In the recent times, some of the most prominent retailers have been shuttering stores. While the entire sector is struggling with sagging sales, supermarket giant Kroger (KR) is making a bold move by hiring thousands of new employees for its supermarkets’ division.
The grocery price war intensified in the U.S. and Amazon (AMZN) is not the only reason for this. Last year, when Amazon entered the brick-and-mortar retailing with the acquisition of Whole Foods Market for $13.7 billion, there was a great fear among retailers mainly the grocery retailers. The pressure further intensified as German discounters Aldi and Lidl are expanding in the U.S. at a faster pace.
To stay in the race amidst the heated competition, Kroger continues with its hiring spree. This time the grocery chain intends to hire about 11,000 workers for its supermarkets’, including 2000 jobs for management roles. Kroger is also investing $500 million that is for wages and training and development.
Kroger operates in 35 states with more than 2,700 groceries. It operates under a variety of names that includes Ralphs, Smith’s, King Soopers, and Fred Meyer. In 2016, the company hired 12,000 people.
It’s not just Kroger, even the rivals like Costco, Sam’s Club, and Walmart are offering new features to entice the customers. For example, Walmart, it came out with an online grocery delivery that aims to make grocery drop-offs an option to more than 40% of the households.
The retailers are working on technology upgrades too. Kroger, last year came out with a pilot program ‘Scan, Bag, Go’ that was experimented with 20 stores. And now the company plans to expand the service to more 400 stores this year.
Just a few weeks back, there were rumors about Target merging with Kroger. Though no talks have been initiated from both the ends, a merger of the two would make sense as both the companies together could battle against the growing threat from Amazon.
Kroger is primarily in the midst of a massive turnaround effort.
It has been refreshing, relocating and closing stores to turn to more profits. And outside one of those closed stores, a civil rights activist Rev. Jesse Jackson is calling for a national boycott of Kroger because the company mostly pulled out its stores in black neighborhoods. Uncertainty in this industry is at a high level as it is now dealing with continuous disruption.
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