Why Publix Feels “Overpriced” — and Who’s Eating Its Lunch

 

By the Grocerant Guru® (Steven Johnson) — a data-first look at where Publix stands in 2025 and how grocerants and restaurant chains are stealing grocery share in Florida.

Publix is one of retail grocery’s most beloved brands — friendly cashiers, clean stores, and that famously addictive deli sub. It’s also one of the largest U.S. supermarket chains: retail sales hit roughly $59.7 billion in 2024 and the company remains employee-owned and tightly focused on the Southeast.

But affection doesn’t insulate a brand from shifting shopper priorities. Over the last 18–30 months a consistent set of trends have combined to push some shoppers away from Publix and toward value-focused grocers and meal-oriented restaurant chains. Below I lay out the data, the drivers, and three Florida restaurant chains that are nibbling at grocery’s “share of stomach.” Then — from my Grocerant Guru chair — three clear moves Publix should make to re-win everyday grocery occasions.

 

The perception problem: “Publix is overpriced” (and why that matters)

Perception matters as much as sticker-price. Local market studies and coverage in 2024–25 show Publix’s dominance in Florida markets — in some metros it controls roughly ~40–46% of grocery spend — which gives it pricing power but also makes price comparisons stark for value-seeking shoppers.

At the same time, industry analysts have flagged that Publix’s net margins and premium positioning leave it exposed when consumers prioritize low price and convenience. Reporters and consumer threads have pointed to item-by-item comparisons (eg. milk, eggs, staples) where discount chains undercut traditional supermarkets — feeding a narrative that Publix feels “expensive.”

Why perception matters: when shoppers are tightening budgets or simply become more value-driven, they move occasional trips to stores that deliver the lowest basket price or the fastest ready-to-eat option. That behavioral shift chips away at “top-of-mind” for everyday grocery runs even if the brand is beloved.

 

Macro shopping shifts helping Aldi, Lidl and other value players

Across the industry the story is consistent: value-oriented discounters have been growing share and recruiting new shoppers by combining low everyday prices, private-label penetration and streamlined stores. Aldi’s own 2025 pricing/expansion narrative claims millions of net-new shoppers in recent years thanks to that model. Independent industry trend reports also show “value shopping” and private-label adoption as two of the top structural forces shaping grocery in 2025.

Key shopper moves that favor discounters:

·       More price-sensitivity and active price comparisons (post-inflation behaviors).

·       Increased private-label acceptance as shoppers chase value.

·       Faster conversion of occasional trips (pluck-and-go) away from full-service grocers when meal-inspiration or ready-prep is not required.

Put simply: Aldi et al. win the “everyday basket” and Publix risks being seen as the store you visit when you want something special (deli, BOGO specials, service), not when you want cheapest staples.

 

Publix may have over-extended “reach” without staying top-of-mind for everyday trips

Expansion and store growth can create market coverage — but it doesn’t guarantee frequent mental recall for the most price-sensitive occasions. In many Florida markets Publix’s market share is dominant; yet that dominance can mask gaps in perception for value shoppers and for younger consumers who prize convenience and low price above in-store service. Media coverage and analyst commentary in 2024–25 point to exactly that tension: strong results and margins, but growing shopper movement toward lower-cost alternatives.

 

Three Florida-based (or Florida-strong) restaurant chains winning grocery occasions

Restaurants have learned to compete with grocery not just by dining room sales but by owning ready-to-eat and heat-and-eat occasions — those exact moments when consumers otherwise might cook or buy from the supermarket deli. Here are three chains that have, in my view, taken meaningful share from grocery shoppers in Florida:

1) First Watch — the daytime dining/ready-meal winner

First Watch is a Florida-founded chain that has grown aggressively in recent years and leaned into high-frequency daytime occasions: breakfast, brunch and lunch. Its made-to-order positioning, strong digital ordering and takeout volumes mean customers pick First Watch for convenient, fresher-than-grocery morning and midday meals. The company’s systemwide sales and expansion (500+ locations and growth into new states) show diners are choosing prepared restaurant meals in place of grocery-cooked breakfasts and deli lunches.

2) Pollo Tropical — Caribbean quick-service that sells meal convenience

Pollo Tropical (Miami-rooted and long-embedded in Florida food culture) has driven comparable-sales growth through compelling, heat-and-eat friendly menu items — home-style sides, protein-forward plates and family meals that are easy alternatives to a grocery run and home cooking. The brand’s recent revenue momentum and strategic positioning make it a ready meal alternative for shoppers who want ethnic flavors and no prep.

3) Chick-fil-A — convenience, speed and chicken that displaces grocery protein occasions

Chick-fil-A’s enormous systemwide sales and relentless traffic growth show how a focused menu (high-quality chicken, efficient service, strong drive-thru) can displace quick protein pick-ups that consumers might previously have filled with supermarket rotisserie chicken or ready salads. When a shopper can buy a protein + side in 5–10 minutes, that’s a direct competitor to the grocery deli or prepared-meal aisle.

Across these three examples the common thread is simple: speed, single-minded menu value, and consistent perceived value beat grocery for many everyday meal occasions.

 

What the data implies for Publix’s “grocerant” strategy

Industry trend reports for 2025 show three top forces: value shopping, growth of prepared/meal solutions, and brand trust/purpose as tiebreakers. Shoppers want low price when budget-conscious — and they want fast, delicious, prepared meals when pressed for time. Publix sits in the middle: premium service plus prepared offerings — but the brand must sharpen the edges of both to stop bleeding occasions to discounters and restaurants.

 

Grocerant Guru® prescriptions: how Publix should evolve — now

1.       Double-down on “value private kits” — curated meal kits under a strong private-label name
Launch a clear, everyday-value private-label meal kit line (breakfast bowls, dinner-for-two, family heat-and-eat trays) priced competitively vs. Aldi/TJ/discount staples. Position these as “Publix-assembled, chef-approved” and available at multiple price tiers (value / mid / premium). This addresses price perception AND the need for ready meals.

2.       Operate microsites of grocerant within stores — heat-and-eat hot bars + branded meal stations
Turn a section of every store into a visible grocerant hub: hot-case heat-and-eat proteins, rapid-heat microwavable kits with clear nutrition and prep time labels, and a small branded seating or pick-up zone for to-go customers. Promote these through targeted local marketing so “today’s lunch” mental recall shifts back to Publix when consumers think “quick meal.” (The restaurant chains winning share do this extraordinarily well.)

3.       Fix top-of-mind with transparent, frequent price/value messaging + loyalty nudges
Create a simple, repeated value message: a weekly “Essentials at $X” campaign that compares a Publix value basket to competitors — but do it in a proud, non-defensive voice. Pair this with loyalty offers that boost repeat visits for prepared-meal occasions (eg. buy 3 heat-and-eat meals, get one free) and with digital push notifications at peak meal times.

 

Think About This

Publix is not broken — far from it. It has service DNA, high margins and massive Florida market share. But the grocery battlefield in 2025 is defined by value perception and prepared-meal convenience. Aldi and other discounters are grabbing everyday baskets; fast-casual and quick-serve chains are winning meal occasions. For Publix to keep (and grow) “share of stomach,” it needs to be both the place you visit for a premium deli sub and the go-to for fast, affordable heat-and-eat solutions — visible, competitively priced, and aggressively marketed.

Are you trapped doing what you have always done and doing it the same way?  Interested in learning how www.FoodserviceSolutions.us can edify your retail food brand while creating a platform for consumer convenient meal participation, differentiation and individualization?  Email us at: Steve@FoodserviceSolutions.us or visit:  www.FoodserviceSolutions.us for more information.