Kroger touts Restock Kroger progress
In an update to investors, Kroger highlighted some of the successes of its Restock Kroger initiative, which has overhauled the retailer’s business model in an effort to deliver a shareholder return of 8% to 11%. Among the strengths that CEO and chairman Rodney McMullen said was the company’s convenience and omnichannel positioning ahead of the pandemic.
“Our customer obsession led us to make several strategic decisions three years ago to reinvent our business model to better serve our customers,” McMullen said. “We believed customers would continue to move to a seamless shopping platform that combined the best of physical and digital experiences. These choices and investments have positioned Kroger to more effectively respond to the pandemic. I could not be prouder of the way our people have pulled together with purpose to promote safety and support our customers and each other. We also share in the grief of so many whose loved ones lost their lives and livelihoods as a result of COVID-19.”
Another success story amid Restock Kroger has been the company’s cost-saving efforts, with those savings being reinvested into associate and customer experience — which includes Kroger’s private label strategy, dubbed Our Brands.
“We are improving the customer experience by widening and deepening our competitive moats that include fresh, seamless, personalization and Our Brands,” McMullen said. “These moats are strong today and growing in relevance as customers eat more food at home. We are improving the associate experience by focusing on talent, culture and wage investments.”
The company noted that since the start of fiscal 2017, it has returned roughly $6.4 billion to shareholders via dividends and repurchased shares.
Kroger also reconfirmed its 2020 guidance, noting that while the pandemic has caused difficulty, the company has seen wins when it comes to cost-saving efforts, sales and market share growth, and alternative profit streams.
“Based on the strength of our execution against our competitive moats, our food expertise, unparalleled data insights and expected structural shifts to food consumption at home as a result of COVID-19, we believe Kroger is well-positioned to continue to differentiate and grow in the future,” said Kroger CFO Gary Millerchip.