MULTI-DEPARTMENT STORES Our multi-department stores operate under the Fred Meyer® banner with 132 locations in Alaska, Idaho, Oregon and Washington. Averaging over 161,000 square feet, this format is far larger than a Kroger® combo store. Most Fred Meyer locations also house a Fred Meyer Jewelers® (the nations’ 3rd largest jeweler), and 100 have a Fred Meyer Fuel Center. The average investment to build a multi-department store is over $29 million, including real estate. A Fred Meyer store is unlike any other. It’s not a big box store, hypermarket, supercenter, warehouse store or department store. Instead, Fred Meyer is a collection of specialty stores woven together seamlessly under one roof. The Food Department matches up well with Northwest Customers, who skew higher for healthier lifestyles and finer tastes than most of the country. That’s why since 1971, Fred Meyer has been a leader in bringing natural foods mainstream, with every store devoting an average of 3,000 square feet to natural products. It’s also why most Fred Meyer stores have experienced wine stewards, and why Murray’s Cheese Bar® is so successful here. This comprehensive, well-targeted food store is complemented by: 9 A complete Apparel & Shoe Store for the family 9 A Home Store loaded with fashion and function for every room While competitors might claim to be similar, further differentiation comes from a strong lineup of top brands like Adidas®, Apple®, Ashley®, Beats®, Bose®, Calphalon®, Carhartt®, Columbia Sportswear®, Converse®, DC®, Dockers®, KitchenAid®, Krups®, Levi’s®, Nike®, Quiksilver®, Roxy®, Samsung®, Skechers®, Sony®, Spyder®, Under Armour®, Vans® and Vizio®. Fred Meyer is the original – and still the best – One-Stop Shopping Store. The service, selection, quality and prices offered by combining so many specialty businesses under one roof and one ownership is a sustainable competitive advantage far greater than the sum of its parts. Our Customers perceive our strategic approach as a value to them because it improves their lives. They find more selection – plus save more time and money – in one stop at Fred Meyer than any other store. The Kroger Co. Page 11 .