Grocery store chains regularly evaluate their portfolios to determine whether underperforming or unprofitable units need to be closed.

Chains will often shut down stores when a site’s lease is set to expire. In severe cases, a company might close a location long before a lease expires if it no longer makes economic sense to keep the store open.

Those store closures are usually a huge disappointment to longtime shoppers who depend on their nearby grocers for regular shopping.

Supermarket chains have faced an array of economic challenges, which jeopardize their store locations, 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.

Many of these economic issues likely led a major supermarket chain to close several locations in March.

Kroger closes 3 California stores

Giant grocery chain The Kroger Co. will close three store locations in California in March and lay off 171 workers, according to Worker Adjustment and Retraining Notification notices filed with the California Employment Development Department.

The decision to close three stores is not an easy one, but extreme competition from big box retailers and large grocery chains often leads to shutting down underperforming stores.

Big box retail stores have dominated the grocery sector in recent years, with Walmart, Costco, and Target capturing about 37% of the combined U.S. market share in 2026, according to Xwiz Analytics.

Big box retail dominates grocery sector

Walmart is the top grocery retailer in the U.S., capturing about 23.6% of the market with over 5,200 stores and about $276 billion in revenue, followed by Kroger, which holds 10.1% of the market with over 2,700 stores and $147 billion in revenue.

Big box retailer Costco steps up with 9.2% of the market, over 600 stores, and $97 billion in revenue, while supermarket chain Albertsons grabs 6.4% of the market with over 2,280 stores and about $80.4 billion in revenue.

A third dominant big-box retailer, Target, has 3.2% of the market, with over 1,950 stores and $27 billion in grocery revenue.

“For many years, I’ve been sounding the alarm about the rise of national/discount grocers— Walmart, Target, Costco, Amazon, Dollar General, Family Dollar and Dollar Tree — and the existential threat that they pose to supermarket grocers, just as we’ve all seen over the last 20 years how department stores have been marginalized,” said Scott Moses, partner and head of the grocery, pharmacy, and restaurants advisory group at New York-based Solomon Partners, who spoke about rising competition at the GroceryShop trade show in 2023, Supermarket News reported.

Inflation impacts supermarkets

Along with fierce competition, supermarkets faced a spike in inflation after the 2020 Covid-19 pandemic, as food-at-home inflation increased by 11.4% in 2022 and 5% in 2023, while revenue rose only 0.5% higher in 2022 year-over-year, before falling below 2021 levels in 2023 and 2024 and recovering in 2025, according to February data from IBISWorld.

Many of these economic pressures have led Kroger to close several stores.

Kroger will close two Foods Co. and one Food 4 Less grocery store in California.

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Kroger WARN notices

Kroger filed three notices with EDD on Feb. 27, 2026, but all three stores will close in fewer than 60 days, which is usually the minimum time period of a WARN notice.

Kroger has not commented specifically on the timing or reasons for the closings.

The grocery chain owner filed a WARN notice with the state to close Foods Co. No. 784 at 3637 Shaw Ave. in Fresno, Calif., by March 14, 2026, and lay off 49 employees.

Kroger filed a WARN notice to close Foods Co. No. 371 at 8122 Gerber Road in Sacramento and lay off 58 workers also by March 14.

The grocery chain filed another WARN notice to close its Food 4 Less No. 364 at 3200 Century Blvd., in Inglewood, Calif., and lay off 64 workers by March 28.

“While the company committed to identifying transfer and reassignment opportunities for impacted associates, some layoffs and terminations may still be required based on operational needs and contractual provisions,” Kaina Pereira, executive director of the California Workforce Development Board, said in a WARN notice, the Sacramento Bee reported. “This closure will be permanent.

Kroger shuts down 60 locations

Kroger announced in June 2025 that it would close 60 stores over 18 months.

The 143-year-old grocery chain operates about 2,700 supermarkets across 35 states and Washington, D.C., according to its website.

Kroger California store closings:

• Foods Co. No. 784, 3637 Shaw Ave., Fresno, Calif., March 14, 2026, 49 layoffs.
• Foods Co. No. 371, 8122 Gerber Road, Sacramento, March 14, 2026, 58 layoffs.
• Food 4 Less No. 364, 3200 Century Blvd., Inglewood, Calif., March 28, 2026, 64 layoffs.
• Source: California Employment Development Department.

Related: Major national grocery chain closes 36 underperforming stores