Huge national grocery chain closes 36 stores after overexpanding

According to WDEF-TV, data from Coresight Research shows that the retail apocalypse continues in 2025, with 8,100 retail stores closing across various industries, an increase of 12% compared to 2024.

The grocery chain contributed to the disaster, with Albertsons cutting 380 jobs at corporate offices in Arizona and California and saying it would close 20 stores by the end of 2025.

Kroger subsequently closed nine distribution centers and eliminated about 1,700 jobs. The company operates about 2,700 supermarkets in 35 states and Washington, D.C., and announced in June 2025 that it would close 60 stores within 18 months.

In addition, Grocery Outlet, a supermarket chain that has been growing, has joined the list of supermarket chains closing dozens of stores.

Kroger followed through on its closure plan, filing notices in March to close three California store locations and laying off 171 workers, according to worker adjustment and retraining notices filed with the California Employment Development Department.

“While the company is committed to exploring transfer and reassignment opportunities for affected employees, some layoffs and layoffs may still be necessary based on operational needs and contract terms,” ​​Kena Pereira, executive director of the California Workforce Development Board, said in a warning notice, according to the Sacramento Bee. “This closure will be permanent.”

Grocery Outlet closed 36 unprofitable stores due to excessive expansion. Shutterstock
Grocery Outlet closed 36 unprofitable stores due to excessive expansion. Shutterstock · Shutterstock

According to Investing.com, national discount supermarket chain Grocery Outlet said during its fourth quarter 2025 earnings call that it would close 36 stores across the country due to excessive expansion.

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“After rigorous analysis of our fleet, we found that there is no viable path to sustained profitability for the 36 stores in our network, regardless of the operational support we can provide,” Grocery Outlet Holding Corp. CEO Jason Potter said on an earnings call.

“We have made the difficult decision to close 36 locations, 24 of which are in the East, representing 30% of the region’s fleet,” Porter said. “We are not completely exiting any state and we believe we have a meaningful opportunity to grow in the East over the long term.”

The company has not announced the list of 36 stores that will close.

Porter said the Emeryville, Calif.-based chain’s remaining 51 stores in the East region were profitable, with a net profit margin of 3.3% in the fourth quarter.

“It’s now clear that we expanded too quickly and these closures are a direct correction,” Porter said.

More closures:

Porter said the closures of 36 stores, or about 6% of its stores, are expected to result in an improvement in annualized adjusted EBITDA of approximately $12 million and position the company to be profitable in all markets.

The 80-year-old company still plans to open 30-33 new stores in 2026 under a more rigorous approach.

For example, when Grocery Outlet opens new stores in Virginia later in 2026, the stores will start as corporate operations, allow them to become profitable, and then transfer them to independent operators.

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Founded in 1946 as a can sales business in San Francisco, Grocery Outlet operates more than 560 stores through its network of independent operators in 16 states.

  • alabama

  • california

  • delaware

  • Georgia

  • idaho

  • kentucky

  • Maryland

  • nevada

  • new jersey

  • North Carolina

  • Ohio

  • oregon

  • pennsylvania

  • tennessee

  • virginia

  • washington

  • Source: Grocery store

RELATED: 143-year-old grocery chain closes more stores, lays off dozens of jobs

This article was originally published by TheStreet on March 5, 2026, and first appeared in the Retail section. Click here to add TheStreet as your preferred source.

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