FRANKFORT, Ky. (May 30, 2023) – Today, Gov. Andy Beshear highlighted the continued momentum of the state’s logistics and distribution sector as Kroger Fulfillment Network, a wholly owned subsidiary of The Kroger Co., will locate a new distribution center, also known as a spoke or cross-docking facility, in Boone County, investing over $550,000 and creating 98 full-time, Kentucky jobs.
“Kentucky’s unique location and access to resources make our distribution and logistics sector one of the strongest in the country,” said Gov. Beshear. “We are continuing to see announcements in this sector that are bringing incredible opportunities and jobs to our communities across the state. I want to thank Kroger and their leadership for expanding their operations in Kentucky yet again and continuing to believe in what this state has to offer.”
The new spoke facility will help expand Kroger’s e-commerce reach in Kentucky. This new facility will support the customer fulfillment center currently operating in Monroe, Ohio, by extending customers’ access to affordable, healthy and fresh foods. To support the operation, the company will locate the facility in a 2,000-square-foot portion of an existing building in Boone County and will create 98 quality jobs for Kentucky residents.
“We are thrilled to have our Northern Kentucky spoke facility considered for the Kentucky Business Investment program (KBI) and extend our deepest gratitude to the KEDFA staff for their support. The KBI underscores Kentucky’s pro-business climate and will allow for workforce growth and development in the Northern Kentucky area,” said Ben Hamilton, vice president of Logistics and Network Strategy, Kroger Delivery. “We are passionate about delivering a fresh, convenient customer shopping experience. This expansion will mean lower prices and more choices for more people across Kentucky. Just like their in-store experience, customers will have access to personalized digital coupons, valuable fuel points, and the fresh, high-quality products they need, want and love.”
Kroger maintains 112 stores in Kentucky, employing more than 19,000 associates. The commonwealth is also home to four manufacturing and distribution facilities that service the company, as well as a regional headquarters in Louisville. Since 1987, Kroger’s floral designers have created the famous Kentucky Derby Garland of Roses. In 2017, Kroger and the University of Kentucky entered a 12-year marketing agreement that renamed the university’s football stadium to Kroger Field.
This expansion adds to Kentucky’s thriving distribution and logistics sector, which includes more than 600 facilities and employs over 91,000 people statewide. Administration-to-date, more than 120 new-location and expansion projects within the industry are expected to create more than 8,000 full-time jobs with over $2.2 billion in new investments.
Boone County Judge/Executive Gary Moore thanked Kroger for adding new jobs in Boone County: “Kroger is an important and valued community partner and long-time employer here in Boone County. We’re grateful for the additional job creation that will help improve the efficiency of home deliveries to customers in Northern Kentucky and throughout the Cincinnati region.”
BE NKY Growth Partnership CEO Lee Crume noted Kroger is a major employer in the region: “We applaud Kroger on the expansion of its facility to increase its e-commerce grocery delivery capabilities and provide customers throughout Cincinnati and Northern Kentucky with access to affordable and healthy foods. We are happy to retain the current facility and win this expansion for the community.”
Kroger’s investment and planned job creation furthers recent economic momentum in the commonwealth, as the state builds back stronger from the effects of the pandemic.
Since the beginning of his administration, Gov. Beshear has announced the creation of 46,300 full-time jobs and nearly 860 private-sector new-location and expansion projects totaling $26 billion in announced investments.
The Governor has now secured the best two-year period in state history for economic growth.
In 2021, the commonwealth shattered every economic development record in the books. Private-sector new-location and expansion announcements included a record $11.2 billion in total planned investment and commitments to create a record 18,000-plus full-time jobs across the coming years.
That momentum continued strongly into 2022 with 248 new-location and expansion announcements totaling 16,000 full-time jobs behind nearly $10.5 billion in new investment.
The robust job creation has been accompanied by rising wages across the commonwealth. The average incentivized hourly wage in 2022 was $26.78 before benefits, the second-highest mark since 2010 and an 11.5% increase over the previous year.
Gov. Beshear also announced the two largest economic development projects in state history. In September 2021, Gov. Beshear and leaders from Ford Motor Co. and SK Innovation celebrated a transformative $5.8 billion investment that will create 5,000 jobs in Hardin County. And in April 2022, the Governor was joined by leadership at Envision AESC to announce a $2 billion investment that will create 2,000 jobs in Warren County. These announcements solidify Kentucky as the EV battery production capital of the United States.
Kentucky’s success has been noted by both S&P Global Ratings and Fitch Ratings, which have upgraded the state’s financial outlook to positive in recognition of the commonwealth’s surging economy. On May 12, Gov. Beshear announced that his administration secured the first state-level credit rating upgrade in 13 years and the first-ever such upgrade from Fitch Ratings.
Site Selection magazine recently placed Kentucky first in the South Central region and top-5 nationally in its 2023 Prosperity Cup ranking, which recognizes state-level economic development agencies for their success in landing capital investment projects. The publication also placed Kentucky second nationwide and first in the South Central region for its annual Governor’s Cup ranking for 2022, which recognizes state-level economic success based on capital investments.
Gov. Beshear’s administration is projected to post the four highest years of budget surpluses in Kentucky history, and the state’s rainy day fund has a record balance of $2.7 billion.
Gov. Beshear recently announced a new “Supply Kentucky” initiative with the goal of boosting job growth, reducing costs and providing more security in the supply chains of our Kentucky companies.
The Governor also recently announced that Kentucky set the record for the longest period with the lowest unemployment rates in state history. On May 18, Gov. Beshear announced that Kentucky set a new historic low unemployment rate of 3.7%, which is the lowest rate ever recorded in the commonwealth.
To encourage investment and job growth in the community, the Kentucky Economic Development Finance Authority (KEDFA) last Thursday preliminarily approved a 10-year incentive agreement with the company under the Kentucky Business Investment program. The performance-based agreement can provide up to $550,000 in tax incentives based on the company’s investment of $554,000 and annual targets of:
- Creation and maintenance of 98 Kentucky-resident, full-time jobs across 10 years; and
- Paying an average hourly wage of $24.28 including benefits across those jobs.
By meeting its annual targets over the agreement term, the company can be eligible to keep a portion of the new tax revenue it generates. The company may claim eligible incentives against its income tax liability and/or wage assessments.
In addition, Kroger can receive resources from Kentucky’s workforce service providers. Those include no-cost recruitment and job placement services, reduced-cost customized training and job-training incentives.
For more information on Kroger, visit Kroger.com.
A detailed community profile for Boone County can be viewed here.
Information on Kentucky’s economic development efforts and programs is available at CED.ky.gov. Fans of the Cabinet for Economic Development can also join the discussion at facebook.com/CEDkygov, on Twitter @CEDkygov, Instagram @CEDkygov and LinkedIn.