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Kroger Benefits from Private-Label Brands-Introducing Low-cost Line


In an earnings call following the release of financial results for the second quarter, Chairman and CEO of The Kroger Company, Rodney McMullen, noted that sales of private-label brands increased by 10.2 percent during the quarter, contributing to improved financial performance.  Home Chef™ and Kroger Our Brands, including Simple Truth®, Private Selection® and Heritage Farm® contributed to the improved sales.


Kroger will now introduce the Smart Way® private label within the Our Brands portfolio.  The Smart Way® line will appeal to budget-conscious consumers and will include canned vegetables, juices, bread and other staples


Juan DePaoli, Vice-President of Our Brands for Kroger, stated, “We are confident Smart Way will have something for everyone.  This new product line incorporates features families need to put an even more affordable meal on the table.”


It is possible that the Kroger initiative to introduce a lower-priced line of private-label items is an attempt to regain market share lost to the deep discount grocers, including Aldi and Lidl, where they compete.


Chairman and CEO, Rodney McMullen, stated, “In the movement to Our Brands what we always find is that customers are lured initially to save a bit of money, but they fall in love with our product.”  He added, “Part of the continued acceleration of growth in Our Brands is driven by value but part of it is just the quality of the product.”


Subscribers are referred to the report on the second quarter results for the Kroger Company in this edition.