not want in their food, and the Simple Truth Organic products are USDA certified organic. The company owns food production plants. These plants consisted of dairies, deli or bakery plants, grocery product plants, beverage plants, meat plant and cheese plants.
Data
The traffic and data generated by the company’s retail business, including pharmacies and fuel centers, enables its diverse business. Kroger serves approximately 63 million households annually and because of the company’s rewards program, over 95% of customer transactions are tethered to a Kroger loyalty card. The company’s retail media business – Kroger Precision Marketing – provides differentiated media capabilities for its consumer-packaged goods partners and other industry verticals. It is a key driver of the company’s digital profitability and alternative profit.
Segments
The company operates supermarkets, multi-department stores and fulfillment centers throughout the United States. The company’s retail operations, which represent 98% of its consolidated sales, are its only reportable segment. The company aggregates its operating divisions into one reportable segment. In addition, the company’s operating divisions offer customers similar products, have similar distribution methods, operate in similar regulatory environments, purchase the majority of the merchandise for retail sale from similar (and in many cases identical) vendors on a coordinated basis from a centralized location, serve similar types of customers, and are allocated capital from a centralized location.
Seasonality
The majority of the company’s revenues are generally not seasonal in nature. However, revenues tend to be higher during the major holidays throughout the year (year ended December 1, 2025). Additionally, certain significant events including inclement weather systems, particularly winter storms, tend to affect the company’s sales trends.
History
The Kroger Co. was founded in 1883. The company incorporated in 1902.