Fresh Market closing all its Texas stores
The Fresh Market says it will close all eight of its stores in the state, including its four in the Houston area
Less than three years after entering Houston, the chain is a casualty of the state’s cut-throat competition among grocers.
LESS than three years after entering Houston’s competitive grocer y market, The Fresh Market announced this week that it will close all eight of its Texas stores, including four in the Houston area.
The announcement came after what company officials said was an analysis of Fresh Market’s growth strategy and long-term finances. It said the May 18 closures would total 13 across Texas, Iowa, Kansas and Missouri.
In a statement, President and CEO Rick Anicetti called it “a difficult but necessary step with the end goal of producing a strong, more agile company.”
A spokesperson for the Greensboro, N.C.-based company declined to comment further.
Fresh Market’s smallscale model has worked in other parts of the country, but it may have misread the market, said Eric Lestin, senior vice president of retail real estate brokerage firm CBRE. Since the grocery business already operates with thin margins, any new grocer — large or small — must do big business to compete effectively with the likes of H-E-B, Kroger, Wal-Mart and others in such a fiercely competitive market.
“I think they were probably counting on the ‘ boutique’ aspect of popping in and getting a few things, being able to appeal to those as opposed to the once- or t wice-weekly l oad-upthe cart shoppers,” Lestin said. “My sense is there just
weren’t enough of those.”
Eligible employees will be offered separation packages or the chance to work at other stores, the company said.
Fresh Market’s locations in Texas totaled four in the Dallas-Fort Worth area and four in the Houston area. Visitors to Houston locations Tuesday afternoon said signs on the stores stated they were closed for employee meetings but would reopen Wednesday.
The grocery chain established its first Houstonarea location in the 2600 block of West Holcombe in July 2013, taking over the former homes of Rice Epicurean Market, eventually with five stores. Within a year, Fresh Market closed its store at Weslayan and Westheimer.
Houston’s rapid population increase during the past several years cranked up competition for grocery retailers, with many building in areas where they anticipate residential growth.
Fresh Market’s presence likely wasn’t large or long enough that its exit will create any ripples in the local grocery market. In Houston, Wal-Mart, Kroger and H-E-B control about 80 percent of the market, with everyone else fighting for a share of the rest, said Jason Baker, a principal with real estate brokerage firm Baker Katz.
“I think, if nothing else, it will be a lesson to other grocers considering coming into this market in the future,” Baker said. “It is unique. Just because you’re successful in Florida or somewhere else in the Southeast doesn’t mean you’ll be successful in Houston.”