Dive Brief:

• Southeastern Grocers plans to acquire five Lucky’s Market locations in Florida, the companies announced on Tuesday. The stores are located in Naples, Fort Meyers, Gainesville, Lake Mary and Melbourne. The Melbourne location was formerly listed under the purchase agreement announced last week by Lucky’s founders Bo and Trish Sharon.
• All five locations will become Winn-Dixie stores, a Southeastern Grocers spokesperson told Grocery Dive.
• Seabra Foods has agreed to buy a Lucky’s store in Hunters Creek, Florida, while Hitchcock’s Markets plans to buy the chain’s St. Petersburg location. Lucky’s has also entered into asset purchase agreements with Aldi for five leased locations and one owned location, and with Publix for five leased locations.

Dive Insight:

Could Southeastern Grocers be readying a new store brand under Winn-Dixie? It’s certainly possible. With an average size of around 47,000 square feet, the banner’s stores are considerably larger than Lucky’s, which take up around 30,000 square feet.

A Southeastern Grocers spokesperson declined to say if it was rolling out a new brand or just establishing smaller Winn-Dixie stores — or if it was planning to scrap the current sites and build full-size locations. He noted the opportunity to open stores in markets where it already operates successfully.

But a scaled-down strategy makes sense for Winn-Dixie, given what competitors are up to, what shoppers are demanding and how the chain has been evolving.

Publix has been building scaled-down Greenwise stores throughout Florida, while Aldi has had success building new locations and remodeling existing ones in the state. Across the country, retailers like Hy-Vee and Ahold Delhaize have launched small-format locations with lower operating costs, better site flexibility and fresh-focused positioning.

With Earth Fare and Lucky’s Market making their exit, grocers now have two fewer competitors for these scaled-down shopping experiences.

Southeastern Grocers has been refreshing its Winn-Dixie stores for several years and has quickened its pace in the wake of its own financial restructuring under Chapter 11, which was completed in spring 2018. The updated stores include hundreds of additional natural and organic products, meal stations, expanded produce and bakery sections and updated department signage.

Winn-Dixie wants to be seen by customers as a fun, modern grocery brand. It recently rolled out a new ad campaign featuring two exuberant shoppers clad in matching athletic gear. In a Super Bowl ad last Sunday, “the Twinns,” as they're known, raced around the store to find product deals in time for kickoff. The company then delivered its new tagline: “It’s a Winn-win.”