Dive Brief:

• Food Lion has finished its $110 million update of 71 Richmond area stores, according to a company release.
• The project, which began earlier this summer, included expanding the assortment of produce and other fresh products, lowering prices and making stores easier to navigate. Food Lion has also hired 1,000 additional employees throughout the region.
• Food Lion has now updated 544 of its 1,000 stores since 2014, when it kicked off its remodeling push. The company says it will continue to update stores in the markets where it operates.

Dive Insight:

With these Richmond-area store updates, Food Lion has passed the halfway mark in the ambitious remodeling project it kicked off three years ago. In markets up and down the East Coast, the grocer has livened up its stores with a wider assortment of in-demand items, from produce to craft beer. It’s also lowering prices, improving store technology, hiring more associates — the works.

At more than $1 million per location, these updates aren’t cheap. But they’re vitally important for the legacy retailer at a time of unparalleled competition. Recent years have seen strong operators like Aldi, Walmart, Kroger and Trader Joe’s expand in the region. Now, discounter Lidl along with shopper-favorites Publix and Wegmans are moving in. Food Lion’s East Coast roots reach back almost 60 years, but history and tradition alone don’t stand a chance against lower prices, better selection and a better overall shopping experience.

With so many operators in the Mid-Atlantic region nowadays, stores need to have clear value messages and points of differentiation. Food Lion’s updates include not only lower prices and an expanded product assortment, but also technology updates like faster checkout and integration of a new mobile app.

The remodels are all-encompassing, but they may only be bringing Food Lion up to speed rather than putting it ahead of the curve. According to sources interviewed by Food Dive, these steps, while helpful, may not be enough to gain and retain customers against high-performing competitors.

At the same time, with Kroger struggling and Lidl failing to gain traction, Food Lion’s prospects may not be so bad after all. Bob Kelley, former director of operations at Ukrop’s, which was a Richmond institution before it sold off its retail stores several years ago, told Food Dive recently that Food Lion seems to be performing better than expected. Kelly, who now runs his own consulting firm and teaches at nearby Virginia Commonwealth University, said he’s been impressed with the recent updates.

Parent company Ahold Delhaize has singled out Food Lion in recent earnings reports, noting store sales are increasing with its remodels. As the updates continue and additional retailers move in on Food Lion’s turf, it will be interesting to see if these increases can continue.