Kroger is an American retail and multi-department store company that operates in the United States. The company was founded in 1883 by Bernard Kroger who used his life savings to open a small grocery store in downtown Cincinnati, Ohio. Over its long and successful history, Kroger has inherited various subsidiaries via mergers and acquisitions. Today, Kroger is the largest true supermarket operator in the United States with over 2,750 stores across 35 states. The company also owns fuel centers, pharmacies, department stores, jewelry stores, and in-store medical clinics.
| Subsidiary / Division | Business Category | Key Differentiator | Integration Strategy |
|---|---|---|---|
| Kroger | Grocery Retail and Supermarkets | Leading grocery store chain in the U.S. | Serves as the core business, operating a network of grocery stores, supermarkets, and related retail outlets. |
| Ralphs | Grocery Retail | Supermarket chain in Southern California. | Expands Kroger’s presence in California, offering a variety of grocery products and services. |
| Fry’s Food Stores | Grocery Retail | Supermarket chain primarily in Arizona. | Provides grocery shopping options in the Arizona market, complementing Kroger’s broader retail network. |
| Fred Meyer | Hypermarket and Department Stores | Hypermarket and department store chain. | Offers a combination of grocery, general merchandise, and other retail products, providing a one-stop shopping experience. |
| King Soopers | Grocery Retail | Supermarket chain in Colorado. | Expands Kroger’s presence in Colorado, offering grocery products and services. |
| Smith’s Food and Drug | Grocery Retail | Supermarket and drugstore chain. | Provides a range of grocery and pharmacy services, catering to customer convenience and health needs. |
| Harris Teeter | Grocery Retail | Supermarket chain in the Southeast and Mid-Atlantic. | Expands Kroger’s footprint in the Southeastern U.S., offering grocery and related services. |
| QFC (Quality Food Centers) | Grocery Retail | Supermarket chain in the Pacific Northwest. | Enhances Kroger’s presence in the Pacific Northwest, offering grocery products and services. |
| Dillons | Grocery Retail | Supermarket chain in Kansas and surrounding states. | Provides grocery shopping options in the Kansas and surrounding markets. |
| Roundy’s Supermarkets | Grocery Retail | Supermarket chain in the Midwest. | Expands Kroger’s presence in the Midwest, offering grocery products and services. |
| Mariano’s | Grocery Retail | Supermarket chain in the Chicagoland area. | Enhances Kroger’s presence in the Chicago market, providing grocery and retail services. |
| Kroger Health | Healthcare and Wellness Services | Health clinics, pharmacies, and wellness services. | Integrates healthcare and wellness services into Kroger’s retail locations, offering convenience and accessibility. |
| Kroger Personal Finance | Financial Services | Financial and money services. | Provides financial services, including prepaid debit cards and money transfer services, enhancing customer convenience. |
| Kroger Technology | Information Technology and Services | IT solutions, digital innovation, and analytics. | Drives digital innovation, data analytics, and technology solutions to improve operations and customer experiences. |
| Kroger Manufacturing | Food Manufacturing | In-house food production and manufacturing. | Produces private-label food products, ensuring quality and value for Kroger’s customers. |
| Kroger Brands | Private-Label Brands | Range of private-label products. | Offers a diverse range of private-label products across various categories, giving customers quality and value options. |
| Kroger Logistics | Supply Chain and Logistics | Supply chain and distribution solutions. | Optimizes supply chain operations, ensuring efficient delivery of products to Kroger’s retail locations. |
City Market
City Market is a supermarket brand that was founded in 1924 by Paul, Frank, Leo, and Clarence Prinster.
There are 35 City Market stores in the United States at the time of writing in the states of Colorado, Utah, Wyoming, and New Mexico.
City Market was acquired by the Dillon Companies in 1981, which then became part of Kroger when the two companies merged in 1983.
QFC
Quality Food Centers (QFC) is another supermarket chain with a strong presence in Washington state.
The company was founded by Jack Croco, a former Albertson’s employee who opened his own grocery store in Bellevue.
Over the 70s, 80s, and 90s, QFC expanded into surrounding counties and states with multiple acquisitions. The company was acquired by Fred Meyer in 1997 that was itself acquired by Kroger the following year.
Smith’s Food and Drug
Smith’s Food and Drug, affectionately known as Smith’s, is a regional supermarket chain that was founded in 1911 by Lorenzo Smith.
Smith’s was acquired by Kroger at the same time as QFC as part of the Fred Meyer deal.
This deal was the one that elevated Kroger to the largest supermarket chain in the country and also the nation’s largest supplier of milk and eggs.
It was estimated that the deal would result in $43 billion in revenue or around $67 billion in today’s money.
Mariano’s
Mariano’s is a grocery store chain that was founded relatively recently in 2010. The chain sells items such as smoked ribs, oysters, liquor, cheese, sushi, gelato, and smoothies.
Mariano’s expanded quickly in the Chicago area with 34 stores opening in the first five years of operation. When Kroger acquired Milwaukee-based supermarket chain Roundy’s in 2015, it also took control of Mariano’s in a deal worth around $800 million.
Food 4 Less (Foods Co)
Food 4 Less and Foods Co are no-frills grocery store chains operating in Illinois, Indiana, and Southern California where customers must bag their own items.
There are also other stores scattered around the country as part of franchise deals with different wholesale food companies.
Home Chef
Home Chef is a meal kit and food delivery that provides ingredients and recipes to customers in the United States every week. Each delivery contains fresh and pre-portioned items in recyclable packages that are ready to cook.
In May 2018, Kroger announced the acquisition of Home Chef for $200 million.
Key takeaways:
- Kroger is an American retail and multi-department store company that operates in the United States. Kroger is the largest true supermarket operator in the United States.
- Kroger subsidiaries include supermarket chains QFC, City Market, and Smith’s Food and Drug, with all three moving under the Kroger brand after acquisitions of other companies.
- Kroger also acquired Chicago-centric grocery store chain Mariano’s in 2015 when it purchased Milwaukee-based chain Roundy’s. Kroger also owns discount chain Food 4 Less and food delivery service Home Chef.
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