RecorNews
Monthly Industry Dispatch
The next era of grocery is being built in real time.
Private label is growing up, store remodels are reshaping the shopper experience, and Albertsons and Kroger are both investing heavily in leaner, sharper operating models. The bar is rising for every brand on shelf.
I hope the month of May is off to a great start for you. I know for a lot of CPG folks, March, April and May schedules are brutally taken over by conferences and trade shows. Seems like Expo West was just a couple of weeks ago.
Well, the tariff refund portal officially opened in April, for importers only though. And Costco is already getting sued by the people who actually paid the bill. Exporter pays for the tariff, importer gets the refund, and the consumer gets screwed. Do I have that right? Meanwhile food-at-home inflation eased a bit, but the overwhelming majority of middle-income shoppers shrugged and said they expect prices to keep climbing anyway. Welcome to the perception-gap economy.
In other industry news, the U.S. House passed the 2026 Farm Bill, protecting retailers from EBT processing fees and expanding access to nutritious foods for program users. NACS reported c-store sales topped $341.2B in 2025, up 1.7% YoY and the 23rd straight year of growth, and Target's turnaround appears to be sticking, with Q1 store visits up 5.1% YoY following a horrendous 12 months and a $1B investment strategy.
The CPG landscape of the future is taking shape: next-gen private label is about to dominate, fresh is a major strategy driver for retailers, and investments in AI and in-store experience are becoming non-negotiables. Buckle up, buttercup.
The Private Label Glow Up
It's no surprise retailers continue to invest in private label. Over the last five years we've seen own brands dollar share in total U.S. go from roughly 20% in 2020 to roughly 24% in 2026. And as consumers face growing economic challenges and rising prices at the shelf, retailers are actively reinventing own brands, further distancing themselves from their once value-driven position into a next-gen growth driver.
Walmart is executing the most extensive private-brand overhaul in retail history, redesigning roughly 10,000 Great Value SKUs, a brand worth over $24B.
Across its 1,100+ member retailers, AWG recently launched Wellworks and Nuwerks, a pair of wellness-focused own brands targeting protein, gut-health, immunity and the supplements categories.
Save A Lot consolidated two legacy Hispanic own brands under the new La Tierra de Sabores brand and is adding new SKUs as part of a 2026 push to engage Hispanic shoppers across its discount footprint.
And Meijer launched 300+ new fiber and protein private label SKUs, leaning into growing GLP-1 driven health trends.
Over the past decade-plus, consumers have started to trust the quality of private brands more and more. And with this next wave of evolution, own brands are no longer the low-quality option competing on price alone. They're competing on brand, quality, function, and cultural relevance.
Inflation Relief? Not So Fast
Grocery inflation eased to 1.9% in March, the first sub-2% read since November 2025. But hold that celebration for now. The slight decline was largely driven by the drop in egg prices, while double-digit increases on beef and coffee, plus rising fuel and fertilizer costs from the war in Iran, point toward renewed pressure ahead.
In a recent update, Numerator explicitly named energy and shipping costs from the Iran conflict as the biggest risk to sustained grocery inflation cooling. If not solved soon, this will likely fuel a new wave of inflation.
The Price vs Perception Gap
The war on price continues to take shape across channels. Conventional grocers are leaning into targeted price cuts, digital-only deals, price-lock programs, and personalized loyalty rewards in ongoing efforts to narrow the value gap with Aldi and Walmart. Kroger is calling out cuts on items that matter, including beef, eggs and produce. ShopRite's LockedIn Price program guarantees thousands of staples for 4-6 weeks, while Stater Bros. and Giant Eagle are leaning into app-only deals.
Interestingly, a recent study by AlixPartners found that only 13% of conventional grocery shoppers believe their primary store has low prices. This indicates a challenge with consumer perception, and we are starting to see more of it. Whether it is the economy, price, experience, or being pretty good with money while DoorDashing a $35 breakfast burrito, consumer confidence and consumer reality are having two very different conversations right now.
The Remodel Era is Here
Across grocery and mass, it's not just price setting the competitive agenda. It's capital deployment.
Retailers are investing big time in physical assets to unlock growth that price wars can't reach: fresh, prepared foods, grab-and-go, and improving the overall shopper experience.
Last month, Walmart announced plans to remodel 650+ stores across four states, with refreshes featuring wider aisles, expanded pick-up and delivery, updated pharmacies, and added digital touch points.
Albertsons plans to invest heavily in new stores and an amplified remodel program. President and CFO Sharon McCollam shared in the Q4 earnings call that the company expects the store remodel number to be up 50% versus last year. That's potentially 150 stores.
It's not just the big players. Independents and regionals across the U.S. are investing big into fresh, prepared, and grab-and-go to differentiate, not price. Piggly Wiggly, Family Fare, and ShopRite are among many actively remodeling stores.
While price remains the number one driver, shoppers are increasingly choosing freshness, quality, convenience, and the overall experience. In the 2026 Progressive Grocer CES, product freshness ranked second in store selection at 67%, just behind price at 77%. In a separate 2025 Shopper Study, 63% of shoppers said being able to easily get around the store was their top consideration, with three quarters of those pointing toward easy-to-identify aisle and shelf signage, clear aisles, and fewer displays as important factors in their desired shopping experience.
And retailers know this. They aren't spending combined billions on remodels just to win a quarter. They're doing it to redefine what shoppers expect from a visit to their store.
And in theory, when the baseline shifts, every brand on shelf gets reevaluated against it. A cleaner, easier, and better-stocked store with more fresh options raises the bar for every brand and product inside it.
Bottom line, if high prices are the new norm, shoppers are telling retailers they want a better experience. They're saying they want trust, and to be taken care of.
And brands should probably take note, lean in, and find ways to work with these retailers to create an experience for their shoppers like no other.
The Albertsons Co.
Albertsons released their Q4 FY2025 results and all signs point toward an operationally stable but strategically pressured business. Balancing solid cash generation, momentum in the digital space, and loyalty growth against dampened top line growth, pharmacy headwinds, and rising scrutiny on pricing and execution, Albertsons is going all in on Merch United to take them to the Nationally Great, Locally Strong promised land.
Make or Break Year for Morris
The first year under new CEO Susan Morris and Albertsons is looking pretty healthy: digital sales up 21%, loyalty increased 12%, and digital penetration reaching double digits. The problem? Stock price is down roughly 25% since the transition and many are marking 2026 as Susan's make-or-break year.
The post-merger environment was undoubtedly a difficult landscape to navigate, with endless lawsuits, break-up fees, and juicy scandals. Juicy for CPG, that is. Yet the pressure mounts. Walmart, Costco, and Amazon have gotten stronger, creating even more pressure for Albertsons. Susan's call for a return to Boise has resulted in several departures and challenges filling critical roles, all stacked on a challenging economic environment with rising costs and increasing war-driven inflation.
How will Susan make her mark and set The Albertsons Companies on a path to profitable growth? The path is laid with investments in private label, store remodels, AI and tech priorities, and the successful execution of Merch United.
Merch United is the Future
Albertsons is leaning in big time on Merch United. At the WAFC Albertsons Townhall this last week, Chris Lanoue, Demetri Pantazes, Teresa Whitney and other merchandising leaders outlined the evolution from Winning Model to Merch United, and the key tactics taking shape.
With more than 200 merchants now aligned on shared priorities across the national and divisional teams, enabled by a longer 52-week promotional planning process, tighter collaboration between category and sales leadership, and tech-enabled coordination that blurs national and divisional lines, the goal for Merch United is to shift Albertsons away from 11 siloed divisions to a single, unified enterprise merchandising company.
Financial Headlines
Albertsons plans to invest $2B to $2.2B in FY26 capital expenditures, up from $1.84B in FY25, on roughly 15 new stores, a store remodel program, and AI-powered demand forecasting and pricing tools.
Albertsons' Board declared a 13% dividend increase to $0.17 per share and reset the share-repurchase authorization to $2B, a sign of confident cash generation.
Albertsons announced a $774M national opioid settlement with state and local governments, triggering a $600M after-tax charge and a roughly $481M net loss.
Washington State AG filed a lawsuit alleging Albertsons illegally raised prices before BOGO promotions and lowered them afterwards, costing Washington shoppers $19.7M from 2019 to 2024.
Looking forward
Outside of a few open roles, the pieces are in place for Albertsons to close the gap and accelerate into the year. Digital growth is real, loyalty is gaining traction, and Merch United represents the kind of structural shift that could move the needle on both efficiency and relevance. But the path to profitable growth runs directly through Albertsons' ability to retain talent, execute a $2B+ capital plan, and navigate a legal and regulatory environment that isn't getting quieter.
Kroger
The Great Kroger Reset of 2026 is underway and new CEO Greg Foran is wasting no time. Foran sent an internal message to employees last month signaling more change: if you've been on the desk longer than three years, you will be rotated or no longer at the company.
A bold but consistent message from the fundamental-first, back-to-the-basics Foran we've come to know. Putting their proverbial money where their mouth is, Kroger later announced a hiring freeze, a clear sign of an ongoing assessment of the organization's internal structure and needs for the future. Expect more change to come.
Kroger Divisions Want to Win
At their WAFC townhall, leaders from the western Kroger divisions said they want to win first with innovation, calling out to the vendor community to bring opportunities in their market to the table. Among other topics, they asked CPGs to help them simplify to become better operators together, a need to win the holidays with compelling offers and the right items, the importance of in-stocks to grow eCommerce, and the need to grow category in total.
Investment in the Frontline
Kroger launched Pearl Street Academy in April, a centralized career-development and training platform for Kroger employees. Paired with an existing tuition-reimbursement program, Pearl Street Academy adds leadership development, training courses, and growth-experience access in one platform aligned with the company's leadership goals.
Kroger's Fuel Empire Grows
Kroger has more than tripled its fuel center count over the last 20 years, now reaching 1,731 locations as of Jan. 31, as fuel rewards remain a core lever in the Boost loyalty program and a critical pricing and value defense against Walmart and discounters. CFO David Kennerley said fuel continues to be an important part of Kroger's strategy. With growing c-store trends, this adds up to be a huge competitive edge for Kroger.
Looking forward
Kroger's 2026 story is one of both organizational disruption and investment. Under new leadership, Kroger is shaking up the org while doubling down on frontline talent, fuel infrastructure, and eCommerce fundamentals. The bet is that short-term organizational turbulence is worth the long-term payoff of a leaner, better-aligned company. If the reset lands cleanly, Kroger emerges with a sharper team, a stickier loyalty ecosystem, and a fuel network that truly differentiates.
The Bottom Line
A lot moved in April. Tariff uncertainty crept into the courtroom. Inflation cooled on paper but the supply chain pressure underneath is heated up. Both Kroger and Albertsons leadership are executing significant organizational overhauls to try and move beyond the failed merger and win in a rapidly evolving CPG landscape. And capital expenditure commitments across the industry are at multi-year highs, targeting AI, store remodels, and an improved shopper experience.
The retailers coming out ahead in this newly forming CPG world will be the ones who are able to get lean and become better operators. They will be the retailers that can execute on remodels, on next-gen private label, and on driving loyalty. The ones who don't will cede ground to not just the Walmarts, Aldis, and Amazons, but to the regional players that understand how to win, and are investing big time to get there.
For anyone selling into grocery right now, the opportunity is real and the bar is rising. Retailers want partners who understand their priorities, show up prepared, and who can help them grow the category. This has always been the job. But right now, it matters more than ever.
Have a great week!
Cheers,
Taylor
RecorNews & AI
AI is cool - and don't get me wrong, I use it. To help summarize articles, provide additional context, and - more often than I would like to admit - ask what the internal temperature of cooked salmon is. 145 degrees, FYI.
But I do not use AI to write RecorNews.
Because that would be lame.
