Amazon, Walmart push Kroger to launch clothing brand

Shop for blouses and blueberries in the same trip.

Image: francis dean/corbis via getty images

Shoppers will soon be able to fill carts with yogurt and yoga pants at America’s largest supermarket chain.

Kroger said Friday that it’s launching its own clothing line at around 300 of its stores next fall. The brand will encompass basic items for children and adults with a particular focus on activewear.

“This new offering is on-trend, convenient, and right in line with our customers’ needs,” Kroger senior vice president of merchandising Robert Clark said in a statement.

While the grocer has long stocked third-party apparel at its Fred Meyer stores in the Pacific Northwest, the move will mark the first time it’s done so under its own name. At least for now, the new line is only slated to appear in those stores and its Walmart-like Marketplace locations rather than its straightforward supermarkets.

It might seem odd to add clothing racks near produce bins and bread aisles, but the decision comes at a desperate time for the grocery giant. It now faces formidable competition from a host of big retailers, Amazon and its newly acquired Whole Foods stores perhaps chief among them.

Big-box chains like Walmart and Target have also focused on building out their grocery businesses as a way to keep a reliable flow of store traffic at a time when people are doing an increasing amount of their other shopping on the web. Those habitual store visits are so valuable to these companies that they sometimes even sell the groceries at a loss.

Kroger has no such luxury for the most part. Supermarkets are slim-margin businesses that leave little room for the type of investment capital it needs to adapt its operations to a fast-changing industry. Adding products beyond groceries could help with that.

Meanwhile, Amazon has also been rolling out a stable of new private-label fashion lines, and Walmart has been buying up trendy clothing brands like Bonobos and ModCloth. Kroger may be looking to follow the same roadmap.

In any case, the company could definitely use a win right now. Its stock has dropped nearly 40 percent this year—shares plunged around 8 percent on the day Amazon announced its Whole Foods acquisition alone.

Escaping that slump could take more than grocery business as usual. 312c 2552%2fthumb%2f00001


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