Stop & Shop closing 32 underperforming grocery stores in the Northeast

Stop & Shop said Friday it will close 32 underperforming grocery stores in the Northeast U.S. by the end of the year.

The chain, which is owned by the Dutch supermarket company Ahold Delhaize, said it will close 10 stores in New Jersey, eight stores in Massachusetts, seven stores in New York, five stores in Connecticut and two stores in Rhode Island.

The company said employees at affected stores would be offered other jobs within the company. Asked by The Associated Press how many people are employed at the 32 stores, Stop & Shop wouldn’t say.

Stop & Shop, which got its start in 1914 in Somerville, Massachusetts, operates around 400 grocery stores and has 60,000 employees.

In an interview with The Associated Press, Stop & Shop President Gordon Reid said the closures are a difficult but necessary step to stabilize the business.

“These stores are not making a profit,” he said. “They take away from the whole organization. We need to focus on the parts that we need to invest in and want to invest in.”

Reid said Stop & Shop will continue to build new stores and remodel existing ones. The brand, which has remodeled 190 stores since 2018, will also invest in lower prices and promotions at its remaining stores, he said.

Stop & Shop will continue to have buying power even with fewer stores because of its parent company, according to Reid. Ahold Delhaize operates more than 7,700 grocery stores worldwide, including the Food Lion and Giant brands in the U.S.

Burt Flickinger, a longtime retail consultant and owner of Strategic Resource Group, said many of Stop & Shop's problems were self-inflicted. The brand closed fresh meat and seafood counters in some stores, for example, which cut down on the amount customers spent in those stores.

Stop & Shop is also getting squeezed by big rivals like Walmart and Costco, and discount chains like Aldi and Lidl.

“Wherever a Target, a Walmart a Costco or a BJ’s has been built, a Stop and Shop’s in jeopardy,” Flickinger said. "While they have a plan going forward, I’m not sure the plan’s going to be fully competitive given the intensifying level of competition.”

Reid said Stop & Shop can compete because it has convenient locations, high quality and a good product assortment. Lowering prices will also help the business, he said.

“Our customers love Stop & Shop, and they want us to have a strong future,” he said.