Shoppers fleeing high prices boost bargain and discount food retailers

Grocery Outlet continues to push its East Coast brick-and-mortar expansion. The Emeryville, California-based retailer on Thursday will open its newest store in northeast Philadelphia.

Located in Philadelphia County at 4016 Woodhaven Rd., the new store will employ 25 people and boasts bargain prices on groceries with a business model targeted at consumers who are seeking value.

“We are so thrilled to be a part of the Northeast Philadelphia community and provide big savings on quality groceries,” said independent Grocery Outlet operators Mo and Safa Abuhillo. “This partnership with Grocery Outlet gives us the ability to grow our business, create new jobs and more importantly, give back to the local community.

Grocery Outlet stores are owned by independent operators based in the communities they serve.

Offering the same brands as traditional grocery stores but at lower prices, Grocery Outlet is navigating 2023 with a winning growth strategy, according to a report released earlier this year from Placer.ai. Grocery Outlet was the only grocery retailer to make the list.

Bargain-seeking shoppers are also fueling growth for Ollie’s Bargain Outlet.

Earlier this month, Ollie’s Bargain Outlet Holdings, Inc. reported that net sales edged up at 12.9% to $459.2 million for the fiscal 2023 first quarter, with new store growth also continuing for the quarter.

The retailer reported it opened nine new stores and closed one store, ending the quarter with 476 stores in 29 states, a year-over-year increase in store count of 8.4%.

This month, Ollie’s has plans to open two new stores in Texas. Next Wednesday, it will open a new store at 2900 W. Washington St. in Stephenville and later this month a new store will open in Abilene at 841 N. Judge Ely Blvd.

“We are pleased with our first quarter performance, which exceeded our expectations and was driven by strong comparable store sales, new store productivity and margin expansion," said John Swygert, Ollie’s president and CEO, in a statement. “Customers are responding to our compelling deals, resulting in accelerating transaction trends, and we are encouraged to see our product offerings appealing to a wider customer base that includes more higher-income and younger-age shoppers.”

Discount grocer Aldi is also setting a record pace for new store openings, according to the monthly tally by Winsight Grocery Business.

“While inflation is undoubtedly driving unprecedented demand for affordable groceries, we know that once customers experience the Aldi difference, they keep shopping with us, even when the economy improves,” said Jason Hart, CEO of Aldi U.S., in a statement regarding the discount grocer’s 2023 growth plans. “Our growth is led by our customers, and they continue to want more Aldi locations coast-to-coast.”