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German grocer Lidl to acquire 27 grocery stores

German discount grocer Lidl plans to acquire 27 Best Market stores in New York and New Jersey, signaling a push to breathe life back into its U.S. expansion.

New York-based Best Market is a family-owned business that opened its first store in 1994. The deal is expected to close within the next few months.

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“Best Market has played an enormously positive role in the area, and we look forward to working closely with Best Market employees to build on that success,” said Johannes Fieber, CEO of Lidl US, which currently operates some 50 U.S. stores. “We are excited to expand into many great communities on Long Island and across the New York City area and introduce more customers to our simple and efficient approach to grocery shopping.”

The German supermarket chain has dominated the European grocery industry in recent years, but its ambitious expansion in the United States has been anything but inspired, industry analysts say. The popular discount grocery chain rapidly opened stores last year along the East Coast, with its U.S. headquarters situated in Arlington, Va.

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The grocer had lofty plans to open stores in states outside of the East Coast, including Ohio and Texas. After submitting a land development application to build a store in Beavercreek, the chain halted the project just months later. Sandra Pereira, associate city planner for Beavercreek, said the grocer only had a contract and never owned the land.

Beavercreek isn’t the only city that the grocer abandoned. The chain stopped construction on some projects around the U.S. In December, it stopped construction on its second New Jersey store due to “budgetary constraints,” according to local media. The News Leader reported that Lidl was backing out of a planned store in Staunton, Va., because the company was no longer interested in building in smaller markets.

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Grocery industry expert Brittan Ladd says the slowed expansion has more to do with failed execution of strategy in the U.S. The chain was seen as an immediate contender with grocery giants like Kroger and Walmart before falling short. While Lidl has opened more than 50 stores in the U.S., it hasn’t been able to keep customers coming back, he said.

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