Raley's to close Petaluma store, laying off 48 staff in wider downsizing push
The 91-year-old grocery chain is closing seven stores across California and Nevada as it battles online competition and shifting consumer habits, though it plans to open a new location in Madera next year.
The Raley's Companies has announced it will close its Petaluma, California, store on 26 January 2027, a move that will affect 48 employees. The closure is the latest in a regional downsizing strategy that involves the shuttering of seven stores across California and Nevada. The company stated that local market conditions and the need for long-term financial sustainability are driving these difficult decisions.
The West Sacramento-based chain, which operates approximately 235 stores, cited increased competition from online marketplaces and changing customer preferences as key factors impacting foot traffic and sales. Raley’s spokesperson Chelsea Carbahal noted that while the company is making tough choices, it aims to offer transfer opportunities to as many affected employees as possible.
This closure follows a series of recent exits that began in January 2026 with the closing of the Roseville store, followed by the Antioch location in April. A Nob Hill Foods store in Mountain View also closed on 29 May 2026, affecting 50 staff members. The chain has scheduled further closures for its Brentwood, California, store on 3 November 2026, and an Elko, Nevada, location in December 2026.
Looking ahead, the company plans to close its Nob Hill Foods store in Los Gatos, California, in June 2027 when its lease expires. Chief Marketing Officer Carol Barsotti indicated that this decision followed a review of the store’s performance and current economic conditions. Despite the contraction in its footprint, Raley’s intends to open a new store in Madera, California, in March 2027.
The moves align with broader trends in the grocery sector, where major competitors are also undergoing significant reductions. Kroger expects to close approximately 60 stores by the end of 2026, while Ahold Delhaize’s Stop & Shop chain confirmed it will close locations in New Jersey this year. Industry data from IBISWorld shows that supermarket revenue fell below 2021 levels in 2023 and 2024 before recovering in 2025, following significant food-at-home inflation in 2022 and 2023.
Founded in 1935, The Raley's Companies was formed in 2021 after the purchase of the Bashas Family of Stores. It currently operates under multiple brands, including Raley’s, Nob Hill Foods, and Bashas, across seven states and four tribal nations.
