[EXCLUSIVE] Sprouts Set to Shutter Sandy Springs Store

Phoenix, Arizona-based Sprouts Farmers Market (NASDAQ:SFM), which entered the Atlanta market in 2014, announced March 2 it plans to close a total of 11 stores by mid-year.  The company did not reveal the stores slated for closure, only saying that they would include those in California, Florida, Georgia, Texas and Washington.  

ToNeTo Atlanta reported March 8 that the Sprouts in Duluth was one of the 11 stores slated for closure.  We have now confirmed with local sources that the Sprouts located at 4600 Roswell Road is also closing at the end of April.  

The store opened September 2, 2015 and anchored the Gateway Sandy Springs shopping along Roswell Road at Windsor Parkway near Chastain Park in Sandy Springs. The Sprouts closure comes at an unfortunate time as the center in which it's located was purchased last February with its new owners having recently invested in upgrades and just days ago rechristened the center "Chastain Market."   

According to an employee at the Sandy Springs store, a "closing sale" has yet to start, but the store is expected to close for good by the end of April.  The closure, which sources indicate is due to disappointing sales, is likely also related to the grocer's efforts to "right size" their store fleet and operate smaller stores.  The Sandy Springs store and its roughly 26,000 square feet are on the upper end of the size of store that the company operates locally.     During an earnings call earlier this month, Sprouts CEO Jack Sinclair and CFO Chip Molloy explained that the closing stores were opened by "the previous leadership team" and are approximately 30% larger than the current prototype and are generating negative cash flow.  

The company does plan to open new stores but they will be smaller.  “We are expanding with our new 23,000-square-foot store and every store opened this year will be in our new format,” Sinclair said during a March 2 call with investors and analysts. “We’re excited about our robust pipeline of more than 80 approved stores and nearly 60 executed leases. We have already opened four new stores in this first quarter with a plan to open at least 30 stores this year, and we are on track to reach our 10%-unit growth starting in 2024."   

Sprouts in late 2018 closed their store in Dunwoody which was in turn taken over by Lidl which suffered a similar and faster fate, having closed their store this past February.  

Following the closures of the Duluth and Sandy Springs stores, Sprouts will operate sixteen stores across Georgia including fourteen in greater metro Atlanta.  Metro Atlanta stores include those in Snellville, Tucker, Piedmont Heights, Johns Creek, Peachtree Corners and East Cobb while further out stores include those in Cumming, Woodstock, Peachtree City and Augusta, among others.   

The grocery's most recent Atlanta area stores debuted in 2021 in Smyrna and Buford and are about 19,000 and 23,000 square feet respectively.    

Are you surprised that Sprouts is closing in Sandy Springs?  Where do you do most of your grocery shopping?  What would you like to see open in place of Sprouts in Sandy Springs?      

Please share your thoughts below.