Six years after landing in the U.S. claiming it would “Rethink Grocery,” Lidl seems still to be trying to figure out how to pave a dependable path to profitability in the country, where the company faces tough competition as it looks to attract shoppers with its no-frills approach to food retailing.

In recent days, the company closed 11 stores in six states, primarily because the stores were underperforming, according to the Daily Mail.

The sudden closures across multiple markets are a clear sign that Lidl made fundamental errors in electing where to put its stores as it geared up in the U.S., putting the company in the uncomfortable position of having to cut its losses instead of deepening its roots, said Michael Infranco, assistant vice president of retail intelligence provider RetailStat.

Lidl’s decision early on to own rather than rent sites for stores exacerbated the issue, Infranco said. The company’s strategy of putting locations in multiple regions instead of concentrating more heavily on certain parts of the county also raises questions, he added.

“I’m sure in the conference room, there's no shortage of people saying, ‘We screwed up. Where do we go from here?’” said Infranco. 

Infranco added that he’s surprised Lidl didn’t take better advantage of the enormous boost the pandemic gave the grocery industry to strengthen its foothold in the U.S. “You would think it would be kind of hard to underperform in the environment that they've had,” he said. “Profitability-wise … they really dropped the ball.”

Infranco also pointed to the steady progression of executives who have led Lidl’s U.S. division as an indication that the company has struggled to settle on a playbook for success in the United States. In addition to shaking up its U.S. C-suite several times since establishing its U.S. headquarters in 2015, Lidl laid off about 200 workers at its headquarters earlier this year.

Lidl’s move to shutter multiple stores in the U.S. contrasts with how the company is operating in Britain, where the retailer has been busy expanding its fleet this year and opened 50 stores last year. In April, Lidl GB announced that it would pay a finder’s fee to anyone — including members of the public — who successfully identifies a site for a new Lidl location in Great Britain.

In case you missed it

Walmart offers half-price memberships

Walmart hasn’t said how many shoppers are enrolled in its Walmart+ membership program since it launched in 2020. But a lower-price version should significantly boost signups.

On Thursday, Walmart announced it’s offering access to its Walmart+ membership program for half price to shoppers who receive government assistance through programs like SNAP, WIC and Medicaid.

That brings the price for Walmart+ Assist, which offers the same services as a full-price membership, including free delivery, fuel savings, scan-and-go shopping and video streaming services, to $6.47 per month or $49 annually for those who qualify.

Trader Joe’s sues union for trademark infringement

Trader Joe’s has filed a lawsuit against its employee union, Trader Joe’s United, for selling merchandise that the grocer claims unlawfully uses its name and logo.

In the lawsuit filed last week, Trader Joe’s claimed that tote bags, buttons, mugs and other merchandise the union sells that feature the grocer’s name and logo violate its trademark rights and could cause “consumer confusion.” A lawyer for Trade Joe’s United told Reuters the lawsuit is part of a “union-busting campaign,” and the union has continued to sell the merchandise.

So far, four Trader Joe’s stores have unionized under Trader Joe’s United.

Food bank offers free groceries to striking writers and actors

Hollywood’s striking writers and actors have a place to turn if they’re struggling with their grocery bills.

World Harvest Food Bank in Arlington Heights, California, is offering free groceries to anyone who shows their Writers Guild of America (WGA) or SAG-AFTRA cards, according to the Los Angeles Times. The food bank typically asks for a $55 donation or four hours of volunteer time before giving out groceries.

World Harvest’s owner told the Times he’ll offer free groceries to writers and actors for as long as he’s able — though he’s not sure how long that will last.

Number of the week: $23 billion

That’s the amount of digital sales that grocers missed out on in 2022 due to products being unavailable or those that weren’t substituted for like products, according to a newly released report by insights firm Incisiv done in partnership with FMI – The Food Industry Association and Relex Solutions, a supply chain and retail optimization company.

The firms found that the grocery industry recorded a margin loss of $298 million on their digital grocery business in 2022. To address the unprofitability challenges with their digital businesses, surveyed grocers said they’re focusing on product availability along with fulfillment and inventory optimization. 

What’s ahead

Albertsons announcing latest earnings

The grocer is set to update investors Tuesday morning on its earnings for the first quarter of 2023, which ended on July 17. Because of the company’s proposed merger with Kroger, Albertsons will not host an earnings call. 

Impulse find 

Publix made headlines last week for inquiring on Twitter about which Pub Sub soccer star Lionel Messi purchased when he visited a Florida local store. Messi’s cart, according to pictures and video circulating on social media, show the athlete stocking up on milk, bread and classic sugary cereals like Lucky Charms. Messi’s trip comes about a week after him officially signing with the Major League Soccer team Inter Miami. 

Publix is still waiting to hear back from the new Florida resident about what #PubSub he tried.