Over the weekend, Kroger (KR) announced plans to hire 20,000 employees -- adding more than 5 percent to its current staffing. Already the nation's largest supermarket chain and its second largest retailer (after Walmart (WMT)), Kroger says it is on a "growth trajectory." Last quarter, the company grew its sales 10 percent year over year.
Maintaining that pace, however, could be difficult when competing with more popular grocery store rivals.
Ranking the Rivals
Harris Poll EquiTrend, now owned by Nielsen (NLSN), recently conducted its first poll of grocery store popularity. Kroger, it turns out, with annual sales of $98.4 billion and operations in 34 states and the District of Columbia, remains one of the more popular chains. It ranks fourth and seventh, respectively, in two of America's four regions for grocery store operations.
As for the other brands, well, Harris says it polled 41,806 U.S. consumers ages 15 and up Jan. 3-Jan. 31, asking their opinions on a wide range of well-known brands, supermarkets among them. Kroger -- which operates stores under dozens of names, including Ralphs and Fry's -- scored best in its home Midwest region, where the top eight supermarket brands were (in order from most popular to least):
The top five performers in America's other regions:
In the Northeast: Wegmans, Trader Joe's, Whole Foods, ShopRite and Hannaford Bros.
In the South: Publix, Walmart, H-E-B, Trader Joe's and Harris Teeter (now owned by Kroger -- so that means Kroger actually placed twice on the list in the South, where its namesake chain came in seventh).
And in the West: Costco (COST), Trader Joe's, Whole Foods Market, Safeway (SWY) and Stater Bros.
What's the Common Denominator?
As you can see, each region has its favorites -- Costco in the West, Publix in the South, Hy-Vee in the Midwest and Wegmans in the Northeast. Kroger may be the nation's biggest pure-play supermarket chain, but no one chain dominates in more than one region.
Two chains, however, do appear very popular across the country. Both Trader Joe's and Whole Foods rank in the top five supermarket chains in three of the four U.S. regions -- missing out narrowly on a clean sweep due only to their sixth-place finishes in just one market each: the Midwest for Trader Joe's, and the South for Whole Foods.
If Kroger hopes to maintain its growth trajectory, it would appear that Trader Joe's and Whole Foods are the rivals to beat.
Motley Fool contributor Rich Smith has no position in any stocks mentioned. The Motley Fool recommends and owns shares of Costco Wholesale and Whole Foods Market.John Mackey, co-CEO of Whole Foods Market, is a member of The Motley Fool's board of directors. Try any of our Foolish newsletter services free for 30 days. To read about some of our favorite dividend stocks, check out our free report.
13 Ways Beyond Coupons to Save on Groceries
Which Supermarkets Are America's Favorite? The Votes Are In
The best deals of the week go to loyalty card users. These items often include what are known as "loss leaders" -- items sold at little or no profit for the store. Why do stores do this? To draw you into the store, with the hope that you'll pick up other items as you shop. Some stores also reward you for spending more. Safeway (SWY) and Stop & Shop offer discounts at partner gas stations. Deals are also advertised in the weekly circular, and you can scan those savings onto your smartphone through apps such as Spoofee.com or SundaySaver.com.
You might like to see and feel every apple or potato you put into your shopping cart, but you can save as much as 36 percent by buying bags of produce. The same is true for multipacks of grocery items such as soap, toilet paper, soda and yogurt, especially at stores such as Walmart (WMT) and Target (TGT).
Many popular deli meats and cheeses sliced fresh at the deli counter may cost less than the pre-packaged variety. SmartShop found the same brands (including Boars Head and Alpine Lace) as much as 30 percent cheaper at the deli counter. You also get to buy the exact amount you need, reducing potential waste.
These racks, usually found in the back of the store, include a hodgepodge of items marked down by as much as half. That's because there is an imperfection in the packaging or the item is being discontinued. Check the expiration date to make sure that you're not buying something that's been sitting on the shelf too long.
Several new subscription services rival Amazon.com's (AMZN) Subscribe & Save service. ShopSmart likes FamilyCircle.com, Plated.com and Target Subscriptions. FamilyCircle.com offers organic produce and seasonal items that can be shipped to your home weekly. It's only available in Washington state, Idaho, Alaska and San Francisco, but there are plans to expand. Plated.com provides measured ingredients to make a chef's recipe from scratch. Target offers household and personal care items at a 5 percent discount (10 percent for REDCard holders). It also offers food, even though the selection is limited. The best thing about them: membership is free.
Shoppers can save as much as 60 percent by choosing the store brand over a national brand. Many people find the taste and quality of store brands to be just as good as the more costly brand names.
Walmart and Target, the big players in this category, offer savings of up to 70 percent on toiletries, drugs and other items. A recent Consumer Reports survey ranked Target better for customer service, quality of perishable items and cleanliness, while Walmart came out slightly ahead on price. Both will price match items you find cheaper at other stores.
There may be a stigma to shopping at dollar stores, but if you can get past that you can find some real bargains. Many leading dollar stores have been increasing the number of food items they sell. Family Dollar Stores (FDO) -- which agreed this week to be acquired by Dollar Tree (DLTR -- recently added 400 food items. Savings of up to 28 percent can be found at dollar stores over supermarket prices.
Club membership is down, but Costco (COST), Sam's Club and others are still great places to save if -- and this is a big if -- you have the space to store bulk purchases. ShopSmart found savings of up to 63 percent on some items. It also gives high ratings to some of Costco's Kirkland brand, including its bacon, laundry detergent and toilet paper.
Boxed gives you warehouse prices (and sizes) without paying a membership fee. Checkout 51 offers weekly specials on items such as Campbell's (CPB) soup or Prego sauces. You also get cash back for every $20 you spend. Flipp is great for checking store circulars for weekly specials. You can put items right onto your shopping list, and the app helps identify the best deals. All three of these apps work on Android and Apple (AAPL) phones and tablets.
Convenience stores and drug stores may be easy to run into and pick up some essentials, but you'll pay top dollar for that convenience. ShopSmart's price check found these stores consistently charged a lot more, often more than double the price at supermarkets, Target and Walmart on basics such as milk, bread and eggs. A half gallon of milk at 7-Eleven costs $3.12. Compare that to the average supermarket price of $2.30. And a loaf of whole wheat bread at CVS (CVS) cost $2.91. At a dollar store the same loaf costs -- yes, you guessed it -- $1