Dominick's, once a leader in the region, has steadily lost market share to area competitor Jewel since Safeway acquired the chain in 1998, says Pewaukee, WI-based grocery analyst David Livingston. At the time of the transaction, Dominick's operated 112 stores.

"It just didn't work out for them," Livingston says of the Safeway transaction. "They're not getting back to where they were before."

For its part, Dominick's is trying to attract consumers with its new "lifestyle" format stores, which include expanded selections of fresh and organic foods, as well as deli and seafood offerings and other features. Last year, 20 of the chain's units were remodeled into "lifestyle" stores and a new location opened in Chicago's Streeterville neighborhood. Another new unit is set to open in Chicago this year, and there are 20 more remodels on tap for the remainder of 2007, bringing half the chain to the upgraded concept.

"These are necessary steps that will help position Dominick's business for success and expansion in Chicagoland," says Don Keprta, Dominick's president, in a statement. Pleasanton, CA-based Safeway, which operates nearly 1,800 stores across the country, is also rolling out a lifestyle concept in its namesake chain.