The Indiana-based Marsh grocery store chain filed for bankruptcy Thursday, triggering a process where it could be bought out, preserve more profitable locations, or close entirely.
The 44 remaining Marsh stores in Indiana and Ohio could close in 60 days if the company can’t find a solution. Marsh already closed 21 other low-earning locations and sold its pharmacy business this year.
Grocery stores only earn about 4 cents for every dollar spent, says Purdue University retail analyst Richard Feinberg, so any financial fluctuations have a big impact.
He says even profitable Marsh stores may not survive in an increasingly crowded market.
“The retail history says that it’s less likely to happen than just closing it down,” he says.
Marsh touts itself as the first grocery chain to use electronic scanning at checkout, and to send coupons to customers’ phones while they shop. But Feinberg says technology isn’t enough to sustain a grocery brand.
“There are loyal Marsh consumers who’ve been going to Marsh for 30 years, 40 years, and they don’t care about the new stuff – they just like Marsh,” he says. “But we old-timers are dying off, and the new, up-and-coming consumer is just not loyal anymore.”
With more options and changing consumer habits – millennials eat out more and cook less – Feinberg says grocery stores need to provide a unique experience. He cites the Wegmans chain and Ohio-based Jungle Jim’s as examples.
“And I know Marsh has put a lot of money into making their interior a little more beautiful, but not to the stage where people say, ‘Wow,’” Feinberg says.
But he says the loss of remaining Marsh stores will still be painful for those loyal consumers, employees and communities struggling to fill large, empty storefronts.
“There’s a lot of pain involved in a chain closing down, particularly one that has such a Hoosier history,” Feinberg says.
Still, he says Marsh’s demise may be self fulfilling. Other regional chains can already advertise that they’ll welcome Marsh customers, even before they’re displaced.