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Why a discount grocer is closing stores in this economy

March 27, 2026

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  Closures are a reset, not a retreat: Grocery Outlet is cutting weak stores while still expanding elsewhere.
  
• 
  Even discount stores face price pressure: Competition from Walmart, Costco, and grocery promos is forcing everyone to sharpen pricing.
  
• 
  Shoppers who stay flexible win: Split trips, compare unit prices, and only stock up on what youll actually use.
  

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A wave of store closures is hitting Grocery Outlet, including nine locations across California, as part of a broader plan to shut down 36 underperforming stores nationwide.

At first glance, that feels backwards in todays economy.

When shoppers are stretched thin and actively looking for deals, youd expect discount grocers to be thriving. However, the reality is more complicated than that, and it actually says a lot about how grocery shopping is changing right now.

Heres how the 36 store closures break down by state:

• California Nine stores
• Maryland Eight stores
• New Jersey Six stores
• Ohio Sixstores
• Pennsylvania Four stores
• Idaho Threestores

Why a discount store would close in a 'save money'economy

According to the company, the closures are about cutting weaker locations and focusing on long-term growth. They still plan to open 30+ new stores in 2026, so this isnt a retreat, but more of a reset.

Heres whats really happening behind the scenes:

• Competition is getting more aggressive: Traditional grocery stores are running deeper promotions, and big-box retailers like Walmart and Costco are leaning hard into the perception of low prices across all categories.
• Shoppers are more strategic than ever: People arent just going to one store anymore; theyre splitting trips across multiple stores to chase the best deals.
• Value expectations are higher: Even discount chains have to constantly prove theyre the cheapest option, not just the budget option.

Translation: Being labeled a discount store isnt enough anymore. They have to consistently win on price.

Why this matters for shoppers

Store closures dont mean deals are disappearing. If anything, they signal that price competition is heating up.

Thats good news for shoppers, especially if you know how to take advantage of it.

Here are some smart grocery-saving tips to use right now:

1. Stop relying on just one store.

As mentioned earlier, the biggest shift happening right now is the move away from one-store shopping.

Try to use a mix of:

• Discount grocers (like Grocery Outlet)
• Warehouse clubs
• Traditional supermarkets for sales/coupons

This is how smart shoppers are cutting 2030% off grocery bills.

2. Treat discount stores like a treasure hunt.

Grocery Outlet is known for opportunistic inventory, meaning deals change constantly and products rotate in and out all the time.

So, the secret here is to not go in with a rigid list. Instead, go in looking for whats cheapest right now and be willing to try new brands and products.

Thats how you consistently find the real bargains.

3. Compare price per unit, not just shelf price.

A discount item isnt always cheaper. Take a close look at the weight of the box or package, as sometimes its filled with mostly air.

Get in the habit of always checking the following:

• Price per ounce
• Price per item

Sometimes Walmart or a sale at a traditional grocery store still wins on price.

4. Watch for clearance-style grocery deals.

As stores close or reset inventory, you may see:

• Deeper markdowns
• Bulk discounts
• Short-term price drops

This is a good time to stock up on shelf-stable items or things you can freeze for later use.

5. Dont confuse cheap with smart.

Buying something just because its discounted, or seems like a good deal, can backfire.

I actually made this mistake recently at Grocery Outlet. My local store had an 18-count box of protein bars for just $2.99. It was a brand I was familiar with, and the regular price was $24.99 for a box.

In my excitement, I grabbed four boxes only to realize later that the expiration date was just two weeks away. There was no way I could eat 72 bars by then. I ended up giving some away, but I will probably be stuck with a couple dozen stale bars that will end up in the trash.

Only stock up on:

• Items you already use.
• Products with a long shelf life.

Its pretty easy for your savings to turn into waste if you throw stuff in your cart just because the deal seems too good to pass up.