A grocery chain giant across most of America has a brand recognition problem in Florida, where they never heard of Kroger before. Despite the challenge, the provisioner to the masses wants to dominate the local market, through direct deliveries off all your groceries, unless you live in a swamp.
Kroger goes virtual
Kroger realizes that the way Americans buy their groceries has changed radically over the generations, from the days of a merchant pulling items from inventory at your request, to the miracle of “self-service” grocery stores pioneered by Piggly Wiggly. Up until 1916, nobody imagined things like checkout stands, individual item price marking or shopping carts.
George Bush Sr. was floored by laser scan check stands which had been in use nearly 20 years by the time he noticed. He expected price stickers. That general system worked well, until the year of the bat. When Covid came along, with lockdowns and quarantines, brick and mortar grocery stores started to go the way of the buggy whip.
Without opening a single storefront store in the entire state of Florida, “Kroger wants to attract tens of thousands of new customers.” All they need is a giant “shed” warehouse staffed by robots. We’ve suddenly regressed back to the pre-twentieth century mercantile model.
Instead of driving your wagon to the store, you tap out your purchase order on your phone. Instead of a human grocer who makes snide remarks about the things you purchase, robots mindlessly wander around and pull the order per instructions without even thinking about what they’re doing. They also don’t notice things like that big bruise on the tomato. The grocer expects the consumer to overlook things like that in the name of progress.
Kroger officials promise “a giant warehouse of robots that help retrieve such products as bananas, milk and meat.”
If they can hire enough vaccinated truck drivers they’ll have “a fleet of delivery drivers that drop off online grocery orders at people’s doors.” Not everyone’s doors, they admit, just those who live on paved roads.
Eight football fields
The robot workers will be getting lots of exercise as they crawl around an automated warehouse “big enough to fit nearly eight football fields.” Those don’t come cheap. It’s “a pricey bet for the grocer and an illustration of its e-commerce ambitions.”
Kroger already did some field testing in the U.K. after they “struck a deal with British online grocer Ocado to build a network of customer fulfillment centers.” That’s where they picked up the nickname “sheds”
Kroger “has opened two sheds so far, with plans for at least nine more over the next two years.” Some of those will be right here at home. Florida, they say, “is ground zero.” They want galactic domination of the market.
They plotted out “a national strategy to become a more dominant e-commerce player.” Already, they shelled out “at least $55 million just on construction” of the Florida shed alone. They already boosted the local economy.
As they get the project rolling, Kroger “has hired 900 employees and counting across the state.” They plan to use the operation as a model “to break into new markets and take on grocery rivals, including entrenched regional players like Florida-based Publix and retail behemoths like Amazon and Walmart.” That won’t be easy.
They know they have to fight for basic survival in a cut-throat industry. The “grocer must not only prove the sheds can power a large, profitable e-commerce business in a notoriously low-margin industry, it must also win over customers in a brand-new market where some may not even know its name. It may be the largest supermarket operator in the country, but in the state, Kroger is the newcomer and, at least initially, the underdog.”