Major supermarket chains, including Kroger, Stop & Shop, and The Raley’s Companies, are in the middle of a downsizing mode that began in 2025 and will continue for some companies through 2027.
Kroger said it expected to close approximately 60 stores across its portfolio by the end of 2026, according to the company’s first-quarter fiscal 2025 earnings call. Giant Ahold Delhaize’s Stop & Shop chain confirmed in July that it will close store locations in Basking Ridge and Westfield, N.J., also in 2026
And now Raley’s has said that it will close another Northern California store located in Petaluma, Calif., on Jan. 26, 2027, affecting 48 workers’ jobs.
Raley’s closes 7 stores
The closures are part of Raley’s regional downsizing plan that calls for seven store closings in California and Nevada. Raley’s said it will offer transfer opportunities to as many affected employees as possible, KSRO radio reported.
The Raley’s Companies cited local market conditions and long-term financial sustainability for the downsizing.
The West Sacramento, Calif., grocery store chain began its downsizing plan with the closing of its Raley’s store in Roseville, Calif., in January 2026, followed by the closure of its store in Antioch, Calif., in April. The chain had allowed both store leases to expire.
The supermarket chain continued closing stores by shuttering a Nob Hill Foods store in Mountain View, Calif., on May 29, 2026, affecting 50 employees.
Underperforming store leads to closure
Raley’s followed up its Mountain View closure with the announcement that it will close its Nob Hill Foods store in Los Gatos, Calif., when its lease expires in June 2027, after reviewing the store’s performance and current economic conditions, the company’s Chief Marketing Officer Carol Barsotti said.
The company also plans to close its Raley’s store in Brentwood, Calif., on Nov. 3, 2026, and an Elko, Nev., location in December 2026, according to SFGate.
“Thoughtful stewardship sometimes means opening stores and sometimes it means making difficult decisions to close them,” The Raley’s Companies spokesperson Chelsea Carbahal told SFGate.
Foot traffic, sales impacted
Raley’s brick-and mortar locations have faced more competition with online marketplaces and changing customer preferences, which impacted store foot traffic and overall sales, Carbahal said.
Despite the downsizing plan, Raley’s plans to open a new store in March 2027 in the Central Valley city of Madera, Calif.
Grocery stores face challenges to remain profitable, including competition from regional and national supermarket chains, rising costs of products and labor driven by inflation, consumers’ changing attitudes toward products, and lease rates that don’t make economic sense.
Stores face revenue challenges
Supermarkets faced increased food-at-home inflation after the 2020 Covid-19 pandemic, rising by 11.4% in 2022 and 5% in 2023, while revenue peaked only 0.5% higher in 2022 year-over-year, before falling below 2021 levels in 2023 and 2024 and recovering in 2025, according to data from IBISWorld.
Store closings even hit a chain that had never closed a store before. 78-year-old grocery chain operator, Cosentino’s Food Stores closed its Price Chopper location in Overland Park, Kan., in February, marking the first store it has closed in its history.
Cosentino’s operates 24 Price Chopper, three Sun Fresh, three Cosentino’s Markets, two Apple Market, and a Market 48 Liquor store.
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