Grocery Outlet Bargain Market, the California-based discount grocery chain renowned for its closeout deals, has unveiled plans to close 36 underperforming stores across the United States. This strategic move, announced by President and CEO Jason Potter, aims to address the chain's overly rapid expansion and adapt to changes in Supplemental Nutrition Assistance Program (SNAP) benefits that have impacted its core customer base.
Financial Pressures Drive Store Closures
The decision was disclosed during last week's earnings announcement, as Grocery Outlet seeks to bolster profitability following a disappointing fourth quarter. The company reported a net loss exceeding $218 million, despite overall sales continuing to rise. Potter attributed this financial strain to increased competition and delayed federally funded benefits, which placed additional pressure on shoppers during the critical holiday period.
East Coast Expansion Missteps
Approximately 24 of the closures are concentrated on the East Coast, where Grocery Outlet admitted it expanded too quickly. These closures represent about 6 percent of the chain's roughly 570 stores nationwide. The company's fiscal year typically ends on the Saturday closest to December 31, with most years comprising 52 weeks. However, 2025 was a 53-week year that concluded on January 3, 2026.
Optimization Plan and Future Growth
The closures are part of a broader optimization plan approved by Grocery Outlet's board, designed to shift resources and streamline operations. Potter emphasized that the company is not abandoning expansion entirely. In fact, Grocery Outlet plans to open 30 to 33 new stores in fiscal 2026, indicating a more measured approach to growth moving forward.
Enhanced Customer Focus
In response to the challenging market conditions, Grocery Outlet is intensifying efforts to improve value for customers and enhance the in-store experience. This includes restoring more opportunistic discount deals and continuing its store refresh program, which the company says is already yielding early positive results.
Affected Store Locations
While Grocery Outlet has not released an official public list of affected stores, local news reports indicate closures will span multiple states. The impacted locations include:
- Pennsylvania: 345 Scarlett Road, Kennett Square; 18993 Park Avenue, Meadville; 2017 West Oregon Avenue, Philadelphia; 2524 Welsh Road, Philadelphia
- Maryland: 1753 Chesaco Avenue, Baltimore; 6510 Baltimore National Pike, Suite A, Catonsville; 598 Cranbrook Road, Cockeysville; 5410 Lynx Lane, Columbia; 1713 Massey Boulevard, Hagerstown; 7660 Belair Road, Nottingham; 11120 Reisterstown Road, Owings Mills; 200 Clifton Boulevard, Westminster
- California: SW Corner of Citrus Ave and East Alosta Ave, Azusa; 315 Panno Drive, Brawley; 350 North Second Street, El Cajon; 14868 West Whitesbridge Avenue, Kerman; 2001 West Whittier Boulevard, La Habra; 4420 Ontario Mills Parkway, Ontario; 2900 Sperry Avenue, Patterson; 13345 Poway Road, Poway; 120 North China Lake Boulevard, Ridgecrest
- Idaho: 2455 East 25th Street, Idaho Falls; 1732 Hurley Drive, Pocatello; 20 Nearing Way, Smeltersville
- New Jersey: 4004 Route 130, Delran; 401 Harmony Road, Gibbstown; 3057 New Jersey 35, Hazlet; 190 Hamilton Commons Drive, Mays Landing; 3174 Route 9, Suite 5, Rio Grande; 677 Berlin Cross Keys Road, Sicklerville
- Ohio: 4844 Everhard Road, Canton; 650 Eastgate South Drive, Suite F, Cincinnati; 4415 Leavitt Road, Lorain; 876 Lexington-Springmill Road, Ontario; 5721 Broadview Road, Parma; 6000 Mahoning Avenue, Youngstown
Potter concluded by expressing confidence in the company's revised strategy, stating, "We are confident that we have identified the core challenges, and now have the right plans in place and the right team to execute them." The closures are expected to be completed by the end of the current fiscal year.
