‘The Basket Has to Come Down,’ Kroger CEO Says as Chain Plans Major Price Cuts to Compete With Walmart and Costco

Kroger, the largest traditional supermarket chain in the United States, is preparing its most significant round of price cuts in years. CEO Greg Foran told Bloomberg News the company is actively laying the groundwork to bring down prices across thousands of products, with plans to test reductions before rolling them out more broadly. It was his first public comments on strategy since taking the role in February.

The push comes as grocery shoppers grow increasingly cautious about their spending. Rising gas prices, persistent inflation, and broader economic uncertainty have pushed more consumers toward retailers known for low prices, and Kroger has felt the pressure. Competitors like Walmart, Costco, Aldi, and Amazon have steadily gained ground, drawing shoppers away from traditional supermarket chains.

Kroger operates 21 regional grocery chains, including Fred Meyer, Ralphs, Harris Teeter, King Soopers, and City Market, and generates nearly $150 billion in annual revenue. Despite its scale, the company has struggled to keep pace with rivals that have made affordability their defining feature. Foran’s arrival as the company’s first external CEO is widely seen as a deliberate reset.

How Kroger Plans to Fund the Price Cuts

Rather than seeking outside relief, Foran said the savings will come from within, through direct importing, leaner operations, and smarter use of technology, with the goal of moving those gains to the shelf. The approach allows the chain to cut prices without immediately sacrificing margins, though grocery retail already operates on thin profit margins compared to warehouse clubs and big-box retailers.

The scale Foran is describing goes beyond typical promotional discounts. ‘The reality is, the basket has to come down,’ he told Bloomberg, adding that reductions need to span thousands of products and make practical sense to customers. Rather than short-term deals, the company is moving toward a fundamental change in how it prices everyday items across its stores. 

For context on where the competitive bar sits, Walmart recently disclosed it had cut prices on roughly 7,200 items, a figure that has grown by more than a fifth compared to the prior year. Walmart CEO John Furner noted that low prices have continued helping the retailer gain market share across income levels. Foran, who previously led Walmart’s U.S. stores before departing in 2020, is now trying to apply a similar playbook at Kroger.

A Wider Turnaround Beyond Pricing

Price is only one piece of Foran’s strategy. Internally, the company has been working around a framework he calls the “Five Fs”: fresh, fast, affordable, friendly, and “for you.” The last element refers to Kroger’s ambition to personalize the shopping experience and better tailor individual store offerings to the communities they serve. Staff training is also part of the effort, aimed at improving service consistency across locations.

Foran used a Formula One analogy to describe where Kroger currently stands relative to its competitors, saying the chain needs to get out of the midfield and close the gap on the leaders. The analogy points to how much ground Kroger feels it needs to recover, and how much urgency Foran is attaching to the effort. His background at Walmart, where he was known for hands-on store visits and a focus on cleanliness, fresh food, and price, informs much of the current direction.

The company is also planning a significant expansion. Kroger expects to open between 70 and 80 new stores next year, roughly double the number opening in 2026, with growth targeted in high-population markets including Texas, Florida, and the Carolinas, as well as the Northeast, where Kroger’s presence remains limited. New locations are also expected to support the chain’s growing e-commerce and delivery operations.

Kroger’s Broader Context and What Comes Next

Kroger is navigating this moment after a turbulent stretch. Its proposed merger with Albertsons was blocked by regulators, and longtime CEO Rodney McMullen departed abruptly about a year ago. Foran stepped in, tasked with stabilizing the business while also making it more competitive in a grocery market that has moved considerably toward value-focused retail, with discount-oriented players continuing to set the pace.

Consumer behavior continues to complicate the picture. Shoppers are increasingly splitting trips between multiple stores, hunting for promotions, and trading down to store brands, patterns Foran said grocery chains are having to respond to. He acknowledged affordability concerns could deepen if economic pressures persist, particularly around fuel costs.

The road ahead is competitive. “Our objective is to execute what we think is a very clear, sensible plan. We want to be America’s best grocer,” Foran said. Whether the chain can close the gap with Walmart and Costco will depend on how quickly and consistently it brings prices down, while also improving the in-store experience enough to give shoppers a reason to stay.