Dive Brief:

• Sprouts Farmers Market will open six stores in this year's second quarter, including its first location in South Carolina, according to a news release. 
• The South Carolina store will be located in Simpsonville. Sprouts will also open new stores in Charlotte, N.C.; Lincoln, Calif.; San Diego Calif.; Augusta, Ga.; and Sparks, Nev.
• The discount natural and organic grocer plans to open 30 stores this year, and executives have said the retailer could grow to as many as 1,200 locations across the country. By the end of this year, Sprouts will have stores in 19 states.

Dive Insight:

While a lot of major grocery chains, including Kroger and Walmart, have curbed their store growth, Sprouts Farmers Market is hitting the gas. That's because the natural and organic chain sees an opportunity to steal market share from other grocers — particularly conventional ones — with its low-price, fresh-focused format.

In a recent interview with Food Dive, CEO Amin Maredia articulated this vision for Sprouts. He emphasized that despite investor concern over Amazon's impact on his company, Sprouts has the Food Lions and Safeways of the industry in its sights.

"Those grocery stores have not kept up with the consumer," he said. "When somebody says the industry is overstored, the first assumption is that all 27,000 [conventional] stores are relevant. Five to seven thousand do a good or a great job, but there are 10,000 to 15,000 stores that are old, dingy, underinvested, have cut labor down to the bone to where you just don't want to be there."

Whether conventional grocers are truly this out of touch or not is up for debate. But analysts say Sprouts offers something that's unique and compelling, and that's evolving in meaningful ways. Sprouts is ramping up its private label assortment, for one. It's also zeroing in on prepared foods with an enhanced deli department that's now going into new stores and being added on to some existing ones. Maredia said that compared to four years ago, Sprouts' new stores are selling 15% to 20% more volume in their first year.

"The sales productivity at those stores is meaningfully higher than their legacy store base," Ben Bienvenu, a research analyst at Stephens who covers Sprouts, told Food Dive.

Sprouts certainly has its work cut out for it. The Mid-Atlantic region has become a free-for-all for discounters, traditional supermarkets, supercenters and now service-first chains like Publix and Wegmans. California, meanwhile, particularly Southern California, remains one of the toughest regions in the grocery business.

But Maredia is confident in Sprouts' approach, and strong financial results of late have brought more industry observers over to his side. In the third quarter of 2017, Sprouts posted 4.5% same-store sales growth and a 19% increase in gross margins.

"People are increasingly conscious of what they're eating, and at Sprouts we want to give them those fresh, less-processed foods while taking away the impediment of, 'I can't afford it,' " said Maredia.