When a trio of grocery store chains puts an end to a brutal five-month strike in California, it's logical to think that the worst is over. Kroger (NYSE:KR), Albertson's (NYSE:ABS), and Safeway (NYSE:SWY) all suffered significant declines in traffic as picketers and bad vibes kept folks away. In fact, it was a boon to alternatives like former Motley Fool Stock Advisor recommendation Whole Foods Market (NASDAQ:WFMI), many of which gained market share in the impacted areas.
But strike or no strike, everything isn't back to business as usual. In an ominous sign that the days of the traditional grocer may be numbered, Kroger announced that it would be closing 15 of its Ralphs supermarket locations in California.
You can't blame this entirely on the labor disputes. Wal-Mart's (NYSE:WMT) Supercenter stores continue to load up on grocery items, while warehouse clubs like Costco (NASDAQ:COST) and BJ's (NYSE:BJ) are offering compelling price savings at barebones markups.
Earlier this month, Kroger reported lower gross margins. That's telling and has nothing to do with the strike. A fall in comp-store sales may indicate that inventory isn't turning as quickly as it used to, and that will wreak havoc on already slim net profits. Reduced gross margins, however, imply that traditional grocers like Kroger have little choice but to keep the premiums honest to fend off their strengthening rivals.
Like blackened bananas or that five-year-old Twinkie, traditional supermarkets may be simply victims of expiration. You might say they're well stocked in rosemary but fresh out of thyme.
Do you prefer to shop at traditional grocery store chains or are you filling your cupboard elsewhere? What's the difference between rosemary and thyme? Know any way to work those seasonings into tonight's dinner? All this and more -- in the Recipes discussion board. Only on Fool.com.
Longtime Fool contributor Rick Munarriz enjoys food -- most of the thyme. How else do you think he became TMF Edible? He does not own shares in any company mentioned in this story.
