Dive Brief:
- Lucky’s Market announced it will add 20 new stores over the next 18 to 24 months, according to Supermarket News. That’s nearly double the natural and organic grocer’s current roster of 28 stores.
- Sixteen of the new stores will open in Florida, where Lucky’s has focused much of its recent growth. Cities that will see new locations include Fort Myers, Naples, Orlando, Cape Coral, Winter Park, Vineland and Lake Mary. Lucky’s will also open two locations in its home state of Colorado — in Wheat Ridge and Fort Collins — as well as in Missoula, Montana and Cleveland, Ohio.
- Lucky’s said it also has letters of intent for “a handful” of other stores, and will publicize those locations at a later date. Started in 2003 by chefs Bo and Trish Sharon, Lucky’s currently operates in 11 states and in 2016 received a strategic investment worth an undisclosed amount from Kroger.
Dive Insight:
After years of modest growth, Lucky’s Market is putting its expansion plans into high gear. The chain’s affable vibe and low-priced natural and organic products have resonated in cities across the country, and now, with competitors like Sprouts Farmers Market expanding quickly, the need to accelerate its growth is clear.
Lucky’s growth model to date has been an interesting one. Rather than cluster its stores in a particular region, it’s chosen cities where the demographics — read, millennials — line up favorably with the competitive landscape. There’s a Lucky’s Market store in Jackson Hole, Wyoming and another in Savannah, Georgia.
Lately, the grocer has focused its growth on Florida. The state has large pockets of millennial consumers in cities like Orlando and Tampa. It also has a unique proposition when compared to longtime traditional grocers Winn-Dixie and Publix.
Lucky’s Sunshine State foray also traces back to Kroger’s strategic investment in the company, analysts have told Food Dive. Rather than go head-to-head with Publix on its home turf, Kroger is helping bankroll a promising upstart and learn a thing or two about natural and organic retailing in the process. If Lucky’s continues to do well in Florida and elsewhere, it wouldn’t be a surprise to see Kroger fully acquire the chain.
Lucky’s hopes to continue succeeding by adhering to its all-natural roots while also offering a compelling store experience. The company offers fresh “never ever” meat produced without growth hormones or antibiotics, an extensive bulk bin collection and prepared foods. Customers can sip a beer while they shop, and Lucky’s frequently has meet-the-farmer talks, wine tastings and other events.
“I think Lucky’s has a combination of authenticity, combined with approachability that makes it stand out among its rivals,” Neil Stern, senior director with consulting firm McMillanDoolittle, recently told Food Dive.
Despite Lucky’s positive momentum, it faces stiff competition from Sprouts Farmers Market, which is opening around 30 new stores a year, and Earth Fare — both of which are growing in Florida. Publix has also reignited its Greenwise stores, which offer natural and organic items inside a smaller box.
Lucky’s will need to evolve to meet consumer demand. This includes online ordering, which it doesn’t have but plans to roll out this year, a representative told Food Dive. It may also need to sharpen its elbows and compete more aggressively on pricing and promotions. Lucky’s is used to being a novelty in markets where it operates. It's unclear if it has what it takes to play hardball in some promising but very crowded markets.
