SAN ANTONIO – Kroger is returning to the San Antonio market after nearly 30 years, but it won’t be your grandmother’s grocery store. The company is launching an online-based grocery delivery service and bringing 160 jobs and a lot of robots.
“Kroger today looks very different than it did in 1883 when we opened our first store,” said Rodney McMullen, Kroger’s chairman and CEO, said in a statement. “I’m incredibly excited for the future of Kroger, and both thriving physical stores and digital solutions are part of it.”
Instead of stores, you’ll see refrigerated trucks. It’s all part of a network with Dallas as a major hub and San Antonio as a spoke. A lease on a 67,000 square foot facility on the city’s Northeast Side is being finalized, according greater:SATX.
“We’re proud to welcome Kroger’s e-commerce-focused delivery model into San Antonio. The facility will be part of a high-tech network that serves the region and employs more than 160 people in our community,” said Tom Long, managing director for industrial with greater:SATX.
Shoppers will be able to place online orders and a the orchestrated automation will move product from the hub to the local facility to the trucks where people will make deliveries.
“It’s part of the future of grocery shopping and all shopping,” said Dr. Venky Shankar, director of research at the Center for Retail Studies at Texas A&M Mays Business School. “(It’s) not just Kroger, but all grocery stores have learned we need to be there for the customer whenever they want us to be.”
While the high-tech fulfillment model has been in the works for a few years, the pandemic underscored customer demands. That’s when grocers generally saw online orders increase from three to five percent of overall sales to up to 20 percent, according to Shankar.
Now, shoppers expect to be able to buy groceries any time, place or manner.
“We live in a world where this is a new normal,” Shankar said.
For the company, this type of model reduces costs of real estate, operating brick-and-mortar stores, and labor. For customers, it offers options and convenience.
Kroger’s new facility is expected to begin operations later this year.