Consolidation In Hispanic Grocery Store Business Continues

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The growing Hispanic population in the U.S. and their proclivity for home cooking is helping fuel consolidation among Hispanic grocers. The latest being Bodega Latina’s purchase of Fiesta Mart.Competition is only increasing among grocers. Amazon bought Whole Foods Market last year. German giant Aldi is expanding its push into the U.S. Albertson’s is buying up Rite Aid.

But Hispanic consumers are special to grocers. According to Nielsen, the country’s 55 million Hispanics outspend all other shoppers in 12 of 16 primary food and consumer categories. Simmons OneView’s National Hispanic Consumer Study cites that Hispanics are 372% more likely to shop at a Hispanic Grocery store than the general population ages 18 and up. Additionally, 83% of Hispanics enjoy eating traditional/Hispanic foods according to the same Simmons Study. That’s why they are a coveted grocery customer.

Analysts were not surprised at the purchase of Fiesta Mart which was founded in Houston in 1972. It has a strong footprint in its hometown and grew in Dallas after buying Carnival brand stores from the Minyard family in 2008.

Fiesta’s new owner — Bodega Latina — a subsidiary of Mexico-based Grupo Comercial Chedraui S.A.B. de CV, also operates the El Super grocery chain, according to The Wall Street Journal. The company will reportedly continue to operate as Fiesta Mart. That’s important because Hispanic grocery customers are “a very loyal group,” according to Bob Goldin, a grocery consultant quoted in the Journal article.

In a press release announcing the deal, company officials said the greater scale of the combined stores boosts efficiencies, increases purchasing power, and helps keep prices low.

This continues a wave of change in the U.S. Hispanic grocery sector including last year when Supervalu Inc. bought Associated Grocers of Florida and Unified Grocers Inc. Albertsons invested in Texas-based El Rancho Supermercado and Cardenas Markets and Mi Pueblo were consolidated.

This is all great news for packaged goods companies catering to the Hispanic market who can more easily spread across a broader footprint.

by Karla Fernandez Parker
Courtesy of mediapost

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