The first thing to know about how retailers are structured is that each retailer takes a different approach. The second thing to know is that these segmentations can get complicated, fast. A retailer might have both divisions and banners as well as other segmentations!
But let’s not let that weigh us down. There are some key, foundational concepts that can help you break apart a retailer correctly, in the same way that the retailer examines their own data.
As retailers expand—whether by opening new stores or merging with other companies—they organize their operations into banners and divisions to streamline management and reporting.
In this post, we’ll break down the concepts of banners and divisions and explore how three major U.S. retailers—Walmart, Kroger, and Sprouts Farmers Market—structure their businesses and track their performance.
What Are Banners and Divisions?
- Banners: These are the different store brands under which a retailer operates. A company may own multiple banners to serve different customer demographics or regions.
- Divisions: Retailers may also divide operations based on geography, store format, or product focus, allowing for tailored pricing, supply chain strategies, and marketing efforts.
Retailer Structures: Walmart, Kroger, and Sprouts
- Walmart: A Global Retail Powerhouse
Unlike Kroger or Albertson’s, Walmart primarily operates under a unified banner, simply known as “Walmart.” This consistency allows for strong brand recognition and streamlined operations. However, Walmart does have divisions based on store format and region.
Key Walmart store formats include:
- Walmart – Also known as Division 1 stores, these locations offer some groceries, as well as other types of goods. Smaller than the Supercenters.
- Walmart Supercenters – Massive stores with a wider selection of groceries, apparel, electronics, automotive and home goods. These stores can be as large as 200,000 square feet.
- Walmart Neighborhood Markets – Smaller stores focused on groceries and pharmacy services. These are usually around 40,000 square feet.
- Sam’s Club – Gotcha! Not actually part of Walmart’s structure. A separate membership-based warehouse chain.
Sometimes brands will launch first in Neighborhood Markets, or roll out to Supercenters, then back to the other divisions of the chain. Also note that Walmart also structures its business geographically into East, North, Southeast, Southwest and Western divisions. These regional divisions can also affect how a product is launched or distributed.
- Kroger: A Multi-Banner Grocery Giant
Kroger, one of the largest grocery retailers in the U.S., operates under multiple banners due to acquisitions of regional supermarket chains. Some of its key banners include:
- Kroger (the flagship banner)
- Ralphs (West Coast)
- Harris Teeter (Southeastern U.S.)
- Fred Meyer (Pacific Northwest)
Each banner has unique branding and regional strategies, but all benefit from Kroger’s centralized supply chain and data systems. When you go grocery shopping on your skiing trip, your Smith’s loyalty card from Albuquerque, New Mexico will work in a City Market in Breckenridge, Colorado.
- Sprouts Farmers Market: A Niche Natural Grocery Chain
Unlike Walmart and Kroger, Sprouts Farmers Market operates under a single banner. Sprouts’ structure emphasizes a unique and regionally sourced assortment rather than multiple banners.
While Sprouts stretches from California to Florida, brands don’t always have to launch in all stores nationwide. Regionalized rollouts give emerging brands an opportunity to build an audience and steady their velocity numbers in order to build the volume needed to distribute to other distribution centers, which then makes a national rollout easier to execute.
Why Does Retail Structure Matter for CPG Analysts?
For CPG analysts, understanding retailer structures is crucial for:
✔ Sales Performance Tracking – Identifying which banners, store formats, and regions are driving growth
✔ Regional Market Analysis – Understanding how consumer preferences vary by location
✔ Tailored Launches – Aligning brands to divisions or banners that reflect the customer base; for example, a premium brand might launch in a retailer’s higher-end stores or banners first as a test.
As retailers grow and evolve, analyzing their structures helps businesses make data-driven decisions, refine marketing strategies, and optimize supply chain logistics. Whether dealing with a massive retailer like Walmart, a multi-banner grocery chain like Kroger, or a specialized and differentiated retailer like Sprouts, understanding these borders and boundaries is essential for success.