Randalls will close third store since April
Despite its struggles in a competitive market, grocery chain says it is still committed to the Houston region
R ANDALLS is closing its third Houston-area store this year as the longtime local grocer continues to struggle in a hyper-competitive market.
A brightly colored liquidation banner was recently stripped across the Randalls at Coles Crossing in suburban Cypress, and it will close in June. Last month, the company shuttered stores in Garden Oaks and Stafford, leasing those locations to a Hispanic grocery chain called El Rancho.
Despite the closures — which together will bring the chain’s local store count down to 26, half what it was in 2005 — a representative said Friday that Randalls remains committed to the region.
“Randalls is invested in the Houston-area market and remains focused on providing for our customers’ needs, no matter where, when or how they shop with us,” spokeswoman Dawne Proffitt said in an email.
The 67,334-square-foot Randalls supermarket in Cypress was one of the first to open in the northwest suburb back in 2001. But the
company has struggled in recent years to compete against regional and national competitors offering lower prices and a wider selection of goods. H-E-B has opened a store across BarkerCypress Road.
“Despite our best efforts, we have not been able to reposition this location to better compete in the marketplace,” Proffitt said.
Randalls sold its roughly 7acre Cypress property in May to Williamsburg Enterprises, a Houston-based real estate investment firm. Financial terms were not disclosed. CBRE Houston, a commercial real estate firm, brokered the deal.
Neither Williamsburg nor CBRE responded to requests for comment Friday.
About 60 employees will be affected by the latest store closure. Randalls is working with employees to find new positions at other locations, and will provide severance to eligible employees not placed, Proffitt said.
In addition to the Garden Oaks and Stafford closures in April, Randalls shuttered one of its Katy locations in early 2017. Later that year, it also consolidated its distribution operations in Dallas by shutting down and selling its Houston-area warehouse, a 700,644-square-foot facility on 70 acres in Cypress.
The grocer, locally based but now a subsidiary of Albertsons, has a less than 4 percent market share in the Houston area, according to the Shelby Report, a grocery industry research firm.
For comparison, H-E-B, Kroger and Walmart each command roughly a quarter of the local market.
“The competition in the supermarket arena is vicious,” Ed Wulfe, chairman and CEO of Houston commercial real estate firm Wulfe & Co., said. “H-E-B, Kroger and Walmart, they’re the 1,000-pound gorillas. It’s hard for Randalls to compete with these bigger stores.”
Randalls for decades was the No. 1 supermarket chain in Houston catering to the uppermiddle class. The company was active in the community, supporting various civic groups throughout the city, Wulfe said.
In 1991 Randalls had more than $1 billion in revenue, making it one of the fastest growing companies in Houston.
Safeway acquired Randalls in 1999. Boise, Idaho-based Albertsons acquired Safeway in 2015.
While ownership changed from local hands to national ones, new competitors entered the Houston market. Over time, Randalls was eclipsed by the likes of H-E-B, whose 100,000square-foot supermarkets dwarf Randalls’ 50,000-square-foot stores, Wulfe said.
It’s not for lack of trying. For instance, Randalls renovated the interior of its Cypress store several years ago to lure customers from an H-E-B that was built across the street.
Randalls also has expanded its e-commerce services, allowing customers to order online and have groceries delivered home via the Instacart app. The company is rolling out meal kits and curbside pickup service at select stores to attract patrons.
Several customers on Friday stopped by Randalls’ Cypress store, which displayed a sign: “Store Closing! Liquidation Sale!”
Some said they were running quick errands while others said they were looking for going-outof-business deals.
Michele Schwandt, 54, an addiction treatment consultant, bought some baked goods for her clients.
The Cypress resident said she has been shopping at the Randalls off and on since about 2002, and remembers when it was the only grocery store in the area.
“It’s sad because I like to support local businesses,” Schwandt said. “But Randalls is more expensive than H-E-B. They’re so big, Randalls can’t match them.”