Ahold Delhaize says it plans to close an undisclosed number of its near 400 Stop & Shop U.S. store locations due to underperformance.
“Stop & Shop has done a thorough evaluation and is focused on ensuring a stable and thriving future, which includes investments in price and customer service, along with optimizing the portfolio to focus on core markets where it can win,” JJ Fleeman, CEO of Ahold Delhaize USA, said during Ahold Delhaize’s recent Strategy Day event.
Fleeman said that over 190 stores have been remodeled with customer-focused upgrades, leading to better performance compared to non-remodeled stores, and efforts have been made to enhance their value proposition both online and in-store.
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“As Stop & Shop embarks on its next phase, we will be decisive and take deliberate and appropriate actions to ensure a stable future for the brand,” he said.
The company has expanded its digital capabilities to further enhance its e-commerce experience, achieving the highest e-commerce penetration among Ahold Delhaize’s five U.S. brands, Fleeman said.
“But that's not enough, and it's not where we want to be or need to be,” he said.
Stop & Shop will focus on the markets that are most important, including those where the brand has strong density, holds a strong market position or has stores that are performing well, he said.
“Stop & Shop has already evaluated its overall portfolio and will make difficult decisions to close underperforming stores to create a healthy store base for the long term and grow the brand,” Fleeman said.
Stop & Shop will prioritize operational excellence and efficiency through an improved organizational structure, focus on quality fresh products, well-stocked shelves, enhanced supply chain efficiency, and in-store service, Fleeman said.
Customers have already responded positively to Stop & Shop's remodel program, he said.
“The brand will use those learnings to deploy a more efficient use of capital as we further their remodels,” Fleeman said.
These investments will be fueled by leveraging scale to lower cost, streamlining operations and creating efficiency not only at Stop & Shop, but across the entire U.S. By making these moves, we are confident Stop & Shop can contribute even more to the U.S. business, he said.