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Publix retains iron grip on No. 1 spot in Florida's competitive grocery business

Publix said in the third quarter its sales, compared to a year ago, rose 6.3 percent, its earnings climbed 7.3 percent and the company is on track to break its 2014 record of more than $30 billion in revenues. [Times (2014)]
Publix said in the third quarter its sales, compared to a year ago, rose 6.3 percent, its earnings climbed 7.3 percent and the company is on track to break its 2014 record of more than $30 billion in revenues. [Times (2014)]
Published Nov. 3, 2015

They are selling groceries at a dazzling pace in an ultracompetitive industry. Just don't tell Publix.

The Lakeland-based supermarket chain, which already controls 43 percent of the retail grocery market share in Florida, reported strong earnings Monday that reinforce the company's stranglehold on selling food to Floridians. Publix in the third quarter said its sales, compared to a year ago, rose 6.3 percent, its earnings climbed 7.3 percent and the company is on track to break last year's record of more than $30 billion in annual revenues.

Florida's top grocer may not be the sexy tech company of the future, but the company remains a standout in the state and an industry icon for consistently strong growth. Competitors seem unlikely to challenge it any time soon. Giant Walmart trails Publix at No. 2 in Florida grocery share with 29 percent. Combined, Publix and Walmart control 72 cents of every retail $1 spent on groceries in the Sunshine State.

That leaves plenty of other grocery chains scrambling for what's left. Winn-Dixie, squeezed by higher service by Publix and Walmart's low prices, recently announced it will invest $40 million to implement its "New Regular Pricing Program" by introducing price cuts as much as 53 percent on some 1,500 items that many Winn-Dixie customers purchase regularly.

That may squeeze profit margins at Winn-Dixie, which is owned by Southeastern Grocers. But will it slow Publix's momentum? The Publix chain runs just over 1,100 stores in Florida and five other southeastern states. So far this year, it has opened 12 new stores, closed four and remodeled 121.

Publix reported same-store sales (sales by stores open at least a year) for the first nine months of 2015 increased 4.5 percent compared to a year ago. They were up 4.2 percent for the latest quarter, a gain one grocery expert called "almost unheard of" in the supermarket industry.

"They are doing great compared to most supermarket companies — in fact just about all of them," veteran industry consultant David Livingston of DJL Research in Milwaukee told the Lakeland Ledger. "You won't ever see results like that from Winn-Dixie."

Other chains are trying. Expansion plans by a growing number of grocer players are under way, including Aldi, Trader Joe's, Costco, Sam's Club, Whole Foods, Fresh Market, Sav-A-Lot and BJ's. Germany chains Aldi and one we have yet to see in Florida — Lidl, coming to this country by 2018 — both claim plans to grow aggressively in this country. Industry rumors arise from time to time that other big U.S. chains, including Kroger, might eventually buy their way into the Florida market.

And it would be a grave mistake to forget Amazon, which seems obsessed to deliver any and all things to consumers as quickly as possible. Including groceries.

Contact Robert Trigaux at rtrigaux@tampabay.com. Follow @venturetampabay.

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