Kroger Slips to No. 3. Here’s What It Means for Suppliers.

For as long as most of us have been calling on Kroger, the pecking order in grocery has been simple. Walmart first, Kroger second, everybody else chasing. That changed this week.

Numerator's latest quarterly Retailer Market Share update shows Costco now capturing 8.4% of U.S. food and beverage spending, edging past Kroger at 8.2%. By share of shopper spending, Costco is now the country's second largest grocery retailer, and Kroger slides to third.

Two tenths of a point does not sound like much. But in a market this size, it is a headline Kroger did not want, landing just eight days after Investor Day. And for suppliers, it explains a lot about the conversations you are about to have with your Category Managers.

The Scoreboard

Here is how the top five stack up in food and beverage share, per Numerator's latest 12 month read:

On the broader CPG picture, which adds household, personal care and other packaged goods, Kroger sits further back at 6.7%. Costco leads that race for second at 8.2%, with Amazon and Whole Foods combined right behind at 8.1% after posting the biggest share gain of any major retailer.

This Was a Slow Leak, Not a Blowout

Nobody should read this as Kroger suddenly falling apart. The trend has been building for years. Numerator had Kroger at 9.1% of grocery spending in 2023, 8.9% in 2024, 8.5% in 2025, and 8.3% as of mid 2026. Over the same stretch, Costco climbed from 7.6% to 8.4%, with most of its recent gains coming out West.

Two lines moving in opposite directions for three years eventually cross. This quarter, they did.

If you have sat across from a Kroger Category Manager at any point in the last three years, you have heard the ask: show us how your item grows share, not just sales. That push lines up almost exactly with this slide. Kroger has been watching its share leak for years, and it has been asking suppliers to help plug it. Now you can see the scoreboard they have been looking at the whole time.

A quick note on what this measures. Numerator tracks share of consumer spending through its shopper panel. It is not Kroger's reported revenue, and it does not change the fact that Kroger runs roughly 2,700 stores across 22 divisions. What it does tell you is where shoppers are choosing to spend their grocery dollars, and right now, more of them are choosing a warehouse club.

Why Costco Is Winning

It is worth being honest about what Costco does well, because Kroger leadership certainly is. Costco wins on a few simple things:

• Perceived value. Shoppers walk out believing they got a good deal, whether or not they ran the unit price math.
• A tight assortment. Fewer items, chosen on purpose, with no clutter and no me-too duplicates fighting for the same shopper.
• A trusted private label. Kirkland Signature is a reason to visit on its own.
• Simple pricing. No loyalty math, no digital coupon clipping, no wondering whether the shelf tag is right.

Now read that list again and compare it to what Kroger announced on October 20.

Investor Day Suddenly Makes a Lot More Sense

If you wondered why Investor Day leaned so hard on value, this is the why. Kroger's plan to win back ground lines up almost point for point with the Costco playbook:

• $5 billion in customer value through 2029, including lower prices and simpler promotions.
• Roughly 1,000 new Our Brands items over three years, with Private Selection targeted to become a $5 billion brand.
• 110 new Fresh format stores by 2029, with more space for fresh, meals and private label, and less for general merchandise.
• About 100 new ready meals over the next year, chasing food away from home dollars.

Value, simplicity, private label, a sharper store. Sound familiar? Kroger is not copying Costco's format, but it is clearly competing for the same shopper instinct.

The Giant Eagle Wildcard

There is a real chance Kroger gets the No. 2 spot back without winning a single new shopper. Back in July, Numerator estimated the pending Giant Eagle acquisition would lift Kroger's grocery share by about four tenths of a point, enough to move it back ahead of Costco.

That is a fair point, and Kroger will likely make it. But buying share and earning share are two different things, and Category Managers know it. The underlying trend is what leadership is trying to fix, and the underlying trend is what will shape your next category review.

What This Means for Suppliers

When a retailer loses share, every item on the shelf gets asked the same question: are you helping us win shoppers back, or are you just taking up space? Here is how to be on the right side of that question.

Prove you bring trips, not just sales. Kroger does not need items that move dollars from one shelf to another. It needs items that bring a shopper in the door or keep them from leaving for a warehouse club. Lead with 84.51 data on penetration, repeat and new households. If your item has loyal shoppers who would walk if it disappeared, say so with numbers.

Make your promos simple. Kroger said out loud that promotions became overly complicated. Plans with layered offers, odd price points and three moving parts are going to get harder to sell. A clean price a shopper understands at a glance is the direction of travel.

Know your private label exposure. A thousand new Our Brands items need shelf space and DC slots from somewhere. If a store brand can do what your item does at a lower price, you need a clear answer for why yours deserves the facing.

Watch the West. Costco's biggest gains came in western markets. If your brand is distributed in Kroger's western divisions, expect those teams to feel the most pressure, and plan accordingly. Not all 22 divisions are fighting the same fight.

Bring solutions, not just asks. Every Category Manager is carrying this headline into their week. The supplier who walks in with a value story, a simpler promo plan and a reason shoppers choose Kroger is going to get a very different meeting than the one asking for a cost increase.

Losing a ranking stings, and Kroger will be motivated to win it back. Motivated retailers make fast decisions. Suppliers who show up ready to help will find a partner looking for exactly that. Suppliers who show up with business as usual may find the shelf has less patience than it used to.

For more on the plan behind the response, see our Investor Day coverage: Kroger's Investor Day recap and the $5 billion question, who's paying?

Sources: Numerator Retailer Market Share update via Supermarket News and Perishable News (Oct 28, 2026); Numerator historical share via Store Brands and Grocery Dive; Kroger 2026 Investor Day coverage via Grocery Dive, FoodNavigator and Retail Brew.

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From Cincinnati CPG Edge, keeping you in the Kroger know.