Supermarkets are a staple of most neighborhoods, but their community status and financial well-being are under intense assault from rivals of all sizes that have steadily siphoned off the grocers’ customers. The supermarket industry’s latest travails came Wednesday when Albertsons’ parent company, Supervalu Inc., announced that it would close 26 stores this year, including 18 in Southern California, as it grapples with steep losses. Including other chains it operates, Supervalu is shutting about 60 stores nationwide. The company characterized the stores as underperforming or nonstrategic.

Loss-plagued Supervalu is one of the more troubled companies in the industry, and rivals such as Kroger Co., which operates Ralphs, and Safeway Inc., which runs Vons and Pavilions, are considered to be much better operators.

Nevertheless, Albertsons’ problems point out the challenges facing traditional supermarkets that are trying to fend off incursions from big-box retailers such as Target Corp. and Wal-Mart Stores Inc., specialty gourmet operators such as Tesco’s Fresh & Easy, and local dollar stores such as 99 Cents Only Stores. “The traditional grocery store is something of a dinosaur. The core question is whether it can be reinvented and re-created or whether we have to have a lot fewer of them,” said Jim Prevor, a food analyst at, a website that follows the fresh food industry.

Supermarkets’ share of the $800-billion market for food eaten at home shrank to 64.5 percent in 2010 from 72.1 percent in 2000, according to Moody’s Investors Service. Wal-Mart has made a huge push into the food aisle in recent years. Grocery sales accounted for 55 percent of the retail behemoth’s $264.2 billion in U.S. revenue in its last fiscal year, up from 47 percent in 2008.

The dismal outlook for the supermarket industry can be seen in the performance of the companies’ stocks in recent years. Supervalu shares have withered 95 percent since mid-2007. Safeway shares are down 57 percent. Kroger’s stock is off 26 percent, after moving sideways for much of the last four years. Shares of Whole Foods Market Inc., by contrast, have shot up 12-fold over the last four years. Fresh Market Inc., another specialty chain, is up more than 150 percent from its November 2010 initial public offering.

The supermarket industry has always had low profit margins, so companies have limited room to withstand pricing pressures. That is less of a concern for companies such as Wal-Mart and Target, which offer groceries as a way to attract shoppers who will buy more expensive items such as clothes.

Supermarkets have deployed various tactics to fight for market share, including ramping up their offerings of pricier organic goods and higher-margin private-label offerings. Companies such as Kroger also have become adept at figuring out to the penny how much they can charge for certain products without driving customers a few miles down the road to a lower-priced rival, said Jim Hertel, a managing partner at consulting firm Willard Bishop.