0001771515-22-000011 | 10-K | XBRL Viewer | Grocery Outlet Holding Corp

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CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Jan. 01, 2022	Jan. 02, 2021
Current assets:
Cash and cash equivalents	$ 140,085	$ 105,326
Independent operator receivables and current portion of independent operator notes, net of allowance $1,406 and $985	7,219	5,443
Other accounts receivable, net of allowance $57 and $39	3,159	5,950
Merchandise inventories	275,502	245,157
Prepaid expenses and other current assets	16,780	20,081
Total current assets	442,745	381,957
Independent operator notes, net of allowance $10,506 and $7,124	21,516	27,440
Property and equipment, net	499,387	433,652
Operating lease right-of-use assets	898,152	835,397
Intangible assets, net	51,921	48,226
Goodwill	747,943	747,943
Deferred income tax assets, net	0	3,529
Other assets	8,144	7,480
Total assets	2,669,808	2,485,624
Current liabilities:
Trade accounts payable	122,110	114,278
Accrued expenses	49,025	35,699
Accrued compensation	8,450	26,447
Current lease liabilities	51,136	48,675
Income and other taxes payable	7,185	7,547
Total current liabilities	237,906	232,646
Long-term debt, net	451,468	449,233
Deferred income tax liabilities, net	9,416	0
Long-term lease liabilities	961,746	881,438
Total liabilities	1,660,536	1,563,317
Commitments and contingencies
Stockholders' equity:
Voting common stock, par value $0.001 per share, 500,000,000 shares authorized; 96,144,433 and 94,854,336 shares issued and outstanding, respectively	96	95
Series A Preferred stock, par value $0.001 per share, 50,000,000 shares authorized; no shares issued and outstanding	0	0
Additional paid-in capital	811,701	787,047
Retained earnings	197,475	135,165
Total stockholders' equity	1,009,272	922,307
Total liabilities and stockholders' equity	$ 2,669,808	$ 2,485,624

CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands	Jan. 01, 2022	Jan. 02, 2021
Statement of Financial Position [Abstract]
Accounts and financing receivable, allowance for credit loss, current	$ 1,406	$ 985
Allowance for doubtful other receivables, current	57	39
Financing receivable, allowance for credit loss, noncurrent	$ 10,506	$ 7,124
Common stock, par (in usd per share)	$ 0.001	$ 0.001
Common stock, shares authorized (in shares)	500,000,000	500,000,000
Common stock, issued (in shares)	96,144,433	94,854,336
Common stock, outstanding (in shares)	96,144,433	94,854,336
Preferred stock, par (in usd per share)	$ 0.001	$ 0.001
Preferred stock, shares authorized (in shares)	50,000,000	50,000,000
Preferred stock, issued (in shares)	0	0
Preferred stock, outstanding (in shares)	0	0

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME - USD ($) shares in Thousands, $ in Thousands	12 Months Ended
	Jan. 01, 2022	Jan. 02, 2021	Dec. 28, 2019
Statement of Comprehensive Income [Abstract]
Net sales	$ 3,079,582	$ 3,134,640	$ 2,559,617
Cost of sales	2,130,796	2,161,293	1,772,515
Gross profit	948,786	973,347	787,102
Operating expenses:
Selling, general and administrative	773,718	772,409	639,437
Depreciation and amortization	68,358	55,479	47,883
Share-based compensation	17,615	38,084	31,439
Total operating expenses	859,691	865,972	718,759
Income from operations	89,095	107,375	68,343
Other expenses (income):
Interest expense, net	15,564	20,043	45,927
Gain on insurance recoveries	(3,970)	0	0
Debt extinguishment and modification costs	0	198	5,634
Total other expenses (income)	11,594	20,241	51,561
Income before income taxes	77,501	87,134	16,782
Income tax expense (benefit)	15,191	(19,579)	1,363
Net income	62,310	106,713	15,419
Net income and comprehensive income	$ 62,310	$ 106,713	$ 15,419
Basic earnings per share (in usd per share)	$ 0.65	$ 1.16	$ 0.20
Diluted earnings per share (in usd per share)	$ 0.63	$ 1.08	$ 0.19
Weighted average shares outstanding:
Basic (in shares)	95,725	91,818	79,044
Diluted (in shares)	99,418	98,452	81,863

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) $ in Thousands	Total	Cumulative Effect, Period of Adoption, Adjustment	Common Stock Voting Common	Common Stock Nonvoting Common	Preferred Stock	Additional Paid-In Capital	Retained Earnings	Retained Earnings Cumulative Effect, Period of Adoption, Adjustment
Beginning balance (in shares) at Dec. 29, 2018			67,435,288	1,038,413	1
Beginning balance at Dec. 29, 2018	$ 299,951	$ 168	$ 67	$ 1	$ 0	$ 287,457	$ 12,426	$ 168
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Issuance of common shares upon initial public offering, net of underwriting discounts (in shares)			19,765,625
Issuance of common shares upon initial public offering, net of underwriting discounts	407,666		$ 20			407,646
Other direct initial public offering costs	(7,245)					(7,245)
Conversion of non-voting to voting common stock (in shares)			1,068,413	(1,068,413)
Conversion of nonvoting to voting common shares	0		$ 1	$ (1)
Redemption of preferred stock (in shares)					(1)
Exercise and vest of share-based awards (in shares)			735,736	30,000
Exercise and vesting of share-based awards	4,444		$ 1			4,443
Tax paid on behalf of employees related to net settlement of share-based awards	(2,813)					(2,813)
Share-based compensation expense	31,439					31,439
Dividends paid	(3,645)					(3,645)
Net income (loss)	15,419						15,419
Comprehensive income (loss)	15,419						15,419
Ending balance (in shares) at Dec. 28, 2019			89,005,062	0	0
Ending balance at Dec. 28, 2019	745,384	$ 439	$ 89	$ 0	$ 0	717,282	28,013	$ 439
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Exercise and vest of share-based awards (in shares)			5,849,274
Exercise and vesting of share-based awards	32,604		$ 6			32,598
Tax paid on behalf of employees related to net settlement of share-based awards	(483)					(483)
Share-based compensation expense	38,084					38,084
Dividends paid	(434)					(434)
Net income (loss)	106,713						106,713
Comprehensive income (loss)	106,713						106,713
Ending balance (in shares) at Jan. 02, 2021			94,854,336	0	0
Ending balance at Jan. 02, 2021	922,307		$ 95	$ 0	$ 0	787,047	135,165
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Exercise and vest of share-based awards (in shares)			1,290,097
Exercise and vesting of share-based awards	7,226		$ 1			7,225
Share-based compensation expense	17,615					17,615
Dividends paid	(186)					(186)
Net income (loss)	62,310						62,310
Comprehensive income (loss)	62,310						62,310
Ending balance (in shares) at Jan. 01, 2022			96,144,433	0	0
Ending balance at Jan. 01, 2022	$ 1,009,272		$ 96	$ 0	$ 0	$ 811,701	$ 197,475

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	12 Months Ended
	Jan. 01, 2022	Jan. 02, 2021	Dec. 28, 2019
Cash flows from operating activities:
Net income (loss)	$ 62,310	$ 106,713	$ 15,419
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation of property and equipment	63,442	50,749	42,906
Amortization of intangible and other assets	7,682	7,302	7,237
Amortization of debt issuance costs and debt discounts	2,511	2,452	2,542
Gain on insurance recoveries	(3,970)	0	0
Debt extinguishment and modification costs	0	198	5,634
Share-based compensation	17,615	38,084	31,439
Provision for independent operator notes, independent operator receivables and other accounts receivable	4,813	(456)	2,575
Proceeds from insurance recoveries - business interruption and inventory	2,103	479	0
Deferred income taxes	12,944	(19,578)	872
Other	1,251	1,954	1,955
Changes in operating assets and liabilities:
Independent operator and other accounts receivable	(21)	(4,943)	(3,649)
Merchandise inventories	(30,345)	(25,737)	(21,115)
Prepaid expenses and other current assets	3,301	(6,628)	498
Income and other taxes payable	(362)	2,906	1,191
Trade accounts payable, accrued compensation and other accrued expenses	3,179	4,778	22,599
Changes in operating lease assets and liabilities, net	19,134	22,964	22,732
Net cash provided by operating activities	165,587	181,237	132,835
Cash flows from investing activities:
Advances to independent operators	(10,024)	(10,372)	(12,811)
Repayments of advances from independent operators	4,563	6,793	4,473
Purchases of property and equipment	(123,384)	(124,920)	(97,194)
Proceeds from sales of assets	37	269	586
Investments in intangible assets and licenses	(9,772)	(5,861)	(3,073)
Proceeds from insurance recoveries - property and equipment	1,867	305	0
Net cash used in investing activities	(136,713)	(133,786)	(108,019)
Cash flows from financing activities:
Proceeds from initial public offering, net of underwriting discounts paid	0	0	407,666
Proceeds from exercise of stock options	7,226	32,604	4,444
Proceeds from revolving credit facility loan	0	90,000	0
Principal payments on revolving credit facility loan	0	(90,000)	0
Payments made for net settlement of employee share-based compensation awards	0	(483)	(2,813)
Other direct costs paid related to the initial public offering	0	0	(7,062)
Principal payments on term loans	0	(188)	(414,813)
Principal payments on other borrowings	(1,155)	(1,024)	(865)
Dividends paid	(186)	(434)	(3,645)
Debt issuance costs paid	0	(701)	(690)
Net cash provided by financing activities	5,885	29,774	(17,778)
Net increase in cash and cash equivalents	34,759	77,225	7,038
Cash and cash equivalents - Beginning of the period	105,326	28,101	21,063
Cash and cash equivalents at end of period	140,085	105,326	28,101
Supplemental disclosure of cash flow information:
Cash paid for interest	14,604	20,311	49,372
Income taxes paid (refunded) in cash	477	5,186	(65)
Property and equipment accrued at end of period	14,986	15,604	10,498
Intangible assets accrued at end of period	1,613	1,050	0
Acquisition of equipment in exchange for reduction of independent operator notes and independent operator receivables	$ 7,609	$ 0	$ 0

Organization and Summary of Significant Accounting Policies

12 Months Ended

Jan. 01, 2022

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Organization and Summary of Significant Account Policies

Organization and Summary of Significant Accounting Policies

Description of Business — Based in Emeryville, California, and incorporated in Delaware in 2014, Grocery Outlet Holding Corp. (together with its wholly owned subsidiaries, collectively, "Grocery Outlet," "we," or the "Company") is a high-growth, extreme value retailer of quality, name-brand consumables and fresh products sold through a network of independently operated stores. As of January 1, 2022, we had 415 stores throughout California, Washington, Oregon, Pennsylvania, Idaho, Nevada and New Jersey.

Fiscal Year — We operate on a fiscal year that ends on the Saturday closest to December 31st each year. The fiscal years ended January 1, 2022 ("fiscal 2021") and December 28, 2019 ("fiscal 2019") consisted of 52 weeks while the fiscal year ended January 2, 2021 ("fiscal 2020") consisted of 53 weeks.

Basis of Presentation — The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP") and the applicable rules and regulations of the U.S. Securities and Exchange Commission (the "SEC"). Our consolidated financial statements include the accounts of Grocery Outlet Holding Corp. and its wholly owned subsidiaries. All intercompany balances and transactions were eliminated. In the opinion of management, these consolidated financial statements include all adjustments, consisting of normal recurring adjustments, necessary for a fair statement of the results for the periods presented. Certain prior period amounts in the notes to the consolidated financial statements have been reclassified to conform to the current period presentation. The reclassification of these items had no impact on net income, earnings per share, or retained earnings in the current or prior period.

Use of Estimates — The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results can differ from these estimates depending upon certain risks and uncertainties. Changes in these estimates are recorded when known.

Segment Reporting — We manage our business as one operating segment. All of our sales were made to customers located in the United States and all property and equipment is located in the United States.

Cash and Cash Equivalents — We consider all highly liquid investments, purchased with original maturities of three months or less, to be cash equivalents. All cash equivalents are unrestricted and available for immediate use.

Allowance for Independent Operator ("IO") Receivables and IO Notes and Other Accounts Receivable — We maintain allowances and accruals for estimated losses of amounts advanced to IOs and other third parties determined to be uncollectible. See NOTE 2—Independent Operator Notes and Independent Operator Receivables, for additional information.

Concentrations of Credit Risk — Financial instruments which potentially subject us to concentrations of credit risk consist primarily of cash and cash equivalents and accounts and notes receivable. Although we deposit our cash with creditworthy financial institutions, our deposits typically exceed federally insured limits. To date, we have not experienced any losses on our cash deposits. No single customer or store represented more than 10% of net sales for the fiscal years ended January 1, 2022, January 2, 2021 and December 28, 2019. No single customer or IO represented more than 10% of accounts receivable or notes receivable as of January 1, 2022 and January 2, 2021.

Merchandise Inventories — Merchandise inventories are valued at the lower of cost or net realizable value. Cost is determined by the weighted-average cost method for warehouse inventories and the retail inventory method for store inventories. We provide for estimated inventory losses between physical inventory counts based on historical averages. This provision is adjusted periodically to reflect the actual shrink results of the physical inventory counts.

Property and Equipment — Property and equipment is stated at cost less accumulated depreciation and includes expenditures for significant improvements to leased premises. Depreciation of property and equipment is calculated using the straight-line method over the estimated useful lives of the assets, generally ranging from three to 15 years. Amortization of leasehold improvements is calculated based on the shorter of their estimated useful life or the remaining terms of the lease. Remaining lease terms currently range from one to 17 years.

We evaluate events and changes in circumstances that could indicate carrying amounts of long-lived assets, including property and equipment, may not be recoverable. When such events or changes in circumstances occur, we assess the recoverability of long-lived assets by determining whether or not the carrying value of such assets will be recovered through undiscounted future cash flows derived from their use and eventual disposition. For purposes of this assessment, long-lived assets are grouped with other assets and liabilities at the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities, primarily at an individual store level. If the sum of the undiscounted future cash flows is less than the carrying amount of an asset, we record an impairment loss for the amount by which the carrying amount of the asset exceeds its fair value. The total amount of property and equipment, including store assets, and operating lease right-of-use assets as of January 1, 2022 were $499.4 million and $898.2 million, respectively. The estimated fair value of the asset or asset group is based on the estimated discounted future cash flows of the asset or asset group using a discount rate commensurate with the related risk. There were no adjustments to the carrying value of long-lived assets due to impairment charges during fiscal 2021 and 2020. We recorded impairment charges of $0.5 million during fiscal 2019. See NOTE 3—Property and Equipment, for additional information.

Leases — We determine if an arrangement is a lease at inception. Operating leases are included in operating lease right-of-use assets, current lease liabilities, and long-term lease liabilities on our consolidated balance sheets. Finance leases are included in other assets, current lease liabilities, and long-term lease liabilities on our consolidated balance sheets. Right-of-use assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease over the same term. Right-of-use assets and liabilities are recognized at commencement date based on the present value of the lease payments over the lease term, reduced by landlord incentives. As most of our leases do not provide an implicit rate, we use our incremental borrowing rate, which is estimated to approximate the interest rate on a collateralized basis with similar terms and payments based on the information available at the commencement date to determine the present value of our lease payments. Lease term is defined as the non-cancelable period of the lease plus any options to extend or terminate the lease when it is reasonably certain that we will exercise the option. Lease expense for operating lease payments is recognized on a straight-line basis over the lease term while finance lease payments are charged to interest expense and depreciation and amortization expense over the lease term. Leases with an initial term of 12 months or less are not recorded on the balance sheet; lease expense for these short-term leases is recognized on a straight-line basis over the lease term.

We generally lease retail facilities for store locations, distribution centers, office space and equipment and account for these leases as operating leases. We account for one retail store lease and certain equipment leases as finance leases. Lease and non-lease components are accounted for separately. We sublease certain real estate to unrelated third parties under non-cancelable leases and the sublease portfolio consists of operating leases for retail stores.

Goodwill and Other Intangible Assets — We have both goodwill and intangible assets recorded on our consolidated balance sheets.

Goodwill represents the difference between the purchase price and the fair value of assets and liabilities acquired in a business combination. Goodwill is not amortized, but rather is subject to an annual impairment evaluation which is performed during our fourth quarter or when events or changes in circumstances indicate that the value of goodwill may be impaired. Our impairment evaluation of goodwill consists of an initial qualitative assessment of our reporting unit to determine whether it is more-likely-than-not that the fair value of the reporting unit is less than its carrying value. If it is concluded that this is the case, a quantitative evaluation, based on discounted cash flows, is performed which requires us to estimate future cash flows, growth rates and economic and market conditions. If the quantitative evaluation indicates that goodwill is not recoverable, an impairment loss is calculated and recognized during that period. Measurement of such an impairment loss would be based on the excess of the carrying amount over fair value. There were no goodwill impairment charges recorded during the fiscal years ended January 1, 2022, January 2, 2021 and December 28, 2019. There were no changes in the carrying amount of goodwill for the fiscal years ended January 1, 2022, January 2, 2021, and December 28, 2019.

Intangible assets include trademarks, computer software, and liquor licenses. Trademarks represent the value of all our trademarks and trade names in the marketplace. We are amortizing the value assigned to the trade names on a straight-line basis over 15 years. Computer software includes both acquired software and eligible costs to develop internal-use software that are incurred during the application development stage. These assets are amortized over their estimated useful lives of three to 10 years. Liquor license assets have been classified as indefinite-lived intangible assets and accordingly, are not subject to amortization. We review our intangible assets for impairment when events or changes in circumstances indicate that the carrying amount may not be recoverable. If the carrying amount of the intangible assets are not recoverable, the impairment is measured as the amount by which the carrying value of the intangible asset exceeds its fair value. There were no impairments of intangible assets recognized during the fiscal years ended January 1, 2022, January 2, 2021 and December 28, 2019.

Fair Value Measurements — Fair value is defined as the exchange price, or exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. The fair value of financial instruments is categorized based upon the level of judgment associated with the inputs used to measure their fair values. Fair value is measured using inputs from the three levels of the fair value hierarchy, which are described as follows:

Level 1 — Quoted prices in active markets for identical assets or liabilities

Level 2 — Quoted prices for similar assets and liabilities in active markets or inputs that are observable

Level 3 — Unobservable inputs in which there is little or no market data, which requires us to develop our own assumptions when pricing the financial instruments, such as cash flow modeling assumptions.

The assets' or liabilities' fair value measurement level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. The fair value framework requires that we maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value.

There were no assets or liabilities measured at fair value on a recurring basis as of January 1, 2022 or January 2, 2021. Generally, assets are recorded at fair value on a nonrecurring basis as a result of impairment charges. See NOTE 3—Property and Equipment and NOTE 5—Goodwill and Intangible Assets, for additional information. There were no transfers of assets or liabilities between levels within the fair value hierarchy during the fiscal years ended January 1, 2022 or January 2, 2021.

Our financial assets and liabilities are carried at cost, which generally approximates their fair value, as described below:

Cash and cash equivalents, IO receivables, other accounts receivable and accounts payable — The carrying value of such financial instruments approximates their fair value due to factors such as their short-term nature or their variable interest rates.

IO notes receivable (net) — The carrying value of such financial instruments approximates their fair value due to the effect of the related allowance for expected credit losses.

The following table sets forth by level within the fair value hierarchy the carrying amounts and estimated fair values of our significant financial liabilities that are not recorded at fair value on the consolidated balance sheets (amounts in thousands):


	January 1, 2022				January 2, 2021
	Carrying Amount (1)		Estimated Fair Value (2)		Carrying Amount (1)		Estimated Fair Value (2)
Financial Liabilities:
Term loan (Level 2)	$	451,468	$	457,700	$	449,233	$	460,000

_______________________

(1)The carrying amounts as of January 1, 2022 and January 2, 2021 are net of unamortized debt discounts of $1.0 million and $1.2 million, respectively, and debt issuance costs of $7.5 million and $9.5 million, respectively.

(2)The estimated fair value of our term loan was determined based on the average quoted bid-ask prices for the term loan in an over-the-counter market on the last trading day of fiscal 2021 and 2020.

Revenue Recognition

Net Sales — We recognize revenue from the sale of products at the point of sale, net of any taxes or deposits collected and remitted to governmental authorities. For e-commerce related sales in which a third-party company provides home delivery service, revenue is recognized upon delivery to the customer. Our performance obligations are satisfied upon the transfer of goods to the customer, at the point of sale, and payment from customers is also due at the time of sale. Discounts provided to customers by us are recognized at the time of sale as a reduction in sales as the products are sold. Discounts provided by IOs are not recognized as a reduction in sales as these are provided solely by the IO who bears the incremental costs arising from the discount. We do not accept manufacturer coupons.

We do not have any material contract assets or receivables from contracts with customers, any revenue recognized in the current year from performance obligations satisfied in previous periods, any performance obligations, or any material costs to obtain or fulfill a contract as of January 1, 2022 and January 2, 2021.

Gift Cards — We record a deferred revenue liability when a Grocery Outlet gift card is sold. Revenue related to gift cards is recognized as the gift cards are redeemed, which is when we have satisfied our performance obligation. While gift cards are generally redeemed within 12 months, some are never fully redeemed. We reduce the liability and recognize

revenue for the unused portion of the gift cards ("breakage") under the proportional method, where recognition of breakage income is based upon the historical run-off rate of unredeemed gift cards. Our gift card deferred revenue liability was $3.6 million as of January 1, 2022 and $3.2 million as of January 2, 2021. Breakage amounts were $0.3 million and $0.2 million for the fiscal years ended January 1, 2022 and January 2, 2021, respectively, and less than $0.1 million for the fiscal year ended December 28, 2019.

Disaggregated Revenues — The following table presents net sales revenue by type of product for the fiscal years ended January 1, 2022, January 2, 2021, and December 28, 2019 (amounts in thousands); e-commerce sales have been allocated to their respective product type:


	January 1, 2022		January 2, 2021		December 28, 2019
Perishable (1)	$	1,067,198	$	1,054,506	$	868,109
Non-perishable (2)	2,012,384		2,080,134		1,691,508
Total sales (3)	$	3,079,582	$	3,134,640	$	2,559,617

_______________________

(1)Perishable departments include dairy and deli; produce and floral; and fresh meat and seafood.

(2)Non-perishable departments include non-perishable grocery; general merchandise; health and beauty care; frozen foods; and beer and wine.

(3)The fiscal years ended January 1, 2022 and December 28, 2019 consisted of 52 weeks while the fiscal year ended January 2, 2021 consisted of 53 weeks.

Cost of Sales — Cost of sales includes, among other things, merchandise costs, inventory markdowns, shrink and transportation, third-party delivery fees and distribution and warehousing costs, including depreciation.

Marketing and Advertising Expenses — Costs for store promotions, newspaper, television, radio and other media advertising are expensed at the time the promotion or advertising takes place. Advertising costs are included in SG&A in the accompanying consolidated statements of operations and comprehensive income and amounted to approximately $32.6 million, $25.9 million and $26.2 million, respectively, in the fiscal years ended January 1, 2022, January 2, 2021 and December 28, 2019.

Share-based Awards — We estimate the fair value of time-based stock option awards subject to only a service condition on the date of grant using the Black-Scholes valuation model. The Black-Scholes model requires the use of certain input assumptions. Because we completed our IPO during fiscal 2019, for awards granted in fiscal 2019 we had limited historical exercise data from which to derive such input assumptions, including an option's expected term and the price volatility of the underlying stock. Consequently, we determined the expected term using an accepted, simplified formula which derives an expected term by taking the sum of the contractual term and adding the length of the vesting period and dividing by two. We estimated stock price volatility for our common stock by taking the average historic price volatility for industry peers based on daily price observations over a period equivalent to the expected term of the stock option grants. Industry peers consist of several public companies in our industry which are of similar size, complexity and stage of development. The risk-free interest rate for the expected term of the option was based on the U.S. Treasury implied yield at the date of grant. We did not award any time-based or performance-based stock options during fiscal 2021 and 2020.

We estimate the fair value of performance-based stock option awards subject to both a market condition and a performance condition on the date of grant using a Monte Carlo simulation approach implemented in a risk-neutral framework.

We estimate the fair value of restricted stock units ("RSUs") and performance-based restricted stock units ("PSUs") based upon the closing price of our common stock as reported on the Nasdaq Global Select Market on the date of grant. The PSUs vest in one installment after a three year performance period based on the achievement of cumulative operating goals.

We recognize compensation expense for share-based payment awards with only a service condition on a straight-line basis over the requisite service period, which is generally the award's vesting period. Vesting of these awards would be accelerated for certain employees in the event of a change in control as well as certain termination events. Compensation expense for share-based payment awards subject to vesting based upon the achievement of a performance condition is recognized on a graded-vesting basis at the time the achievement of the performance condition becomes probable.

We recognize share-based award forfeitures as they occur rather than estimating by applying a forfeiture rate.

While we recognize share-based compensation expense over the performance period and/or requisite service period based on the fair market value of the award as of the grant date, we will not know the actual amount of tax benefit an award will generate until such award is exercised (or vested for RSUs or PSUs)). Until such award is exercised (or vested for RSUs or PSUs) we assume that the amount ultimately recognized for tax purposes is the same amount we are currently recognizing in our operating results, that is for "book" purposes. Consequently, our deferred tax asset related to share-based compensation expense, which totaled $10.9 million as of January 1, 2022, is based on each qualifying award's grant date fair value rather than the award's to-be-determined exercise date intrinsic value (or vesting date fair value). For awards exercised (or vested for RSUs) during our fiscal year ended January 1, 2022, the difference between the grant date fair value and the exercise or vest date intrinsic value totaled $30.3 million. If the share price for our common stock were to depreciate for a sustained period of time, we could be required to recognize a tax shortfall. Such shortfalls could have a material effect on our cash flows and financial results. See NOTE 8—Share-based Awards and NOTE 10—Income Taxes, for additional information.

Income Taxes — Income taxes are accounted for using an asset and liability approach that requires recognition of deferred tax assets and liabilities for expected future tax consequences of events that have been recognized in our consolidated financial statements or tax returns. In estimating future tax consequences, all expected future events are considered, other than changes in the tax law. A valuation allowance is established, when necessary, to reduce net deferred income tax assets to the amount expected to be realized. We have not recorded any valuation allowances against our deferred income tax balances for the fiscal years ended January 1, 2022 and January 2, 2021. Significant items comprising our future tax benefits and liabilities (deferred tax assets and liabilities) include net operating losses, depreciation and amortization, goodwill, intangible assets, lease liability obligations and right-of-use assets.

We recognize interest and penalties accrued on any unrecognized tax benefits as a component of income tax expense. We record uncertain tax positions in accordance with ASC Topic 740, Income Taxes, on the basis of a two-step process in which (i) we determine whether it is more likely than not that the tax positions will be sustained on the basis of the technical merits of the position and (ii) for those tax positions that meet the more likely-than-not recognition threshold, we recognize the largest amount of tax benefit that is more than 50 percent likely to be realized upon ultimate settlement with the related tax authority.

Variable Interest Entities — In accordance with the variable interest entities sub-section of ASC Topic 810, Consolidation, we assess at each reporting period whether we, or any consolidated entity, are considered the primary beneficiary of a variable interest entity ("VIE") and therefore required to consolidate the financial results of the VIE in our consolidated financial statements. Determining whether to consolidate a VIE may require judgment in assessing (i) whether an entity is a VIE, and (ii) if a reporting entity is a VIE's primary beneficiary. A reporting entity is determined to be a VIE's primary beneficiary if it has the power to direct the activities that most significantly impact a VIE's economic performance and the obligation to absorb losses or rights to receive benefits that could potentially be significant to a VIE.

We had 411, 375 and 342 stores operated by IOs as of January 1, 2022, January 2, 2021 and December 28, 2019, respectively. We have agreements in place with each IO. The IO orders merchandise exclusively from us which is provided to the IO on consignment. Under the Independent Operator Agreement (the "Operator Agreement"), the IO may select a majority of merchandise that we consign to the IO, which the IO chooses from our merchandise order guide according to the IO's knowledge and experience with local customer purchasing trends, preferences, historical sales and similar factors. The Operator Agreement gives the IO discretion to adjust our initial prices if the overall effect of all price changes at any time comports with the reputation of our Grocery Outlet retail stores for selling quality, name-brand consumables and fresh products and other merchandise at extreme discounts. IOs are required to furnish initial working capital and to acquire certain store and safety assets. The IO is also required to hire, train and employ a properly trained workforce sufficient in number to enable the IO to fulfill its obligations under the Operator Agreement. Additionally, the IO is responsible for expenses required for business operations, including all labor costs, utilities, credit card processing fees, supplies, taxes, fines, levies and other expenses. Either party may terminate the Operator Agreement without cause upon 75 days' notice.

As consignor of all merchandise to each IO, the aggregate net sales proceeds from merchandise sales belongs to us. Net sales related to IO stores were $3.0 billion, $3.1 billion, and $2.5 billion for the fiscal years ended January 1, 2022, January 2, 2021, and December 28, 2019, respectively. We, in turn, pay IOs a commission based on a share of the gross profit of the store. Inventories and related net sales proceeds are our property, and we are responsible for store rent and related occupancy costs. IO commissions were expensed and included in SG&A. IO commissions were $463.8 million, $469.3 million, and $382.8 million for the fiscal years ended January 1, 2022, January 2, 2021, and December 28, 2019, respectively. IO commissions of $9.1 million and $6.0 million were included in accrued expenses as of January 1, 2022 and January 2, 2021, respectively.

IOs may fund their initial store investment from existing capital, a third-party loan or most commonly through a loan from us, as further discussed in NOTE 2—Independent Operator Notes and Independent Operator Receivables. As collateral for IO obligations and performance, the Operator Agreements grant us the security interests in the assets owned by the IOs related to the respective store. Since the total investment at risk associated with each IO is not sufficient to permit each IO to finance its activities without additional subordinated financial support, the IOs are VIEs which we have variable interests in. To determine if we are the primary beneficiary of these VIEs, we evaluate whether we have (i) the power to direct the activities that most significantly impact the IO's economic performance and (ii) the obligation to absorb losses or the right to receive benefits of the IO that could potentially be significant to the IO. Our evaluation includes identification of significant activities and an assessment of its ability to direct those activities.

Activities that most significantly impact the IO's economic performance relate to sales and labor. Sales activities that significantly impact the IO's economic performance include determining what merchandise the IO will order and sell and the price of such merchandise, both of which the IO controls. The IO is also responsible for all of their own labor. Labor activities that significantly impact the IO's economic performance include hiring, training, supervising, directing, compensating (including wages, salaries and employee benefits) and terminating all of the employees of the IO, activities which the IO controls. Accordingly, the IO has the power to direct the activities that most significantly impact the IO's economic performance. Furthermore, the mutual termination rights associated with the Operator Agreements illustrate the lack of ultimate control over the IO. Therefore, the Company is not the primary beneficiary of these VIEs.

Our maximum exposure to the IOs is generally limited to the IO notes and IO receivables due from these entities, which was $40.6 million and $41.0 million as of January 1, 2022 and January 2, 2021, respectively. See NOTE 2—Independent Operator Notes and Independent Operator Receivables, for additional information.

Net Income Per Share — Basic net income per share is calculated using net income available to common stockholders divided by the weighted-average number of common shares outstanding during the period. Diluted net income per share reflects the dilutive effects of stock options and RSUs outstanding during the period, to the extent such securities would not be anti-dilutive, and is determined using the treasury stock method.

Recently Adopted Accounting Standards

ASU No. 2019-12 —In December 2019, the FASB issued ASU No. 2019-12, Simplifying the Accounting for Income Taxes ("ASU 2019-12"). ASU 2019-12 simplifies accounting guidance for certain tax matters including franchise taxes, certain transactions that result in a step-up in tax basis of goodwill, and enacted changes in tax laws in interim periods. In addition, it eliminates a company's need to evaluate certain exceptions relating to the incremental approach for intra-period tax allocation, accounting for basis differences when there are ownership changes in foreign investments, and interim period income tax accounting for year-to-date losses that exceed anticipated losses. ASU 2019-12 is effective for fiscal years beginning after December 15, 2020, including interim periods within those fiscal years. We adopted ASU 2019-12 beginning in the first quarter of fiscal 2021. The adoption of ASU 2019-12 did not have a material impact on our consolidated financial statements.

Recently Issued Accounting Pronouncements

No recently issued accounting pronouncements are expected to have a material effect on our consolidated financial statements.

Independent Operator Notes and Independent Operator Receivables

12 Months Ended

Jan. 01, 2022

Receivables [Abstract]

Independent Operator Notes and Independent Operator Receivables

Independent Operator Notes and Independent Operator Receivables The amounts included in IO notes and IO receivables consist primarily of funds we loaned to IOs, net of estimated uncollectible amounts. IO notes are payable on demand and typically bear interest at rates between 3.00% and 9.95%. Accrued interest receivable on IO notes is included within the "independent operator receivables and current portion of independent operator notes, net of allowance" line item on the condensed consolidated balance sheets and was $0.5 million and $0.4 million as of January 1, 2022 and January 2, 2021, respectively. There were no IO notes that were past due or on a non-accrual status due to delinquency as of January 1, 2022 or January 2, 2021. Notes and receivables from our IOs

participating in our TCAP, as defined below, are not considered to be past due or on a non-accrual status due to delinquency and are excluded from such measures.

IO notes and receivables are financial assets which are measured and carried at amortized cost. An allowance for expected credit losses is deducted from (for expected losses) or added to (for expected recoveries) the amortized cost basis of these assets to arrive at the net carrying amount expected to be collected for such assets.

The allowance is estimated using an expected loss framework, which includes information about past events, current conditions, and reasonable and supportable forecasts that impact the collectibility of the reported amounts of the assets over their lifetime. The allowance is evaluated on a collective basis for assets with shared risk characteristics and credit quality indicators. The primary shared risk characteristic and credit quality indicator pools that we use as a basis for collective evaluation include:

•TCAP — Includes the notes and receivables from IOs with stores that have been open for more than 18 months that are participating in our Temporary Commission Adjustment Program ("TCAP") as of the end of each reporting period. TCAP allows us to provide a greater commission to participating IOs who require assistance in meeting their working capital needs for various reasons, such as new or increased competition or differences in IO skills and experience.

•Non-TCAP — Includes the notes and receivables from IOs with stores that have been open for more than 18 months that are not participating in TCAP as of the end of each reporting period.

•New store — Includes the notes and receivables from IOs with stores that have been open for less than 18 months as of the end of each reporting period.

Assets without such shared risk characteristics or credit quality indicators, such as assets with unique circumstances or with delinquencies and historical losses in excess of their TCAP, non-TCAP or new store peers are evaluated on an individual basis.

Amounts due from IOs and the related allowances as of January 1, 2022 and January 2, 2021 consisted of the following (amounts in thousands):


			Allowance						Current Portion		Long-term Portion
	Gross		Current Portion		Long-term Portion		Net
January 1, 2022
Independent operator notes	$	34,221	$	(811)	$	(10,506)	$	22,904	$	1,388	$	21,516
Independent operator receivables	6,426		(595)		—		5,831		5,831		—
Total	$	40,647	$	(1,406)	$	(10,506)	$	28,735	$	7,219	$	21,516


			Allowance						Current Portion		Long-term Portion
	Gross		Current Portion		Long-term Portion		Net
January 2, 2021
Independent operator notes	$	37,238	$	(514)	$	(7,124)	$	29,600	$	2,160	$	27,440
Independent operator receivables	3,754		(471)		—		3,283		3,283		—
Total	$	40,992	$	(985)	$	(7,124)	$	32,883	$	5,443	$	27,440

A summary of activity in the IO notes and IO receivables allowance was as follows (amounts in thousands):


	Fiscal Year Ended
	January 1, 2022		January 2, 2021		December 28, 2019
Beginning balance	$	8,109	$	10,371	$	9,067
Provision for IO notes and IO receivables	4,790		(473)		2,741
Cumulative effect of accounting change	—		(439)		—
Write-off of provision for IO notes and IO receivables	(987)		(1,350)		(1,437)
Ending balance	$	11,912	$	8,109	$	10,371

The following table presents the amortized cost basis of IO notes by year of origination and credit quality indicator as of January 1, 2022 (amounts in thousands):


Credit Quality Indicator	2021		2020		2019		2018		2017		Prior		Total
TCAP	$	3,182	$	2,331	$	1,791	$	1,058	$	463	$	257	$	9,082
Non-TCAP	5,157		3,709		3,673		2,085		881		371		15,876
New store	6,615		2,648		—		—		—		—		9,263
Total	$	14,954	$	8,688	$	5,464	$	3,143	$	1,344	$	628	$	34,221

Property and Equipment

12 Months Ended

Jan. 01, 2022

Property, Plant and Equipment [Abstract]

Property and Equipment

Property and equipment as of January 1, 2022 and January 2, 2021 consisted of the following (amounts in thousands):


	Property and Equipment, At Cost		Accumulated Depreciation and Amortization		Property and Equipment, Net
January 1, 2022
Leasehold improvements	$	333,053	$	(92,815)	$	240,238
Fixtures and equipment	396,500		(170,487)		226,013
Other	376		(295)		81
Construction in progress	33,055		—		33,055
Totals	$	762,984	$	(263,597)	$	499,387
January 2, 2021
Leasehold improvements	$	275,586	$	(70,999)	$	204,587
Fixtures and equipment	330,338		(134,820)		195,518
Other	376		(282)		94
Construction in progress	33,453		—		33,453
Totals	$	639,753	$	(206,101)	$	433,652

Construction in progress is primarily composed of leasehold improvements and fixtures and equipment related to new or remodeled stores where construction had not been completed at year-end.

Depreciation expense on property and equipment for fiscal 2021, 2020 and 2019 was as follows (amounts in thousands):


	Fiscal Year Ended
Consolidated Statements of Operations and Comprehensive Income Location	January 1, 2022		January 2, 2021		December 28, 2019
Cost of sales	$	1,486	$	1,299	$	1,210
Operating expenses	61,956		49,450		41,696
Total depreciation expense on property and equipment	$	63,442	$	50,749	$	42,906

Leases

12 Months Ended

Jan. 01, 2022

Leases [Abstract]

Leases

Leases for 15 of our store locations and one warehouse location are controlled by related parties as of January 1, 2022 and January 2, 2021. See NOTE 11—Related Party Transactions, for additional information.

As of January 1, 2022, we had executed leases for 25 store locations that we had not yet taken possession of with total undiscounted future lease payments of $141.9 million and lease terms through 2039.

Based upon our initial investment in store leasehold improvements, we utilize an initial, reasonably-certain lease life of 15 years. Most leases include one or more options to renew, with renewal terms that can extend the lease term from five to 15 years or more. Our leases do not include any material residual value guarantees or material restrictive covenants. We also have non-cancelable subleases with unrelated third parties with future minimum rental receipts as of January 1, 2022 totaling $5.3 million ending in various years through 2036, which have not been deducted from the future minimum lease payments.

The balance sheet classification of our right-of-use lease assets and lease liabilities was as follows (amounts in thousands):


Leases	Classification	January 1, 2022		January 2, 2021
Assets:
Operating lease assets	Operating right-of-use assets	$	898,152	$	835,397
Finance lease assets	Other assets	6,896		5,973
Total lease assets		$	905,048	$	841,370
Liabilities:
Current
Operating	Current lease liabilities	$	49,861	$	47,730
Finance	Current lease liabilities	1,275		945
Noncurrent
Operating	Long-term lease liabilities	956,104		876,329
Finance	Long-term lease liabilities	5,642		5,109
Total lease liabilities		$	1,012,882	$	930,113

The components of lease expense were as follows (amounts in thousands):


		Fiscal Year Ended
Lease Cost	Classification (1)	January 1, 2022		January 2, 2021		December 28, 2019
Operating lease cost	Selling, general and administrative expenses	$	123,799	$	112,096	$	99,237
Finance lease cost:
Amortization of right-of-use assets	Depreciation and amortization	1,249		964		817
Interest on leased liabilities	Interest expense, net	378		376		263
Variable lease cost	Selling, general and administrative expenses	547		700		668

Sublease income	Selling, general and administrative expenses	(1,114)		(972)		(1,248)
Net lease cost		$	124,859	$	113,164	$	99,737

_______________________

(1)Certain supply chain related lease costs herein are included in cost of sales.

Maturities of lease liabilities as of January 1, 2022 were as follows (amounts in thousands):


	Operating Leases		Finance Leases		Total
Fiscal 2022	$	113,191	$	1,605	$	114,796
Fiscal 2023	126,143		1,503		127,646
Fiscal 2024	125,713		1,438		127,151
Fiscal 2025	124,371		1,207		125,578
Fiscal 2026	123,687		839		124,526
Thereafter	832,129		1,486		833,615
Total lease payments	1,445,234		8,078		$	1,453,312
Less: Imputed interest	(439,269)		(1,161)
Present value of lease liabilities	$	1,005,965	$	6,917

The weighted-average lease terms and discount rates of operating and finance leases were as follows:


	January 1, 2022		January 2, 2021
Weighted-average remaining lease term:
Operating leases	11.6 years		12.0 years
Finance leases	5.8 years		6.7 years
Weighted-average discount rate:
Operating leases	6.46	%	6.91	%
Finance leases	5.36	%	6.08	%

Supplemental cash flow information related to leases was as follows (amounts in thousands):


	Fiscal Year Ended
	January 1, 2022		January 2, 2021		December 28, 2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	113,886	$	101,245	$	88,362
Operating cash flows from finance leases	$	378	$	378	$	337
Finance cash flows from finance leases	$	1,155	$	821	$	675
Leased assets obtained in exchange for new lease liabilities — adoption	$	—	$	—	$	664,882
Leased assets obtained in exchange for new operating lease liabilities	$	139,663	$	166,018	$	155,986
Leased assets obtained in exchange for new finance lease liabilities	$	2,019	$	883	$	—

Leases

The balance sheet classification of our right-of-use lease assets and lease liabilities was as follows (amounts in thousands):


Leases	Classification	January 1, 2022		January 2, 2021
Assets:
Operating lease assets	Operating right-of-use assets	$	898,152	$	835,397
Finance lease assets	Other assets	6,896		5,973
Total lease assets		$	905,048	$	841,370
Liabilities:
Current
Operating	Current lease liabilities	$	49,861	$	47,730
Finance	Current lease liabilities	1,275		945
Noncurrent
Operating	Long-term lease liabilities	956,104		876,329
Finance	Long-term lease liabilities	5,642		5,109
Total lease liabilities		$	1,012,882	$	930,113

The components of lease expense were as follows (amounts in thousands):


		Fiscal Year Ended
Lease Cost	Classification (1)	January 1, 2022		January 2, 2021		December 28, 2019
Operating lease cost	Selling, general and administrative expenses	$	123,799	$	112,096	$	99,237
Finance lease cost:
Amortization of right-of-use assets	Depreciation and amortization	1,249		964		817
Interest on leased liabilities	Interest expense, net	378		376		263
Variable lease cost	Selling, general and administrative expenses	547		700		668

Sublease income	Selling, general and administrative expenses	(1,114)		(972)		(1,248)
Net lease cost		$	124,859	$	113,164	$	99,737

_______________________

(1)Certain supply chain related lease costs herein are included in cost of sales.

Maturities of lease liabilities as of January 1, 2022 were as follows (amounts in thousands):


	Operating Leases		Finance Leases		Total
Fiscal 2022	$	113,191	$	1,605	$	114,796
Fiscal 2023	126,143		1,503		127,646
Fiscal 2024	125,713		1,438		127,151
Fiscal 2025	124,371		1,207		125,578
Fiscal 2026	123,687		839		124,526
Thereafter	832,129		1,486		833,615
Total lease payments	1,445,234		8,078		$	1,453,312
Less: Imputed interest	(439,269)		(1,161)
Present value of lease liabilities	$	1,005,965	$	6,917

The weighted-average lease terms and discount rates of operating and finance leases were as follows:


	January 1, 2022		January 2, 2021
Weighted-average remaining lease term:
Operating leases	11.6 years		12.0 years
Finance leases	5.8 years		6.7 years
Weighted-average discount rate:
Operating leases	6.46	%	6.91	%
Finance leases	5.36	%	6.08	%

Supplemental cash flow information related to leases was as follows (amounts in thousands):


	Fiscal Year Ended
	January 1, 2022		January 2, 2021		December 28, 2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	113,886	$	101,245	$	88,362
Operating cash flows from finance leases	$	378	$	378	$	337
Finance cash flows from finance leases	$	1,155	$	821	$	675
Leased assets obtained in exchange for new lease liabilities — adoption	$	—	$	—	$	664,882
Leased assets obtained in exchange for new operating lease liabilities	$	139,663	$	166,018	$	155,986
Leased assets obtained in exchange for new finance lease liabilities	$	2,019	$	883	$	—

Goodwill and Intangible Assets

12 Months Ended

Jan. 01, 2022

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Intangible Assets

Information regarding our goodwill and intangible assets as of January 1, 2022 was as follows (amounts in thousands):


	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
Trademarks	$	58,400	$	(28,111)	$	30,289

Computer software	34,108		(20,758)		13,350
Total finite-lived intangible assets	92,508		(48,869)		43,639
Liquor licenses	8,282		—		8,282
Total intangible assets	100,790		(48,869)		51,921
Goodwill	747,943		—		747,943
Total goodwill and intangible assets	$	848,733	$	(48,869)	$	799,864

Information regarding our goodwill and intangible assets as of January 2, 2021 was as follows (amounts in thousands):


	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
Trademarks	$	58,400	$	(24,218)	$	34,182

Computer software	24,868		(18,368)		6,500
Total finite-lived intangible assets	83,268		(42,586)		40,682
Liquor licenses	7,544		—		7,544
Total intangible assets	90,812		(42,586)		48,226
Goodwill	747,943		—		747,943
Total goodwill and intangible assets	$	838,755	$	(42,586)	$	796,169

Amortization expense for finite-lived intangible assets was $6.6 million, $6.5 million, and $6.7 million for the fiscal years ended January 1, 2022, January 2, 2021, and December 28, 2019, respectively.

The estimated future amortization expense related to finite-lived intangible assets as of January 1, 2022 is as follows (amounts in thousands):


Fiscal 2022	$	7,085
Fiscal 2023	6,771
Fiscal 2024	5,802
Fiscal 2025	4,653
Fiscal 2026	4,653
Thereafter	14,675
Total	$	43,639

Long-term Debt

12 Months Ended

Jan. 01, 2022

Debt Disclosure [Abstract]

Long-term Debt

Long-term debt consisted of the following (amounts in thousands):


	January 1, 2022		January 2, 2021
First Lien Credit Agreement:
Term loan	$	460,000	$	460,000


Long-term debt, gross	460,000		460,000
Less: Unamortized debt discounts and debt issuance costs	(8,532)		(10,767)


Long-term debt, net	$	451,468	$	449,233

First Lien Credit Agreement

GOBP Holdings, our wholly owned subsidiary, together with another of our wholly owned subsidiaries, has a first lien credit agreement (the "First Lien Credit Agreement") with a syndicate of lenders that consists of a $460.0 million senior term loan and a revolving credit facility for an amount up to $100.0 million, with sub-commitments for a $35.0 million letter of credit and $20.0 million of swingline loans as of January 1, 2022. The First Lien Credit Agreement permits voluntary prepayment on borrowings without premium or penalty. Borrowings under the First Lien Credit Agreement are secured by substantially all the assets of the borrower subsidiary and its guarantors.

Term Loan

Our $460.0 million senior term loan matures on October 22, 2025 and had an interest rate of 2.85% as of January 1, 2022. Due to previous prepayments on the term loan, no further principal payment on the term loan will be due until the maturity date. The terms of the First Lien Credit Agreement include mandatory prepayment requirements on the term loan if certain conditions are met (as described in the First Lien Credit Agreement).

On January 24, 2020, GOBP Holdings together with another of our wholly owned subsidiaries, entered into a second incremental agreement (the "Second Incremental Agreement") which amended a previous incremental agreement (the "First Incremental Agreement"). The Second Incremental Agreement refinanced a previous replacement term loan under the First Incremental Agreement with a replacement $460.0 million senior secured term loan (the "Second Replacement Term Loan") with an applicable margin of 2.75% for Eurodollar loans and 1.75% for base rate loans, in each case depending on the public corporate family rating of GOBP Holdings, and made certain other corresponding technical changes and updates to the First Incremental Agreement. We wrote off debt issuance costs of $0.1 million and incurred debt modification costs of $0.1 million during the first quarter of fiscal 2020 in connection with this refinance.

Other than as described above, the Second Replacement Term Loan has the same terms as provided under the original First Lien Credit Agreement and the First Incremental Agreement. Additionally, the parties to the Second Incremental Agreement continue to have the same obligations set forth in the original First Lien Credit Agreement and the First Incremental Agreement.

Revolving Credit Facility

As of January 1, 2022, we had $3.5 million of outstanding standby letters of credit and $96.5 million of remaining borrowing capacity available under the revolving credit facility. No amounts were outstanding under the revolving credit facility as of January 1, 2022 and January 2, 2021.

We are required to pay a quarterly commitment fee ranging from 0.25% to 0.50% on the daily unused amount of the commitment under the revolving credit facility based upon the leverage ratio defined in the agreement and certain criteria specified in the agreement. We are also required to pay fronting fees and other customary fees for letters of credit issued under the revolving credit facility. The interest rate for the revolving credit facility is determined based on a formula using certain market rates.

On March 19, 2020, we borrowed $90.0 million under the revolving credit facility of our First Lien Credit Agreement (the "Revolving Credit Facility Loan"), the proceeds of which were to be used as reserve funding for working capital needs as a precautionary measure in light of the economic uncertainty surrounding the COVID-19 pandemic. On May 26, 2020, we repaid the Revolving Credit Facility Loan in full. No amounts were borrowed under the Revolving Credit Facility Loan during the fiscal year ended January 1, 2022.

Debt Covenants

The First Lien Credit Agreement contains certain customary representations and warranties, subject to limitations and exceptions, and affirmative and customary covenants. The First Lien Credit Agreement restricts us from entering into certain types of transactions and making certain types of payments including dividends and stock repurchase and other similar distributions, with certain exceptions. Additionally, borrowing availability under the revolving credit facility under our First Lien Credit Agreement is subject to a first lien secured leverage ratio (as defined in the First Lien Credit Agreement) of 7.00 to 1.00, tested quarterly if, and only if, the aggregate principal amount outstanding and/or issued, as applicable, from the revolving facility, letters of credit (to the extent not cash collateralized or backstopped or, in the aggregate, not in excess of the greater of $10.0 million and the stated face amount of letters of credit outstanding on the closing date) and swingline loans exceeds 35% of the total amount of the revolving credit facility commitments (as defined in the First Lien Credit Agreement).

As of January 1, 2022, we were in compliance with all applicable financial covenant requirements for our First Lien Credit Agreement.

Schedule of Principal Maturities

Principal maturities of debt as of January 1, 2022 are as follows (amounts in thousands):


Fiscal 2022	$	—
Fiscal 2023	—
Fiscal 2024	—
Fiscal 2025	460,000
Fiscal 2026	—
Thereafter	—
Total	$	460,000

Interest Expense, Net

Interest expense, net, consisted of the following (amounts in thousands):


	Fiscal Year Ended
	January 1, 2022		January 2, 2021		December 28, 2019
Interest on loans	$	13,930	$	18,950	$	45,084
Amortization of debt issuance costs and debt discounts	2,511		2,452		2,542
Interest on finance leases	378		376		263
Other	66		32		51
Interest income	(1,321)		(1,767)		(2,013)
Interest expense, net	$	15,564	$	20,043	$	45,927

Debt Extinguishment and Modification Costs

Debt extinguishment and modification costs consisted of the following (amounts in thousands):


	Fiscal Year Ended
	January 1, 2022		January 2, 2021		December 28, 2019
Write-off of debt issuance costs	$	—	$	74	$	4,110
Debt modification costs	—		124		150
Write off of debt discounts	—		—		1,374
Debt extinguishment and modification costs	$	—	$	198	$	5,634

Stockholders' Equity	12 Months Ended
Stockholders' Equity	Jan. 01, 2022
Equity [Abstract]
Stockholders' Equity	Stockholders' Equity As of January 1, 2022, the total amount of the Company’s authorized capital stock consisted of 500,000,000 shares of common stock, par value $0.001 per share, and 50,000,000 shares of undesignated preferred stock, par value of $0.001 per share. Common Stock Holders of our common stock are entitled to one vote for each share held of record on all matters on which stockholders are entitled to vote generally, including the election or removal of directors. The holders of our common stock do not have cumulative voting rights in the election of directors. Preferred Stock We did not have any shares of preferred stock issued or outstanding as of January 1, 2022. Our Board of Directors has the authority to issue shares of preferred stock from time to time on terms it may determine, with respect to any series of preferred stock, the powers (including voting powers), preferences and relative, participating, optional and other special rights, and the qualifications, limitations or restrictions thereof as the board of directors may from time to time determine, which could affect the relative voting power or other rights of the holders of our common stock. The issuance of preferred stock could have the effect of decreasing the trading price of our common stock, restricting dividends on the common stock, diluting the voting power of our common stock, or subordinating the liquidation rights of the common stock. Dividend Rights Holders of our common stock are entitled to receive dividends when, as and if declared by our board of directors out of funds legally available therefor, subject to any statutory or contractual restrictions on the payment of dividends and to the rights of the holders or one or more outstanding series of our preferred stock. Initial Public Offering In June 2019, we completed an initial public offering ("IPO") of 19,765,625 shares of our common stock at a public offering price of $22.00 per share for net proceeds of $407.7 million, after deducting underwriting discounts and commissions of $27.1 million. We also incurred offering costs payable by us of $7.2 million. The shares of common stock sold in the IPO and the net proceeds from the IPO included the full exercise of the underwriters' option to purchase additional shares. Our Amended and Restated Certificate of Incorporation (the "Charter") became effective in connection with the completion of the IPO on June 24, 2019. The Charter, among other things, provided that all of our outstanding shares of nonvoting common stock were automatically converted into shares of voting common stock on a one-for-one basis and that our authorized capital stock consisted of 500,000,000 shares of common stock, and 50,000,000 shares of preferred stock, par value $0.001 per share. Our bylaws were also amended and restated as of June 24, 2019. Additionally, upon the closing of the IPO, we redeemed all of our outstanding preferred stock for an aggregate of $1.00. On June 24, 2019, we used the net proceeds from the IPO to repay $150.0 million in principal on the outstanding term loan under our second lien credit agreement, dated as of October 22, 2018 (as amended, the "Second Lien Credit Agreement"), as well as accrued and unpaid interest as of that date of $3.6 million, and terminated the Second Lien Credit Agreement. In addition, using the remainder of net proceeds, together with excess cash on hand, we prepaid a portion of our outstanding senior secured term loan under our First Lien Credit Agreement (as defined below) totaling $248.0 million plus accrued interest of $3.8 million. On October 23, 2019, we prepaid an additional $15.0 million of principal on the senior secured term loan under the First Lien Credit Agreement. Secondary Public Offerings On October 8, 2019, certain of our selling stockholders completed a secondary public offering of shares of our common stock. We did not receive any of the proceeds from the sale of these shares by the selling stockholders. We incurred related offering costs of $1.1 million, which we recognized in selling, general and administrative expenses ("SG&A") for fiscal 2019, and received $3.2 million in cash (excluding withholding taxes) in connection with the exercise of 451,470 options by certain stockholders participating in this secondary public offering. On February 3, 2020, certain selling stockholders completed an additional secondary public offering of shares of our common stock. We did not receive any of the proceeds from the sale of these shares by the selling stockholders. We incurred offering costs of $1.1 million, which we recognized in SG&A during fiscal 2020. We received $1.4 million in cash (excluding withholding taxes) in connection with the exercise of 191,470 options by certain stockholders participating in this secondary public offering. On April 27, 2020, certain of our selling stockholders completed another secondary public offering of shares of our common stock. We did not receive any of the proceeds from the sale of these shares by the selling stockholders. We incurred related offering costs of $1.0 million which we recognized in SG&A during fiscal 2020. We received $1.6 million in cash (excluding withholding taxes) in connection with the exercise of 269,000 options by certain stockholders participating in this secondary public offering. On May 28, 2020, the stockholder affiliated with our former private equity sponsor, Hellman and Friedman LLC (the "H&F Investor"), distributed the remainder of its holdings representing 9.6 million shares of our common stock to its equity holders. We did not receive any proceeds or incur any material costs related to this distribution. Share Repurchase Program In November 2021, our Board of Directors approved a share repurchase program. This program, effective November 5, 2021 and without an expiration date, authorized us to repurchase up to $100.0 million of our outstanding common stock utilizing a variety of methods including open market purchases, accelerated share repurchase programs, privately negotiated transactions, structured repurchase transactions and under a Rule 10b5-1 plan (which would permit shares to be repurchased when the Company might otherwise be precluded from doing so under securities laws). During the fiscal year ended January 1, 2022, we did not purchase any of our equity securities. As of January 1, 2022, we had $100.0 million of repurchase authority remaining under the share repurchase program.

- Definition

The entire disclosure for shareholders' equity comprised of portions attributable to the parent entity and noncontrolling interest, including other comprehensive income. Includes, but is not limited to, balances of common stock, preferred stock, additional paid-in capital, other capital and retained earnings, accumulated balance for each classification of other comprehensive income and amount of comprehensive income.

+ References

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+ Details

Share-based Awards

12 Months Ended

Jan. 01, 2022

Share-based Payment Arrangement [Abstract]

Share-based Awards

Share-based Incentive Plans

The Globe Holding Corp. 2014 Stock Incentive Plan (the "2014 Plan") became effective on October 21, 2014. Under the 2014 Plan, we granted stock options and RSUs to purchase shares of our common stock. Effective as of June 19, 2019, we terminated the 2014 Plan and as a result no further equity awards may be issued under the 2014 Plan. Any outstanding awards granted under the 2014 Plan will remain subject to the terms of the 2014 Plan and the applicable equity award agreements.

On June 4, 2019, our Board of Directors and stockholders approved the Grocery Outlet Holding Corp. 2019 Incentive Plan (the "2019 Plan"). A total of 4,597,862 shares of common stock were reserved for issuance under the 2019 Plan at that time. In addition, on the first day of each fiscal year beginning in fiscal 2020 and ending in fiscal 2029, the 2019 Plan provides for an annual automatic increase of the shares reserved for issuance in an amount equal to the positive difference between (i) 4% of the "outstanding common stock" (as defined in the 2019 Plan) on the last day of the immediately preceding fiscal year and (ii) the plan share reserve on the last day of the immediately preceding fiscal year, or a lesser number as determined by our Board of Directors. As of January 1, 2022, there were a total of 6,048,252 shares of common stock reserved for issuance under the 2019 Plan, which includes 501,845 shares added effective January 3, 2021 per the above noted annual automatic increase. As of January 1, 2022, there were 3,330,247 remaining shares available for issuance of new equity awards under the 2019 Plan.

Long-term incentive programs ("LTIPs") under the 2019 Plan consist of time-based RSUs and PSUs. RSUs granted under the LTIPs generally vest over one to three years. Half of the total PSUs granted under the LTIPs will vest upon the achievement of certain revenue-based performance targets ("Tranche I PSUs") and half will vest upon the achievement of certain adjusted EBITDA-based performance targets ("Tranche II PSUs") as determined by the Compensation Committee following the last day of a three-year performance period. The number of PSUs ultimately earned will equal the number of

Tranche I and Tranche II PSUs granted multiplied by the applicable percentage of actual revenue and adjusted-EBITDA performance target levels achieved, and can range from 0% to 200% of the number of PSUs granted.

Fair Value Determination

The fair value of stock option, RSU and PSU awards is determined as of the grant date. For time-based stock options, a Black-Scholes valuation model is utilized to estimate the fair value of the awards. For performance-based stock options, a Monte Carlo simulation approach implemented in a risk-neutral framework is utilized to estimate the fair value of the awards. For RSUs and PSUs, the closing price of our common stock as reported on the grant date is utilized to estimate the fair value of the awards.

The respective valuation methods resulted in weighted-average grant date fair values for time-based stock options, performance-based stock options, RSUs, and PSUs granted during fiscal 2021, 2020 and 2019 as follows:


	Fiscal Year Ended
	January 1, 2022		January 2, 2021		December 28, 2019
Time-based stock options	N/A		N/A		$	7.61
Performance-based stock options	N/A		N/A		$	5.78
RSUs	$	28.70	$	37.07	$	27.13
PSUs	$	35.45	$	36.90	N/A

We did not award any time-based or performance-based stock options during fiscal 2021 and 2020. The grant date fair value of time-based stock options awarded during fiscal 2019 was estimated using the Black-Scholes valuation model with the following weighted-average assumptions:




Exercise price	$	21.66
Volatility	30.2		%
Risk-free interest rate	1.9		%
Dividend yield	—		%
Expected term (in years)	6.8

Grant Activity

The following table summarizes stock option activity under all equity incentive plans during fiscal 2021, 2020 and 2019:


	Time-Based Stock Options			Performance-Based Stock Options
	Number of Options	Weighted-Average Exercise Price		Number of Options	Weighted-Average Exercise Price
Options outstanding as of December 29, 2018	5,798,375	$	7.53	5,795,330	$	4.40
Granted	1,363,822	21.66		99,788	17.29
Exercised	(817,051)	7.21		—	—
Forfeitures	(101,479)	12.72		(117,997)	7.15
Options outstanding as of December 28, 2019	6,243,667	$	10.57	5,777,121	$	4.57
Granted	—	—		—	—
Exercised	(2,326,219)	7.29		(3,438,470)	4.55
Forfeitures	(52,676)	20.63		(13,071)	16.47
Options outstanding as of January 2, 2021	3,864,772	$	12.42	2,325,580	$	4.54
Granted	—	—		—	—
Exercised	(538,307)	7.77		(629,386)	4.41
Forfeitures	(191,324)	19.77		—	—
Options outstanding as of January 1, 2022	3,135,141	$	12.77	1,696,194	$	4.58
Options vested and exercisable as of January 1, 2022	1,896,260	$	7.59	1,696,194	$	4.58

The total intrinsic value of time-based stock options exercised was $15.5 million, $68.7 million and $20.8 million for fiscal 2021, 2020 and 2019, respectively. Intrinsic value represents the difference between the current fair value of the underlying stock and the exercise price of the stock option.

The following table summarizes RSU activity under all equity incentive plans during fiscal 2021, 2020 and 2019:


	Number of Shares	Weighted-Average Grant Date Fair Value
Unvested balance as of December 29, 2018	80,820	$	8.80
Granted	195,135	27.13
Vested	(76,841)	18.06
Forfeitures	(8,242)	30.03
Unvested balance as of December 28, 2019	190,872	$	22.89
Granted	277,496	37.07
Vested	(115,030)	19.74
Forfeitures	(11,496)	31.78
Unvested balance as of January 2, 2021	341,842	$	35.16
Granted	669,546	28.70
Vested	(110,956)	34.64
Forfeitures	(63,936)	34.05
Unvested balance as of January 1, 2022	836,496	$	30.14

The following table summarizes PSU activity under the 2019 Plan during fiscal 2021 and 2020:


	Number of Shares	Weighted-Average Grant Date Fair Value
Unvested balance as of December 28, 2019	—	$	—
Granted (1)	272,640	36.90
Adjustment for expected performance achievement (2)	135,821	36.90
Vested	—	—
Forfeitures	(999)	36.88
Unvested balance as of January 2, 2021	407,462	$	36.90
Granted (1)	319,606	35.45
Adjustment for expected performance achievement (2)	(91,332)	35.45
Vested	—	—
Forfeitures	(59,011)	36.52
Unvested balance as of January 1, 2022 (3)	576,725	$	36.36

_______________________

(1)Represents initial grant of PSUs based on performance target level achievement of 100%.

(2)Represents the adjustment to previously granted PSUs based on performance expectations as of the end of each respective reporting period.

(3)An additional 516,976 PSUs could potentially be included if the maximum performance level of 200% is reached for all PSUs outstanding as of January 1, 2022.

Share-Based Compensation Expense

We recognize compensation expense for stock options, RSUs, and PSUs by amortizing the grant date fair value on a straight-line basis over the expected vesting period to the extent we determine the vesting of the grant is probable.

Share-based compensation expense consisted of the following (amounts in thousands):


	Fiscal Year Ended
	January 1, 2022		January 2, 2021		December 28, 2019
Time-based stock options	$	2,030	$	2,941	$	25,740
Performance-based stock options	—		26,079		—
RSUs	8,488		4,978		2,054
PSUs	6,911		3,652		—
Dividends (1)	186		434		3,645
Share-based compensation expense	$	17,615	$	38,084	$	31,439

_______________________

(1)Represents cash dividends paid upon vesting of share-based awards as a result of dividends declared in connection with recapitalizations that occurred in fiscal 2018 and 2016.

Share-based compensation expense qualifying for capitalization was insignificant for each of the fiscal years ended January 1, 2022, January 2, 2021 and December 28, 2019. Accordingly, no share-based compensation expense was capitalized during these years.

Time-Based Stock Options

We did not record compensation expense for time-based stock option grants prior to the closing of our IPO in June of fiscal 2019 because such time-based options were subject to a post-termination repurchase right by us until certain contingent events such as involuntary termination, a change in control, or an initial public offering occurred, and such contingent events were not deemed probable during fiscal 2018 or any other fiscal period prior to our IPO. As a result of this repurchase right feature, other than in limited circumstances, stock issued upon the exercise of these options could be repurchased at our discretion at the lower of fair value or the applicable exercise price. The repurchase right feature lapsed upon the closing of our IPO on June 24, 2019 (the "IPO closing date"). Subsequent to the IPO closing date, we recognized share-based compensation expense for prior service completed as of the IPO closing date and began recognizing the remaining unamortized share-based compensation expense related to these outstanding time-based stock options over the remaining service period.

Unamortized compensation cost related to unvested time-based options was $3.4 million as of January 1, 2022, $3.1 million of which related to time-based stock options granted at the time of our IPO. The $3.4 million of unamortized compensation cost is expected to be amortized over a weighted average period of approximately 1.5 years.

Performance-Based Stock Options

We did not record compensation expense for performance-based stock options during the fiscal year ended December 28, 2019 because the performance criteria of such awards had not been achieved and the ultimate vesting of the awards was not considered probable as of such dates. On February 3, 2020 and April 27, 2020, certain selling stockholders completed secondary public offerings of shares of our common stock. In conjunction with these secondary offerings, certain performance criteria were achieved resulting in the vesting of 4.1 million and 1.7 million performance-based stock options, respectively, and the recognition of $18.5 million and $7.6 million, respectively, of share-based compensation expense associated with the vesting of these performance-based stock options. As of January 2, 2021, all outstanding performance-based stock options were fully vested and fully expensed and, as such, we did not record compensation expense for performance-based stock options during the fiscal year ended January 1, 2022.

Time-Based RSUs

Unamortized compensation expense for RSUs was $16.9 million as of January 1, 2022, which is expected to be amortized over a weighted average period of approximately 1.6 years.

Performance-Based RSUs

There was no share-based compensation expense for PSUs held by employees recognized for the fiscal year ended December 28, 2019 as PSUs only began being granted during fiscal 2020. Unamortized compensation cost related to the expected level of achievement of unvested PSUs was $10.4 million as of January 1, 2022, which is expected to be amortized over a weighted average period of approximately 1.5 years.

Dividends

For time-based stock options and RSUs that were outstanding on the dividend date of October 22, 2018 and that are expected to vest in fiscal year 2022 and beyond, we intend to make dividend payments as these time-based stock options and RSUs vest. Pursuant to the 2014 Plan, if we are unable to make those payments, we may instead elect to reduce the per share exercise price of each such time-based stock option by an amount equal to the dividend amount in lieu of making the applicable dividend payment. As such, our dividends are not considered declared and payable and are not accrued as a liability in our consolidated balance sheet as of January 1, 2022.

We paid $0.2 million, $0.4 million and $3.6 million of dividends during the fiscal years ended January 1, 2022, January 2, 2021, and December 28, 2019, respectively, which were included in share-based compensation expense. Unamortized compensation cost related to future dividend payments on unvested time-based stock options and RSU share-based awards was approximately $0.2 million as of January 1, 2022.

Retirement Plans	12 Months Ended
Retirement Plans	Jan. 01, 2022
Retirement Benefits [Abstract]
Retirement Plans	Retirement Plans We make payments into the UFCW—Northern California Employers Joint Pension Trust Fund (the "Pension Fund") and the UFCW—Benefits Trust Fund ("Benefits Fund"), multiemployer pension and welfare trusts, established for the benefit of union employees at two company operated stores under the terms of a collective bargaining agreement. We currently operate under a collective bargaining agreement that expires on September 6, 2022. Minimum contributions outside of the agreed upon contractual rates are not required for the Pension Fund. Payments into the Pension Fund were $0.6 million, $0.6 million, and $0.4 million for the fiscal years ended January 1, 2022, January 2, 2021, and December 28, 2019, respectively. We paid no surcharges to the Pension Fund. The risks of participating in a multiemployer pension plan are different from single-employer pension plans in the following aspects: a.Assets contributed to the multiemployer plan by one employer may be used to provide benefits to employees of other participating employers. b.If a participating employer stops contributing to the plan, the unfunded obligations of the plan may be borne by the remaining participating employers. c.If we stop participating in its multiemployer pension plan, we may be required to pay those plans an amount based on the underfunded status of the plan, referred to as a withdrawal liability. The following information represents our participation in the plan for the annual period ended December 31, 2020, the latest available information from the Pension Fund. All such information is based on information we received from the plan. The Pension Fund's Employer Identification Number and Plan Number is 946313554-001. Contributions represented less than 5% of the total contributions to the Pension Fund. Under the provisions of the Pension Protection Act (PPA) zone status, the Fund was in critical status during the plan year. Among other factors, generally, plans in critical status are less than 65 percent funded. In an effort to improve the Plan's funding situation, the trustees adopted a rehabilitation plan on July 8, 2010. The rehabilitation plan changes the benefits for participants who retire and commence a pension on or after January 1, 2012, and changes future benefit accruals earned on or after January 1, 2012. Except in limited circumstances, the pensions of participants and beneficiaries whose pension effective date is before January 1, 2012, are not affected. The Benefits Fund provides medical, dental, pharmacy, vision, and other ancillary benefits to active employees and retirees. The majority of our contributions cover active employees and as such, may not constitute contributions to a postretirement benefit plan. However, we are unable to separate contribution amounts to the postretirement benefit part of the plan from contribution amounts paid to the active employee part of the plan. Payments into the Benefits Fund were $1.4 million, $1.4 million, and $1.2 million for the fiscal years ended January 1, 2022, January 2, 2021, and December 28, 2019, respectively. For our nonunion employees, we offer the following plans: a.A defined contribution retirement plan for warehouse employees, which requires an annual contribution of 15% of eligible salaries. This defined contribution retirement plan is available to nonunion employees who meet certain service criteria. b.A noncontributory profit-sharing plan for administrative personnel under which the Board of Directors may authorize an annual contribution of up to 15% of eligible salaries. This profit-sharing plan is available to nonunion employees who meet certain service criteria. We expensed $1.5 million, $6.1 million and $4.4 million for contributions to the two plans described above in (a) and (b) for the fiscal years ended January 1, 2022, January 2, 2021, and December 28, 2019, respectively. c.A 401(k) retirement plan for warehouse employees, which is available to those employees who meet certain service criteria d.A 401(k) retirement plan for administrative personnel, which is available to those employees who meet certain service criteria. e.We are not obligated to match any employee contributions for the 401(k) retirement plans. However, for certain employees who meet certain service criteria, we have a 401(k) retirement plan under which we will match employee contributions at a rate of 35% of each participating employee's contributions, not to exceed 6% of wages. We expensed an insignificant amount for contributions to this plan for each of the fiscal years ending January 1, 2022, January 2, 2021, and December 28, 2019, respectively.

- Definition

The entire disclosure for retirement benefits.

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+ Details

Income Taxes

12 Months Ended

Jan. 01, 2022

Income Tax Disclosure [Abstract]

Income Taxes

Components of income tax expense (benefit)

Income before income taxes consisted entirely of income from domestic operations of $77.5 million, $87.1 million, and $16.8 million for the fiscal years ended January 1, 2022, January 2, 2021, and December 28, 2019, respectively.

The components of income tax expense (benefit) consisted of the following (amounts in thousands):


	Fiscal Year Ended
	January 1, 2022		January 2, 2021		December 28, 2019
Current:
Federal	$	—	$	(285)	$	52
State	2,247		284		439
Total current	2,247		(1)		491
Deferred:
Federal	10,838		(14,682)		247
State	2,106		(4,896)		625
Total deferred	12,944		(19,578)		872
Income tax expense (benefit)	$	15,191	$	(19,579)	$	1,363

Statutory rate reconciliation

A reconciliation of the U.S. federal statutory income tax rate to our effective income tax rate is as follows:


	Fiscal Year Ended
	January 1, 2022		January 2, 2021		December 28, 2019
Taxes at federal statutory rates	21.0	%	21.0	%	21.0	%

State income taxes net of federal benefit	4.7	%	(4.2)	%	5.2	%
Excess federal tax benefits from exercise and vest of share-based awards	(8.2)	%	(40.3)	%	(21.4)	%
Return to provision	1.9	%	—	%	—	%
Other	0.2	%	1.0	%	3.3	%
Effective income tax rate	19.6	%	(22.5)	%	8.1	%

Deferred income taxes

Deferred income taxes reflect the net tax effect of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes.

Significant components of our deferred tax assets and liabilities were as follows (amounts in thousands):


	January 1, 2022		January 2, 2021
Deferred tax assets:
Accrued compensation	$	1,274	$	6,362
Share-based compensation expense	10,903		8,891
Inventory	5,135		4,594
Transaction costs	964		1,152

Lease liability obligation	279,541		258,093
Net operating loss and other carryforwards	52,951		58,596
Reserves and allowances	4,446		3,092

Other	4,510		4,194
Total deferred tax assets	359,724		344,974
Deferred tax liabilities:
Prepaid expenses	(1,391)		(1,096)
Depreciation and amortization	(71,114)		(64,814)
Intangible assets	(7,142)		(7,802)
Right-of-use assets	(249,545)		(234,022)
Goodwill	(37,976)		(32,691)
Debt transaction costs	(1,972)		(1,020)
Total deferred tax liabilities	(369,140)		(341,445)
Net deferred tax assets (liabilities)	$	(9,416)	$	3,529

We have net operating loss carryforwards of $220.2 million for federal income tax purposes, of which $77.0 million expires beginning in 2032 and $143.2 million carries forward indefinitely. There are also net operating loss carryforwards of $72.4 million for state income tax purposes, which begin to expire in 2029. Certain tax attributes, which begin to expire in 2031, are subject to an annual limitation as a result of our acquisition of GOBP Holdings, our wholly owned subsidiary, which constitutes a change in ownership as defined under Internal Revenue Code Section 382. Based on our analysis, our projected net operating losses to be utilized in future years will not be affected by this annual limitation.

Management assesses the available positive and negative evidence to estimate whether sufficient future taxable income will be generated to permit the use of the existing deferred tax assets. A significant piece of objective positive evidence was the cumulative income incurred over the three-year period ended January 1, 2022. Based on our current assessment, we anticipate it is more likely than not that we will generate sufficient taxable income to realize all of our material deferred tax assets. As such we did not record a valuation allowance against these material deferred tax assets as of January 1, 2022.

Our policy is to recognize interest and penalties associated with uncertain tax positions as part of the income tax provision and include accrued interest and penalties with the related income tax liability on our consolidated balance sheets. To date, we have not recognized any interest and penalties in our condensed consolidated statements of operations and comprehensive income, nor have we accrued for or made payments for interest and penalties. We had no uncertain tax positions as of January 1, 2022 and January 2, 2021, respectively, and do not anticipate any changes to our uncertain tax positions within the next 12 months.

We are subject to taxation in the United States and various state jurisdictions. As of January 1, 2022, our tax returns remain open to examination by the tax authorities for tax years 2011 to 2021 for U.S. federal and for various state jurisdictions.

- Definition

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
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+ Details

Related Party Transactions	12 Months Ended
Related Party Transactions	Jan. 01, 2022
Related Party Transactions [Abstract]
Related Party Transactions	Related Party Transactions Related Party Leases As of January 1, 2022 and January 2, 2021, we leased 15 store locations and one warehouse location from entities in which Eric Lindberg, Jr., Chief Executive Officer, and MacGregor Read, Jr., Vice Chairman of our Board of Directors, or their respective families, had a direct or indirect material interest. As of January 1, 2022, the right-of-use assets and lease liabilities related to these properties was $36.9 million and $41.6 million, respectively. As of January 2, 2021, the right-of-use assets and lease liabilities related to these properties was $39.8 million and $44.3 million, respectively. Affiliated entities received aggregate lease payments from us of $6.1 million, $6.0 million, and $6.1 million for the fiscal years ended January 1, 2022, January 2, 2021, and December 28, 2019, respectively. Independent Operator Notes and Independent Operator Receivables We offer interest-bearing notes to IOs and the gross amount of IO operating notes and IO receivables due was $40.6 million and $41.0 million as of January 1, 2022 and January 2, 2021, respectively. See NOTE 2—Independent Operator Notes and Independent Operator Receivables, for additional information.

Commitments and Contingencies	12 Months Ended
Commitments and Contingencies	Jan. 01, 2022
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	Commitments and Contingencies We are involved from time to time in claims, proceedings, and litigation arising in the normal course of business. Management believes that we do not have any pending litigation that, separately or in the aggregate, would have a material adverse effect on our results of operations, financial condition or cash flows.

Earnings Per Share

12 Months Ended

Jan. 01, 2022

Earnings Per Share [Abstract]

Earnings Per Share

The following table sets forth the calculation of basic and diluted earnings per share (amounts in thousands, except per share data):


	Fiscal Year Ended
	January 1, 2022		January 2, 2021		December 28, 2019
Numerator
Net income and comprehensive income	$	62,310	$	106,713	$	15,419
Denominator
Weighted-average shares outstanding - basic	95,725		91,818		79,044
Effect of dilutive options	3,564		6,538		2,777
Effect of dilutive RSUs	129		96		42
Weighted-average shares outstanding - diluted (1) (2)	99,418		98,452		81,863
Earnings per share:
Basic	$	0.65	$	1.16	$	0.20
Diluted	$	0.63	$	1.08	$	0.19

_______________________

(1)The diluted weighted-average shares outstanding for the fiscal year ended December 28, 2019 did not include performance-based stock options because the requisite performance criteria of such stock options had not been achieved as of that date.

On February 3, 2020, in conjunction with a secondary offering, certain performance criteria were achieved resulting in the vesting of 4.1 million performance-based stock options, and accordingly, these vested performance-based stock options are included in the diluted weighted-average shares outstanding for fiscal year 2020.

On April 27, 2020 in conjunction with an additional secondary offering, certain performance criteria were achieved resulting in the vesting of the remaining 1.7 million unvested performance-based stock options, and accordingly, these vested performance-based stock options are included in the diluted weighted-average shares outstanding for fiscal year 2020. See NOTE 8—Share-based Awards, for additional information.

(2)We are required to include in diluted weighted-average shares outstanding contingently issuable shares that would be issued assuming the end of our reporting period was the end of the relevant PSU award contingency period. No PSUs were included in diluted weighted-average shares outstanding for fiscal years 2021 and 2020.

The following weighted-average common share equivalents were excluded from the calculation of diluted earnings per share because their effect would have been anti-dilutive (amounts in thousands):


	Fiscal Year Ended
	January 1, 2022	January 2, 2021	December 28, 2019
RSUs	11	3,239	50
Time-based stock options	—	—	682
Total	11	3,239	732

Schedule I—Condensed Financial Information of Registrant

12 Months Ended

Jan. 01, 2022

Condensed Financial Information Disclosure [Abstract]

Schedule I—Condensed Financial Information of Registrant

GROCERY OUTLET HOLDING CORP.

CONDENSED BALANCE SHEETS

(PARENT COMPANY ONLY)

(in thousands, except share and per share amounts)


	January 1, 2022		January 2, 2021
Assets



Investment in wholly owned subsidiary	$	1,011,033	$	923,816
Total assets	$	1,011,033	$	923,816
Liabilities and Stockholders' Equity
Intercompany payable	$	1,761	$	1,509
Total liabilities	1,761		1,509
Stockholders' equity:
Capital stock:
Voting common stock, par value $0.001 per share, 500,000,000 shares authorized; 96,144,433 and 94,854,336 shares issued and outstanding, respectively	96		95
Series A Preferred stock, par value $0.001 per share, 50,000,000 shares authorized; no shares issued and outstanding	—		—
Additional paid-in capital	811,701		787,047
Retained earnings	197,475		135,165
Total stockholders' equity	1,009,272		922,307
Total liabilities and stockholders' equity	$	1,011,033	$	923,816

See Notes to Condensed Financial Statements (Parent Company Only)

GROCERY OUTLET HOLDING CORP.

CONDENSED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME

(PARENT COMPANY ONLY)

(in thousands)


	Fiscal Year Ended
	January 1, 2022		January 2, 2021		December 28, 2019
Operating expenses	$	251	$	265	$	273
Operating loss	(251)		(265)		(273)
Loss before equity in net income of subsidiary	(251)		(265)		(273)
Equity in net income of subsidiary, net of tax	62,561		106,978		15,692
Net income and comprehensive income	$	62,310	$	106,713	$	15,419

See Notes to Condensed Financial Statements (Parent Company Only)

GROCERY OUTLET HOLDING CORP.

CONDENSED STATEMENTS OF CASH FLOWS

(PARENT COMPANY ONLY)

(in thousands)


	Fiscal Year Ended
	January 1, 2022		January 2, 2021		December 28, 2019
Cash flows from operating activities:
Net income	$	62,310	$	106,713	$	15,419
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Equity in net income of subsidiary	(62,561)		(106,978)		(15,692)

Changes in operating assets and liabilities:
Other current assets	—		—		497
Net cash provided by (used in) operating activities	(251)		(265)		224
Cash flows from investing activities:
Investment in subsidiary	(7,226)		(32,121)		(402,050)

Net cash used in investing activities	(7,226)		(32,121)		(402,050)
Cash flows from financing activities:
Intercompany payables	251		265		(409)
Proceeds from initial public offering, net of underwriting discounts	—		—		407,666
Proceeds from exercise of share-based compensation awards	7,226		32,604		4,444
Payments related to net settlement of share-based compensation awards	—		(483)		(2,813)
Other direct costs paid related to the initial public offering	—		—		(7,062)

Net cash provided by financing activities	7,477		32,386		401,826
Net increase (decrease) in cash and cash equivalents	—		—		—
Cash and cash equivalents at beginning of period	—		—		—
Cash and cash equivalents at end of period	$	—	$	—	$	—

See Notes to Condensed Financial Statements (Parent Company Only)

GROCERY OUTLET HOLDING CORP.

NOTES TO CONDENSED FINANCIAL STATEMENTS (PARENT COMPANY ONLY)

NOTE 1—Description of Grocery Outlet Holding Corp.

Grocery Outlet Holding Corp. (the "Parent Company") owns 100% of Globe Intermediate Corp. ("Intermediate"), which owns 100% of GOBP Holdings, Inc. ("GOBP Holdings"), which owns 100% of GOBP Midco, Inc. ("Midco"), which owns 100% of Grocery Outlet Inc. ("GOI"). GOI is a high-growth, extreme value retailer of quality, name-brand consumables and fresh products sold through a network of independently operated stores.

The Parent Company was incorporated in Delaware on September 11, 2014 and became the ultimate parent of GOI on October 7, 2014. The Parent Company has no operations or significant assets or liabilities other than its investment in Intermediate. Accordingly, the Parent Company is dependent upon distributions from Intermediate to fund its limited, non-significant operating expenses. However, GOBP Holdings' and GOI's ability to pay dividends or lend to Intermediate or the Parent Company is limited under the terms of various debt agreements.

Intermediate and GOBP Holdings are parties to credit facilities that contain covenants limiting the Parent Company's ability and the ability of its restricted subsidiaries to, among other things: pay dividends or distributions, repurchase equity, prepay junior debt and make certain investments; incur additional debt or issue certain disqualified stock and preferred stock; incur liens on assets; merge or consolidate with another company or sell all or substantially all assets; enter into transactions with affiliates; and enter into agreements that would restrict its subsidiaries to pay dividends or make other payments to the Parent Company. Due to the aforementioned qualitative restrictions, substantially all of the assets of the Parent Company's subsidiaries are restricted. These covenants are subject to important exceptions and qualifications as described in such credit facilities.

NOTE 2—Basis of Presentation

The accompanying condensed financial statements (parent company only) include the accounts of the Parent Company and its investment in Intermediate, accounted for in accordance with the equity method, and do not present the financial statements of the Parent Company and its subsidiary on a consolidated basis. These parent company only financial statements should be read in conjunction with the Parent Company's consolidated financial statements and notes thereto, included elsewhere in this Annual Report on Form 10-K.

NOTE 3—Initial Public Offering and Secondary Offerings

In June 2019, we completed an initial public offering ("IPO") of 19,765,625 shares of our common stock at a public offering price of $22.00 per share for net proceeds of $407.7 million, after deducting underwriting discounts and commissions of $27.1 million. We also incurred offering costs payable by us of $7.2 million. The shares of common stock sold in the IPO and the net proceeds from the IPO included the full exercise of the underwriters' option to purchase additional shares.

On October 8, 2019, certain of our selling stockholders completed a secondary public offering of shares of our common stock. We did not receive any of the proceeds from the sale of these shares by the selling stockholders. We incurred offering costs payable by us of $1.1 million which are included in selling, general and administrative expenses ("SG&A") for fiscal 2019. We received $3.2 million in cash (excluding withholding taxes) in connection with the exercise of 451,470 options by certain stockholders participating in this secondary public offering.

On February 3, 2020, certain selling stockholders completed an additional secondary public offering of shares of our common stock. We did not receive any of the proceeds from the sale of these shares by the selling stockholders. We incurred offering costs of $1.1 million, which were recognized in SG&A expenses during fiscal 2020. We received $1.4 million in cash (excluding withholding taxes) in connection with the exercise of 191,470 options by certain stockholders participating in this secondary public offering.

On April 27, 2020, certain of our selling stockholders completed another secondary public offering of shares of our common stock. We did not receive any of the proceeds from the sale of these shares by the selling stockholders. We incurred related offering costs of $1.0 million which we recognized in SG&A expenses during fiscal 2020. We received $1.6 million in cash (excluding withholding taxes) in connection with the exercise of 269,000 options by certain stockholders participating in this secondary public offering.

On May 28, 2020, the stockholder affiliated with our former private equity sponsor, Hellman and Friedman LLC, distributed the remainder of its holdings representing 9.6 million shares of our common stock to its equity holders. We did not receive any proceeds or incur any material costs related to this distribution.

Organization and Summary of Significant Accounting Policies (Policies)	12 Months Ended
	Jan. 01, 2022
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Basis of Presentation	The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP") and the applicable rules and regulations of the U.S. Securities and Exchange Commission (the "SEC"). Our consolidated financial statements include the accounts of Grocery Outlet Holding Corp. and its wholly owned subsidiaries. All intercompany balances and transactions were eliminated. In the opinion of management, these consolidated financial statements include all adjustments, consisting of normal recurring adjustments, necessary for a fair statement of the results for the periods presented. Certain prior period amounts in the notes to the consolidated financial statements have been reclassified to conform to the current period presentation. The reclassification of these items had no impact on net income, earnings per share, or retained earnings in the current or prior period.
Use of Estimates	The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results can differ from these estimates depending upon certain risks and uncertainties. Changes in these estimates are recorded when known.
Segment Reporting	We manage our business as one operating segment. All of our sales were made to customers located in the United States and all property and equipment is located in the United States.
Cash and Cash Equivalents	We consider all highly liquid investments, purchased with original maturities of three months or less, to be cash equivalents. All cash equivalents are unrestricted and available for immediate use.
Allowance for Independent Operator (“IO”) Receivables and Notes and Other Accounts Receivable	We maintain allowances and accruals for estimated losses of amounts advanced to IOs and other third parties determined to be uncollectible. See NOTE 2—Independent Operator Notes and Independent Operator Receivables, for additional information.
Concentration of Credit Risk	Financial instruments which potentially subject us to concentrations of credit risk consist primarily of cash and cash equivalents and accounts and notes receivable. Although we deposit our cash with creditworthy financial institutions, our deposits typically exceed federally insured limits. To date, we have not experienced any losses on our cash deposits. No single customer or store represented more than 10% of net sales for the fiscal years ended January 1, 2022, January 2, 2021 and December 28, 2019. No single customer or IO represented more than 10% of accounts receivable or notes receivable as of January 1, 2022 and January 2, 2021.
Merchandise Inventories	Merchandise inventories are valued at the lower of cost or net realizable value. Cost is determined by the weighted-average cost method for warehouse inventories and the retail inventory method for store inventories. We provide for estimated inventory losses between physical inventory counts based on historical averages. This provision is adjusted periodically to reflect the actual shrink results of the physical inventory counts.
Property and Equipment	Property and equipment is stated at cost less accumulated depreciation and includes expenditures for significant improvements to leased premises. Depreciation of property and equipment is calculated using the straight-line method over the estimated useful lives of the assets, generally ranging from three to 15 years. Amortization of leasehold improvements is calculated based on the shorter of their estimated useful life or the remaining terms of the lease. Remaining lease terms currently range from one to 17 years.We evaluate events and changes in circumstances that could indicate carrying amounts of long-lived assets, including property and equipment, may not be recoverable. When such events or changes in circumstances occur, we assess the recoverability of long-lived assets by determining whether or not the carrying value of such assets will be recovered through undiscounted future cash flows derived from their use and eventual disposition. For purposes of this assessment, long-lived assets are grouped with other assets and liabilities at the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities, primarily at an individual store level. If the sum of the undiscounted future cash flows is less than the carrying amount of an asset, we record an impairment loss for the amount by which the carrying amount of the asset exceeds its fair value. The total amount of property and equipment, including store assets, and operating lease right-of-use assets as of January 1, 2022 were $499.4 million and $898.2 million, respectively. The estimated fair value of the asset or asset group is based on the estimated discounted future cash flows of the asset or asset group using a discount rate commensurate with the related risk. There were no adjustments to the carrying value of long-lived assets due to impairment charges during fiscal 2021 and 2020. We recorded impairment charges of $0.5 million during fiscal 2019
Leases	We determine if an arrangement is a lease at inception. Operating leases are included in operating lease right-of-use assets, current lease liabilities, and long-term lease liabilities on our consolidated balance sheets. Finance leases are included in other assets, current lease liabilities, and long-term lease liabilities on our consolidated balance sheets. Right-of-use assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease over the same term. Right-of-use assets and liabilities are recognized at commencement date based on the present value of the lease payments over the lease term, reduced by landlord incentives. As most of our leases do not provide an implicit rate, we use our incremental borrowing rate, which is estimated to approximate the interest rate on a collateralized basis with similar terms and payments based on the information available at the commencement date to determine the present value of our lease payments. Lease term is defined as the non-cancelable period of the lease plus any options to extend or terminate the lease when it is reasonably certain that we will exercise the option. Lease expense for operating lease payments is recognized on a straight-line basis over the lease term while finance lease payments are charged to interest expense and depreciation and amortization expense over the lease term. Leases with an initial term of 12 months or less are not recorded on the balance sheet; lease expense for these short-term leases is recognized on a straight-line basis over the lease term.We generally lease retail facilities for store locations, distribution centers, office space and equipment and account for these leases as operating leases. We account for one retail store lease and certain equipment leases as finance leases. Lease and non-lease components are accounted for separately. We sublease certain real estate to unrelated third parties under non-cancelable leases and the sublease portfolio consists of operating leases for retail stores.
Goodwill and Other Intangible Assets	We have both goodwill and intangible assets recorded on our consolidated balance sheets. Goodwill represents the difference between the purchase price and the fair value of assets and liabilities acquired in a business combination. Goodwill is not amortized, but rather is subject to an annual impairment evaluation which is performed during our fourth quarter or when events or changes in circumstances indicate that the value of goodwill may be impaired. Our impairment evaluation of goodwill consists of an initial qualitative assessment of our reporting unit to determine whether it is more-likely-than-not that the fair value of the reporting unit is less than its carrying value. If it is concluded that this is the case, a quantitative evaluation, based on discounted cash flows, is performed which requires us to estimate future cash flows, growth rates and economic and market conditions. If the quantitative evaluation indicates that goodwill is not recoverable, an impairment loss is calculated and recognized during that period. Measurement of such an impairment loss would be based on the excess of the carrying amount over fair value. There were no goodwill impairment charges recorded during the fiscal years ended January 1, 2022, January 2, 2021 and December 28, 2019. There were no changes in the carrying amount of goodwill for the fiscal years ended January 1, 2022, January 2, 2021, and December 28, 2019. Intangible assets include trademarks, computer software, and liquor licenses. Trademarks represent the value of all our trademarks and trade names in the marketplace. We are amortizing the value assigned to the trade names on a straight-line basis over 15 years. Computer software includes both acquired software and eligible costs to develop internal-use software that are incurred during the application development stage. These assets are amortized over their estimated useful lives of three to 10 years. Liquor license assets have been classified as indefinite-lived intangible assets and accordingly, are not subject to amortization. We review our intangible assets for impairment when events or changes in circumstances indicate that the carrying amount may not be recoverable. If the carrying amount of the intangible assets are not recoverable, the impairment is measured as the amount by which the carrying value of the intangible asset exceeds its fair value.
Fair Value Measurements	Fair value is defined as the exchange price, or exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. The fair value of financial instruments is categorized based upon the level of judgment associated with the inputs used to measure their fair values. Fair value is measured using inputs from the three levels of the fair value hierarchy, which are described as follows: Level 1 — Quoted prices in active markets for identical assets or liabilities Level 2 — Quoted prices for similar assets and liabilities in active markets or inputs that are observable Level 3 — Unobservable inputs in which there is little or no market data, which requires us to develop our own assumptions when pricing the financial instruments, such as cash flow modeling assumptions. The assets' or liabilities' fair value measurement level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. The fair value framework requires that we maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. There were no assets or liabilities measured at fair value on a recurring basis as of January 1, 2022 or January 2, 2021. Generally, assets are recorded at fair value on a nonrecurring basis as a result of impairment charges. See NOTE 3—Property and Equipment and NOTE 5—Goodwill and Intangible Assets, for additional information. There were no transfers of assets or liabilities between levels within the fair value hierarchy during the fiscal years ended January 1, 2022 or January 2, 2021. Our financial assets and liabilities are carried at cost, which generally approximates their fair value, as described below: Cash and cash equivalents, IO receivables, other accounts receivable and accounts payable — The carrying value of such financial instruments approximates their fair value due to factors such as their short-term nature or their variable interest rates. IO notes receivable (net) — The carrying value of such financial instruments approximates their fair value due to the effect of the related allowance for expected credit losses.
Revenue Recognition	Net Sales — We recognize revenue from the sale of products at the point of sale, net of any taxes or deposits collected and remitted to governmental authorities. For e-commerce related sales in which a third-party company provides home delivery service, revenue is recognized upon delivery to the customer. Our performance obligations are satisfied upon the transfer of goods to the customer, at the point of sale, and payment from customers is also due at the time of sale. Discounts provided to customers by us are recognized at the time of sale as a reduction in sales as the products are sold. Discounts provided by IOs are not recognized as a reduction in sales as these are provided solely by the IO who bears the incremental costs arising from the discount. We do not accept manufacturer coupons. We do not have any material contract assets or receivables from contracts with customers, any revenue recognized in the current year from performance obligations satisfied in previous periods, any performance obligations, or any material costs to obtain or fulfill a contract as of January 1, 2022 and January 2, 2021. Gift Cards — We record a deferred revenue liability when a Grocery Outlet gift card is sold. Revenue related to gift cards is recognized as the gift cards are redeemed, which is when we have satisfied our performance obligation. While gift cards are generally redeemed within 12 months, some are never fully redeemed. We reduce the liability and recognize revenue for the unused portion of the gift cards ("breakage") under the proportional method, where recognition of breakage income is based upon the historical run-off rate of unredeemed gift cards.Cost of sales includes, among other things, merchandise costs, inventory markdowns, shrink and transportation, third-party delivery fees and distribution and warehousing costs, including depreciation.
Marketing and Advertising Expenses	Costs for store promotions, newspaper, television, radio and other media advertising are expensed at the time the promotion or advertising takes place. Advertising costs are included in SG&A in the accompanying consolidated statements of operations and comprehensive income
Share-based Awards	We estimate the fair value of time-based stock option awards subject to only a service condition on the date of grant using the Black-Scholes valuation model. The Black-Scholes model requires the use of certain input assumptions. Because we completed our IPO during fiscal 2019, for awards granted in fiscal 2019 we had limited historical exercise data from which to derive such input assumptions, including an option's expected term and the price volatility of the underlying stock. Consequently, we determined the expected term using an accepted, simplified formula which derives an expected term by taking the sum of the contractual term and adding the length of the vesting period and dividing by two. We estimated stock price volatility for our common stock by taking the average historic price volatility for industry peers based on daily price observations over a period equivalent to the expected term of the stock option grants. Industry peers consist of several public companies in our industry which are of similar size, complexity and stage of development. The risk-free interest rate for the expected term of the option was based on the U.S. Treasury implied yield at the date of grant. We did not award any time-based or performance-based stock options during fiscal 2021 and 2020. We estimate the fair value of performance-based stock option awards subject to both a market condition and a performance condition on the date of grant using a Monte Carlo simulation approach implemented in a risk-neutral framework. We estimate the fair value of restricted stock units ("RSUs") and performance-based restricted stock units ("PSUs") based upon the closing price of our common stock as reported on the Nasdaq Global Select Market on the date of grant. The PSUs vest in one installment after a three year performance period based on the achievement of cumulative operating goals. We recognize compensation expense for share-based payment awards with only a service condition on a straight-line basis over the requisite service period, which is generally the award's vesting period. Vesting of these awards would be accelerated for certain employees in the event of a change in control as well as certain termination events. Compensation expense for share-based payment awards subject to vesting based upon the achievement of a performance condition is recognized on a graded-vesting basis at the time the achievement of the performance condition becomes probable. We recognize share-based award forfeitures as they occur rather than estimating by applying a forfeiture rate. While we recognize share-based compensation expense over the performance period and/or requisite service period based on the fair market value of the award as of the grant date, we will not know the actual amount of tax benefit an award will generate until such award is exercised (or vested for RSUs or PSUs)). Until such award is exercised (or vested for RSUs or PSUs) we assume that the amount ultimately recognized for tax purposes is the same amount we are currently recognizing in our operating results, that is for "book" purposes. Consequently, our deferred tax asset related to share-based compensation expense, which totaled $10.9 million as of January 1, 2022, is based on each qualifying award's grant date fair value rather than the award's to-be-determined exercise date intrinsic value (or vesting date fair value). For awards exercised (or vested for RSUs) during our fiscal year ended January 1, 2022, the difference between the grant date fair value and the exercise or vest date intrinsic value totaled $30.3 million. If the share price for our common stock were to depreciate for a sustained period of time, we could be required to recognize a tax shortfall. Such shortfalls could have a material effect on our cash flows and financial results.
Income Taxes	Income taxes are accounted for using an asset and liability approach that requires recognition of deferred tax assets and liabilities for expected future tax consequences of events that have been recognized in our consolidated financial statements or tax returns. In estimating future tax consequences, all expected future events are considered, other than changes in the tax law. A valuation allowance is established, when necessary, to reduce net deferred income tax assets to the amount expected to be realized. We have not recorded any valuation allowances against our deferred income tax balances for the fiscal years ended January 1, 2022 and January 2, 2021. Significant items comprising our future tax benefits and liabilities (deferred tax assets and liabilities) include net operating losses, depreciation and amortization, goodwill, intangible assets, lease liability obligations and right-of-use assets.We recognize interest and penalties accrued on any unrecognized tax benefits as a component of income tax expense. We record uncertain tax positions in accordance with ASC Topic 740, Income Taxes, on the basis of a two-step process in which (i) we determine whether it is more likely than not that the tax positions will be sustained on the basis of the technical merits of the position and (ii) for those tax positions that meet the more likely-than-not recognition threshold, we recognize the largest amount of tax benefit that is more than 50 percent likely to be realized upon ultimate settlement with the related tax authority.
Variable Interest Entities	In accordance with the variable interest entities sub-section of ASC Topic 810, Consolidation, we assess at each reporting period whether we, or any consolidated entity, are considered the primary beneficiary of a variable interest entity ("VIE") and therefore required to consolidate the financial results of the VIE in our consolidated financial statements. Determining whether to consolidate a VIE may require judgment in assessing (i) whether an entity is a VIE, and (ii) if a reporting entity is a VIE's primary beneficiary. A reporting entity is determined to be a VIE's primary beneficiary if it has the power to direct the activities that most significantly impact a VIE's economic performance and the obligation to absorb losses or rights to receive benefits that could potentially be significant to a VIE. We had 411, 375 and 342 stores operated by IOs as of January 1, 2022, January 2, 2021 and December 28, 2019, respectively. We have agreements in place with each IO. The IO orders merchandise exclusively from us which is provided to the IO on consignment. Under the Independent Operator Agreement (the "Operator Agreement"), the IO may select a majority of merchandise that we consign to the IO, which the IO chooses from our merchandise order guide according to the IO's knowledge and experience with local customer purchasing trends, preferences, historical sales and similar factors. The Operator Agreement gives the IO discretion to adjust our initial prices if the overall effect of all price changes at any time comports with the reputation of our Grocery Outlet retail stores for selling quality, name-brand consumables and fresh products and other merchandise at extreme discounts. IOs are required to furnish initial working capital and to acquire certain store and safety assets. The IO is also required to hire, train and employ a properly trained workforce sufficient in number to enable the IO to fulfill its obligations under the Operator Agreement. Additionally, the IO is responsible for expenses required for business operations, including all labor costs, utilities, credit card processing fees, supplies, taxes, fines, levies and other expenses. Either party may terminate the Operator Agreement without cause upon 75 days' notice. As consignor of all merchandise to each IO, the aggregate net sales proceeds from merchandise sales belongs to us. Net sales related to IO stores were $3.0 billion, $3.1 billion, and $2.5 billion for the fiscal years ended January 1, 2022, January 2, 2021, and December 28, 2019, respectively. We, in turn, pay IOs a commission based on a share of the gross profit of the store. Inventories and related net sales proceeds are our property, and we are responsible for store rent and related occupancy costs. IO commissions were expensed and included in SG&A. IO commissions were $463.8 million, $469.3 million, and $382.8 million for the fiscal years ended January 1, 2022, January 2, 2021, and December 28, 2019, respectively. IO commissions of $9.1 million and $6.0 million were included in accrued expenses as of January 1, 2022 and January 2, 2021, respectively. IOs may fund their initial store investment from existing capital, a third-party loan or most commonly through a loan from us, as further discussed in NOTE 2—Independent Operator Notes and Independent Operator Receivables. As collateral for IO obligations and performance, the Operator Agreements grant us the security interests in the assets owned by the IOs related to the respective store. Since the total investment at risk associated with each IO is not sufficient to permit each IO to finance its activities without additional subordinated financial support, the IOs are VIEs which we have variable interests in. To determine if we are the primary beneficiary of these VIEs, we evaluate whether we have (i) the power to direct the activities that most significantly impact the IO's economic performance and (ii) the obligation to absorb losses or the right to receive benefits of the IO that could potentially be significant to the IO. Our evaluation includes identification of significant activities and an assessment of its ability to direct those activities.Activities that most significantly impact the IO's economic performance relate to sales and labor. Sales activities that significantly impact the IO's economic performance include determining what merchandise the IO will order and sell and the price of such merchandise, both of which the IO controls. The IO is also responsible for all of their own labor. Labor activities that significantly impact the IO's economic performance include hiring, training, supervising, directing, compensating (including wages, salaries and employee benefits) and terminating all of the employees of the IO, activities which the IO controls. Accordingly, the IO has the power to direct the activities that most significantly impact the IO's economic performance. Furthermore, the mutual termination rights associated with the Operator Agreements illustrate the lack of ultimate control over the IO. Therefore, the Company is not the primary beneficiary of these VIEs.
Net Income Per Share	Basic net income per share is calculated using net income available to common stockholders divided by the weighted-average number of common shares outstanding during the period. Diluted net income per share reflects the dilutive effects of stock options and RSUs outstanding during the period, to the extent such securities would not be anti-dilutive, and is determined using the treasury stock method.
Recently Adopted Accounting Standards and Recently Issued Accounting Pronouncements	Recently Adopted Accounting Standards ASU No. 2019-12 —In December 2019, the FASB issued ASU No. 2019-12, Simplifying the Accounting for Income Taxes ("ASU 2019-12"). ASU 2019-12 simplifies accounting guidance for certain tax matters including franchise taxes, certain transactions that result in a step-up in tax basis of goodwill, and enacted changes in tax laws in interim periods. In addition, it eliminates a company's need to evaluate certain exceptions relating to the incremental approach for intra-period tax allocation, accounting for basis differences when there are ownership changes in foreign investments, and interim period income tax accounting for year-to-date losses that exceed anticipated losses. ASU 2019-12 is effective for fiscal years beginning after December 15, 2020, including interim periods within those fiscal years. We adopted ASU 2019-12 beginning in the first quarter of fiscal 2021. The adoption of ASU 2019-12 did not have a material impact on our consolidated financial statements. Recently Issued Accounting Pronouncements No recently issued accounting pronouncements are expected to have a material effect on our consolidated financial statements.

Organization and Summary of Significant Accounting Policies (Tables)

12 Months Ended

Jan. 01, 2022

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Financial liabilities not reported at fair value


	January 1, 2022				January 2, 2021
	Carrying Amount (1)		Estimated Fair Value (2)		Carrying Amount (1)		Estimated Fair Value (2)
Financial Liabilities:
Term loan (Level 2)	$	451,468	$	457,700	$	449,233	$	460,000

_______________________

(2)The estimated fair value of our term loan was determined based on the average quoted bid-ask prices for the term loan in an over-the-counter market on the last trading day of fiscal 2021 and 2020.

Schedule of sales revenue by product

The following table presents net sales revenue by type of product for the fiscal years ended January 1, 2022, January 2, 2021, and December 28, 2019 (amounts in thousands); e-commerce sales have been allocated to their respective product type:


	January 1, 2022		January 2, 2021		December 28, 2019
Perishable (1)	$	1,067,198	$	1,054,506	$	868,109
Non-perishable (2)	2,012,384		2,080,134		1,691,508
Total sales (3)	$	3,079,582	$	3,134,640	$	2,559,617

_______________________

(1)Perishable departments include dairy and deli; produce and floral; and fresh meat and seafood.

(2)Non-perishable departments include non-perishable grocery; general merchandise; health and beauty care; frozen foods; and beer and wine.

(3)The fiscal years ended January 1, 2022 and December 28, 2019 consisted of 52 weeks while the fiscal year ended January 2, 2021 consisted of 53 weeks.

Independent Operator Notes and Independent Operator Receivables (Tables)

12 Months Ended

Jan. 01, 2022

Receivables [Abstract]

Schedule of amounts due from independent operators

Amounts due from IOs and the related allowances as of January 1, 2022 and January 2, 2021 consisted of the following (amounts in thousands):


			Allowance						Current Portion		Long-term Portion
	Gross		Current Portion		Long-term Portion		Net
January 1, 2022
Independent operator notes	$	34,221	$	(811)	$	(10,506)	$	22,904	$	1,388	$	21,516
Independent operator receivables	6,426		(595)		—		5,831		5,831		—
Total	$	40,647	$	(1,406)	$	(10,506)	$	28,735	$	7,219	$	21,516


			Allowance						Current Portion		Long-term Portion
	Gross		Current Portion		Long-term Portion		Net
January 2, 2021
Independent operator notes	$	37,238	$	(514)	$	(7,124)	$	29,600	$	2,160	$	27,440
Independent operator receivables	3,754		(471)		—		3,283		3,283		—
Total	$	40,992	$	(985)	$	(7,124)	$	32,883	$	5,443	$	27,440

Schedule of allowance for credit loss activity

A summary of activity in the IO notes and IO receivables allowance was as follows (amounts in thousands):


	Fiscal Year Ended
	January 1, 2022		January 2, 2021		December 28, 2019
Beginning balance	$	8,109	$	10,371	$	9,067
Provision for IO notes and IO receivables	4,790		(473)		2,741
Cumulative effect of accounting change	—		(439)		—
Write-off of provision for IO notes and IO receivables	(987)		(1,350)		(1,437)
Ending balance	$	11,912	$	8,109	$	10,371

Schedule of independent operator notes by credit quality indicators and year of origination

The following table presents the amortized cost basis of IO notes by year of origination and credit quality indicator as of January 1, 2022 (amounts in thousands):


Credit Quality Indicator	2021		2020		2019		2018		2017		Prior		Total
TCAP	$	3,182	$	2,331	$	1,791	$	1,058	$	463	$	257	$	9,082
Non-TCAP	5,157		3,709		3,673		2,085		881		371		15,876
New store	6,615		2,648		—		—		—		—		9,263
Total	$	14,954	$	8,688	$	5,464	$	3,143	$	1,344	$	628	$	34,221

Property and Equipment (Tables)

12 Months Ended

Jan. 01, 2022

Property, Plant and Equipment [Abstract]

Schedule of property and equipment

Property and equipment as of January 1, 2022 and January 2, 2021 consisted of the following (amounts in thousands):


	Property and Equipment, At Cost		Accumulated Depreciation and Amortization		Property and Equipment, Net
January 1, 2022
Leasehold improvements	$	333,053	$	(92,815)	$	240,238
Fixtures and equipment	396,500		(170,487)		226,013
Other	376		(295)		81
Construction in progress	33,055		—		33,055
Totals	$	762,984	$	(263,597)	$	499,387
January 2, 2021
Leasehold improvements	$	275,586	$	(70,999)	$	204,587
Fixtures and equipment	330,338		(134,820)		195,518
Other	376		(282)		94
Construction in progress	33,453		—		33,453
Totals	$	639,753	$	(206,101)	$	433,652

Depreciation expense on property and equipment for fiscal 2021, 2020 and 2019 was as follows (amounts in thousands):


	Fiscal Year Ended
Consolidated Statements of Operations and Comprehensive Income Location	January 1, 2022		January 2, 2021		December 28, 2019
Cost of sales	$	1,486	$	1,299	$	1,210
Operating expenses	61,956		49,450		41,696
Total depreciation expense on property and equipment	$	63,442	$	50,749	$	42,906

Leases (Tables)

12 Months Ended

Jan. 01, 2022

Leases [Abstract]

Schedule of balance sheet classifications

The balance sheet classification of our right-of-use lease assets and lease liabilities was as follows (amounts in thousands):


Leases	Classification	January 1, 2022		January 2, 2021
Assets:
Operating lease assets	Operating right-of-use assets	$	898,152	$	835,397
Finance lease assets	Other assets	6,896		5,973
Total lease assets		$	905,048	$	841,370
Liabilities:
Current
Operating	Current lease liabilities	$	49,861	$	47,730
Finance	Current lease liabilities	1,275		945
Noncurrent
Operating	Long-term lease liabilities	956,104		876,329
Finance	Long-term lease liabilities	5,642		5,109
Total lease liabilities		$	1,012,882	$	930,113

Schedule of lease cost

The components of lease expense were as follows (amounts in thousands):


		Fiscal Year Ended
Lease Cost	Classification (1)	January 1, 2022		January 2, 2021		December 28, 2019
Operating lease cost	Selling, general and administrative expenses	$	123,799	$	112,096	$	99,237
Finance lease cost:
Amortization of right-of-use assets	Depreciation and amortization	1,249		964		817
Interest on leased liabilities	Interest expense, net	378		376		263
Variable lease cost	Selling, general and administrative expenses	547		700		668

Sublease income	Selling, general and administrative expenses	(1,114)		(972)		(1,248)
Net lease cost		$	124,859	$	113,164	$	99,737

_______________________

(1)Certain supply chain related lease costs herein are included in cost of sales.

Schedule of maturities of lease liabilities

Maturities of lease liabilities as of January 1, 2022 were as follows (amounts in thousands):


	Operating Leases		Finance Leases		Total
Fiscal 2022	$	113,191	$	1,605	$	114,796
Fiscal 2023	126,143		1,503		127,646
Fiscal 2024	125,713		1,438		127,151
Fiscal 2025	124,371		1,207		125,578
Fiscal 2026	123,687		839		124,526
Thereafter	832,129		1,486		833,615
Total lease payments	1,445,234		8,078		$	1,453,312
Less: Imputed interest	(439,269)		(1,161)
Present value of lease liabilities	$	1,005,965	$	6,917

Schedule of maturities of lease liabilities

Maturities of lease liabilities as of January 1, 2022 were as follows (amounts in thousands):


	Operating Leases		Finance Leases		Total
Fiscal 2022	$	113,191	$	1,605	$	114,796
Fiscal 2023	126,143		1,503		127,646
Fiscal 2024	125,713		1,438		127,151
Fiscal 2025	124,371		1,207		125,578
Fiscal 2026	123,687		839		124,526
Thereafter	832,129		1,486		833,615
Total lease payments	1,445,234		8,078		$	1,453,312
Less: Imputed interest	(439,269)		(1,161)
Present value of lease liabilities	$	1,005,965	$	6,917

Schedule of supplemental cash flow information

The weighted-average lease terms and discount rates of operating and finance leases were as follows:


	January 1, 2022		January 2, 2021
Weighted-average remaining lease term:
Operating leases	11.6 years		12.0 years
Finance leases	5.8 years		6.7 years
Weighted-average discount rate:
Operating leases	6.46	%	6.91	%
Finance leases	5.36	%	6.08	%

Supplemental cash flow information related to leases was as follows (amounts in thousands):


	Fiscal Year Ended
	January 1, 2022		January 2, 2021		December 28, 2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	113,886	$	101,245	$	88,362
Operating cash flows from finance leases	$	378	$	378	$	337
Finance cash flows from finance leases	$	1,155	$	821	$	675
Leased assets obtained in exchange for new lease liabilities — adoption	$	—	$	—	$	664,882
Leased assets obtained in exchange for new operating lease liabilities	$	139,663	$	166,018	$	155,986
Leased assets obtained in exchange for new finance lease liabilities	$	2,019	$	883	$	—

Goodwill and Intangible Assets (Tables)

12 Months Ended

Jan. 01, 2022

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of goodwill and intangible assets

Information regarding our goodwill and intangible assets as of January 1, 2022 was as follows (amounts in thousands):


	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
Trademarks	$	58,400	$	(28,111)	$	30,289

Computer software	34,108		(20,758)		13,350
Total finite-lived intangible assets	92,508		(48,869)		43,639
Liquor licenses	8,282		—		8,282
Total intangible assets	100,790		(48,869)		51,921
Goodwill	747,943		—		747,943
Total goodwill and intangible assets	$	848,733	$	(48,869)	$	799,864

Information regarding our goodwill and intangible assets as of January 2, 2021 was as follows (amounts in thousands):


	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
Trademarks	$	58,400	$	(24,218)	$	34,182

Computer software	24,868		(18,368)		6,500
Total finite-lived intangible assets	83,268		(42,586)		40,682
Liquor licenses	7,544		—		7,544
Total intangible assets	90,812		(42,586)		48,226
Goodwill	747,943		—		747,943
Total goodwill and intangible assets	$	838,755	$	(42,586)	$	796,169

Schedule of estimated future amortization expense

The estimated future amortization expense related to finite-lived intangible assets as of January 1, 2022 is as follows (amounts in thousands):


Fiscal 2022	$	7,085
Fiscal 2023	6,771
Fiscal 2024	5,802
Fiscal 2025	4,653
Fiscal 2026	4,653
Thereafter	14,675
Total	$	43,639

Long-term Debt (Tables)

12 Months Ended

Jan. 01, 2022

Debt Disclosure [Abstract]

Schedule of long-term debt

Long-term debt consisted of the following (amounts in thousands):


	January 1, 2022		January 2, 2021
First Lien Credit Agreement:
Term loan	$	460,000	$	460,000


Long-term debt, gross	460,000		460,000
Less: Unamortized debt discounts and debt issuance costs	(8,532)		(10,767)


Long-term debt, net	$	451,468	$	449,233

Principal maturities of debt

Principal maturities of debt as of January 1, 2022 are as follows (amounts in thousands):


Fiscal 2022	$	—
Fiscal 2023	—
Fiscal 2024	—
Fiscal 2025	460,000
Fiscal 2026	—
Thereafter	—
Total	$	460,000

Schedule of interest expense, net

Interest expense, net, consisted of the following (amounts in thousands):


	Fiscal Year Ended
	January 1, 2022		January 2, 2021		December 28, 2019
Interest on loans	$	13,930	$	18,950	$	45,084
Amortization of debt issuance costs and debt discounts	2,511		2,452		2,542
Interest on finance leases	378		376		263
Other	66		32		51
Interest income	(1,321)		(1,767)		(2,013)
Interest expense, net	$	15,564	$	20,043	$	45,927

Schedule of debt extinguishment and modification costs

Debt extinguishment and modification costs consisted of the following (amounts in thousands):


	Fiscal Year Ended
	January 1, 2022		January 2, 2021		December 28, 2019
Write-off of debt issuance costs	$	—	$	74	$	4,110
Debt modification costs	—		124		150
Write off of debt discounts	—		—		1,374
Debt extinguishment and modification costs	$	—	$	198	$	5,634

- Definition

Tabular disclosure of long-debt instruments or arrangements, including identification, terms, features, collateral requirements and other information necessary to a fair presentation. These are debt arrangements that originally required repayment more than twelve months after issuance or greater than the normal operating cycle of the entity, if longer.

+ References

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+ Details

Share-based Awards (Tables)

12 Months Ended

Jan. 01, 2022

Share-based Payment Arrangement [Abstract]

Schedule of respective valuation models resulted in weighted-average fair value for time-based and performance-based options and RSUs


	Fiscal Year Ended
	January 1, 2022		January 2, 2021		December 28, 2019
Time-based stock options	N/A		N/A		$	7.61
Performance-based stock options	N/A		N/A		$	5.78
RSUs	$	28.70	$	37.07	$	27.13
PSUs	$	35.45	$	36.90	N/A

Schedule of fair values of time-based options

The grant date fair value of time-based stock options awarded during fiscal 2019 was estimated using the Black-Scholes valuation model with the following weighted-average assumptions:




Exercise price	$	21.66
Volatility	30.2		%
Risk-free interest rate	1.9		%
Dividend yield	—		%
Expected term (in years)	6.8

Schedule of stock option activity

The following table summarizes stock option activity under all equity incentive plans during fiscal 2021, 2020 and 2019:


	Time-Based Stock Options			Performance-Based Stock Options
	Number of Options	Weighted-Average Exercise Price		Number of Options	Weighted-Average Exercise Price
Options outstanding as of December 29, 2018	5,798,375	$	7.53	5,795,330	$	4.40
Granted	1,363,822	21.66		99,788	17.29
Exercised	(817,051)	7.21		—	—
Forfeitures	(101,479)	12.72		(117,997)	7.15
Options outstanding as of December 28, 2019	6,243,667	$	10.57	5,777,121	$	4.57
Granted	—	—		—	—
Exercised	(2,326,219)	7.29		(3,438,470)	4.55
Forfeitures	(52,676)	20.63		(13,071)	16.47
Options outstanding as of January 2, 2021	3,864,772	$	12.42	2,325,580	$	4.54
Granted	—	—		—	—
Exercised	(538,307)	7.77		(629,386)	4.41
Forfeitures	(191,324)	19.77		—	—
Options outstanding as of January 1, 2022	3,135,141	$	12.77	1,696,194	$	4.58
Options vested and exercisable as of January 1, 2022	1,896,260	$	7.59	1,696,194	$	4.58

Schedule of RSU and PSU activity

The following table summarizes RSU activity under all equity incentive plans during fiscal 2021, 2020 and 2019:


	Number of Shares	Weighted-Average Grant Date Fair Value
Unvested balance as of December 29, 2018	80,820	$	8.80
Granted	195,135	27.13
Vested	(76,841)	18.06
Forfeitures	(8,242)	30.03
Unvested balance as of December 28, 2019	190,872	$	22.89
Granted	277,496	37.07
Vested	(115,030)	19.74
Forfeitures	(11,496)	31.78
Unvested balance as of January 2, 2021	341,842	$	35.16
Granted	669,546	28.70
Vested	(110,956)	34.64
Forfeitures	(63,936)	34.05
Unvested balance as of January 1, 2022	836,496	$	30.14

The following table summarizes PSU activity under the 2019 Plan during fiscal 2021 and 2020:


	Number of Shares	Weighted-Average Grant Date Fair Value
Unvested balance as of December 28, 2019	—	$	—
Granted (1)	272,640	36.90
Adjustment for expected performance achievement (2)	135,821	36.90
Vested	—	—
Forfeitures	(999)	36.88
Unvested balance as of January 2, 2021	407,462	$	36.90
Granted (1)	319,606	35.45
Adjustment for expected performance achievement (2)	(91,332)	35.45
Vested	—	—
Forfeitures	(59,011)	36.52
Unvested balance as of January 1, 2022 (3)	576,725	$	36.36

_______________________

(1)Represents initial grant of PSUs based on performance target level achievement of 100%.

(2)Represents the adjustment to previously granted PSUs based on performance expectations as of the end of each respective reporting period.

(3)An additional 516,976 PSUs could potentially be included if the maximum performance level of 200% is reached for all PSUs outstanding as of January 1, 2022.

Summary of share-based compensation expense

Share-based compensation expense consisted of the following (amounts in thousands):


	Fiscal Year Ended
	January 1, 2022		January 2, 2021		December 28, 2019
Time-based stock options	$	2,030	$	2,941	$	25,740
Performance-based stock options	—		26,079		—
RSUs	8,488		4,978		2,054
PSUs	6,911		3,652		—
Dividends (1)	186		434		3,645
Share-based compensation expense	$	17,615	$	38,084	$	31,439

_______________________

(1)Represents cash dividends paid upon vesting of share-based awards as a result of dividends declared in connection with recapitalizations that occurred in fiscal 2018 and 2016.

Income Taxes (Tables)

12 Months Ended

Jan. 01, 2022

Income Tax Disclosure [Abstract]

Components of income tax expense (benefit)

The components of income tax expense (benefit) consisted of the following (amounts in thousands):


	Fiscal Year Ended
	January 1, 2022		January 2, 2021		December 28, 2019
Current:
Federal	$	—	$	(285)	$	52
State	2,247		284		439
Total current	2,247		(1)		491
Deferred:
Federal	10,838		(14,682)		247
State	2,106		(4,896)		625
Total deferred	12,944		(19,578)		872
Income tax expense (benefit)	$	15,191	$	(19,579)	$	1,363

Schedule of effective income tax rate reconciliation

A reconciliation of the U.S. federal statutory income tax rate to our effective income tax rate is as follows:


	Fiscal Year Ended
	January 1, 2022		January 2, 2021		December 28, 2019
Taxes at federal statutory rates	21.0	%	21.0	%	21.0	%

State income taxes net of federal benefit	4.7	%	(4.2)	%	5.2	%
Excess federal tax benefits from exercise and vest of share-based awards	(8.2)	%	(40.3)	%	(21.4)	%
Return to provision	1.9	%	—	%	—	%
Other	0.2	%	1.0	%	3.3	%
Effective income tax rate	19.6	%	(22.5)	%	8.1	%

Components of deferred tax assets and liabilities

Significant components of our deferred tax assets and liabilities were as follows (amounts in thousands):


	January 1, 2022		January 2, 2021
Deferred tax assets:
Accrued compensation	$	1,274	$	6,362
Share-based compensation expense	10,903		8,891
Inventory	5,135		4,594
Transaction costs	964		1,152

Lease liability obligation	279,541		258,093
Net operating loss and other carryforwards	52,951		58,596
Reserves and allowances	4,446		3,092

Other	4,510		4,194
Total deferred tax assets	359,724		344,974
Deferred tax liabilities:
Prepaid expenses	(1,391)		(1,096)
Depreciation and amortization	(71,114)		(64,814)
Intangible assets	(7,142)		(7,802)
Right-of-use assets	(249,545)		(234,022)
Goodwill	(37,976)		(32,691)
Debt transaction costs	(1,972)		(1,020)
Total deferred tax liabilities	(369,140)		(341,445)
Net deferred tax assets (liabilities)	$	(9,416)	$	3,529

Earnings Per Share (Tables)

12 Months Ended

Jan. 01, 2022

Earnings Per Share [Abstract]

Schedule of earnings per share, basic and diluted

The following table sets forth the calculation of basic and diluted earnings per share (amounts in thousands, except per share data):


	Fiscal Year Ended
	January 1, 2022		January 2, 2021		December 28, 2019
Numerator
Net income and comprehensive income	$	62,310	$	106,713	$	15,419
Denominator
Weighted-average shares outstanding - basic	95,725		91,818		79,044
Effect of dilutive options	3,564		6,538		2,777
Effect of dilutive RSUs	129		96		42
Weighted-average shares outstanding - diluted (1) (2)	99,418		98,452		81,863
Earnings per share:
Basic	$	0.65	$	1.16	$	0.20
Diluted	$	0.63	$	1.08	$	0.19

_______________________

Schedule of antidilutive securities excluded from computation of earnings per share

The following weighted-average common share equivalents were excluded from the calculation of diluted earnings per share because their effect would have been anti-dilutive (amounts in thousands):


	Fiscal Year Ended
	January 1, 2022	January 2, 2021	December 28, 2019
RSUs	11	3,239	50
Time-based stock options	—	—	682
Total	11	3,239	732

Schedule I—Condensed Financial Information of Registrant (Tables)

12 Months Ended

Jan. 01, 2022

Condensed Financial Information Disclosure [Abstract]

Condensed Balance Sheets

CONDENSED BALANCE SHEETS

(PARENT COMPANY ONLY)

(in thousands, except share and per share amounts)


	January 1, 2022		January 2, 2021
Assets



Investment in wholly owned subsidiary	$	1,011,033	$	923,816
Total assets	$	1,011,033	$	923,816
Liabilities and Stockholders' Equity
Intercompany payable	$	1,761	$	1,509
Total liabilities	1,761		1,509
Stockholders' equity:
Capital stock:
Voting common stock, par value $0.001 per share, 500,000,000 shares authorized; 96,144,433 and 94,854,336 shares issued and outstanding, respectively	96		95
Series A Preferred stock, par value $0.001 per share, 50,000,000 shares authorized; no shares issued and outstanding	—		—
Additional paid-in capital	811,701		787,047
Retained earnings	197,475		135,165
Total stockholders' equity	1,009,272		922,307
Total liabilities and stockholders' equity	$	1,011,033	$	923,816

See Notes to Condensed Financial Statements (Parent Company Only)

Condensed Statements of Operations

CONDENSED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME

(PARENT COMPANY ONLY)

(in thousands)


	Fiscal Year Ended
	January 1, 2022		January 2, 2021		December 28, 2019
Operating expenses	$	251	$	265	$	273
Operating loss	(251)		(265)		(273)
Loss before equity in net income of subsidiary	(251)		(265)		(273)
Equity in net income of subsidiary, net of tax	62,561		106,978		15,692
Net income and comprehensive income	$	62,310	$	106,713	$	15,419

See Notes to Condensed Financial Statements (Parent Company Only)

Condensed Statements of Comprehensive Income

CONDENSED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME

(PARENT COMPANY ONLY)

(in thousands)


	Fiscal Year Ended
	January 1, 2022		January 2, 2021		December 28, 2019
Operating expenses	$	251	$	265	$	273
Operating loss	(251)		(265)		(273)
Loss before equity in net income of subsidiary	(251)		(265)		(273)
Equity in net income of subsidiary, net of tax	62,561		106,978		15,692
Net income and comprehensive income	$	62,310	$	106,713	$	15,419

See Notes to Condensed Financial Statements (Parent Company Only)

Condensed Statement of Cash Flows

CONDENSED STATEMENTS OF CASH FLOWS

(PARENT COMPANY ONLY)

(in thousands)


	Fiscal Year Ended
	January 1, 2022		January 2, 2021		December 28, 2019
Cash flows from operating activities:
Net income	$	62,310	$	106,713	$	15,419
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Equity in net income of subsidiary	(62,561)		(106,978)		(15,692)

Changes in operating assets and liabilities:
Other current assets	—		—		497
Net cash provided by (used in) operating activities	(251)		(265)		224
Cash flows from investing activities:
Investment in subsidiary	(7,226)		(32,121)		(402,050)

Net cash used in investing activities	(7,226)		(32,121)		(402,050)
Cash flows from financing activities:
Intercompany payables	251		265		(409)
Proceeds from initial public offering, net of underwriting discounts	—		—		407,666
Proceeds from exercise of share-based compensation awards	7,226		32,604		4,444
Payments related to net settlement of share-based compensation awards	—		(483)		(2,813)
Other direct costs paid related to the initial public offering	—		—		(7,062)

Net cash provided by financing activities	7,477		32,386		401,826
Net increase (decrease) in cash and cash equivalents	—		—		—
Cash and cash equivalents at beginning of period	—		—		—
Cash and cash equivalents at end of period	$	—	$	—	$	—

See Notes to Condensed Financial Statements (Parent Company Only)

Organization and Summary of Significant Accounting Policies - Narrative (Details)	12 Months Ended
	Jan. 01, 2022 USD ($) store wk segment retailStoreLease	Jan. 02, 2021 USD ($) store wk	Dec. 28, 2019 USD ($) store wk
Subsidiary, Sale of Stock [Line Items]
Number of stores \| store	415
Fiscal year duration in weeks \| wk	52	53	52
Number of reportable segments (in segments) \| segment	1
Number of operating segments (in segments) \| segment	1
Property and equipment, net	$ 499,387,000	$ 433,652,000
Operating lease right-of-use assets	898,152,000	835,397,000
Impairment charges	$ 0	0	$ 500,000
Number of leases \| retailStoreLease	1
Impairment of intangible assets	$ 0	0	0
Gift card, redemption period	12 months
Deferred revenue liability	$ 3,600,000	3,200,000
Advertising expense	32,600,000	25,900,000	$ 26,200,000
Deferred tax asset related to share-based compensation expense	10,903,000	$ 8,891,000
Intrinsic value of stock options exercised	$ 30,300,000
Variable interest entity, number of stores \| store	411	375	342
Net sales	$ 3,079,582,000	$ 3,134,640,000	$ 2,559,617,000
Accrued expenses	$ 49,025,000	35,699,000
Trademarks
Subsidiary, Sale of Stock [Line Items]
Useful life of intangible assets	15 years
Minimum
Subsidiary, Sale of Stock [Line Items]
Useful lives of property and equipment	3 years
Remaining lease term	1 year
Minimum \| Computer software
Subsidiary, Sale of Stock [Line Items]
Useful life of intangible assets	3 years
Maximum
Subsidiary, Sale of Stock [Line Items]
Useful lives of property and equipment	15 years
Remaining lease term	17 years
Breakage from unredeemed gift cards	$ 300,000	200,000	100,000
Maximum \| Computer software
Subsidiary, Sale of Stock [Line Items]
Useful life of intangible assets	10 years
Parent Company \| Globe Intermediate Corp.
Subsidiary, Sale of Stock [Line Items]
Ownership percentage	100.00%
Parent Company \| GOBP Holdings, Inc.
Subsidiary, Sale of Stock [Line Items]
Ownership percentage	100.00%
Parent Company \| GOBP Midco, Inc.
Subsidiary, Sale of Stock [Line Items]
Ownership percentage	100.00%
Parent Company \| Grocery Outlet Inc.
Subsidiary, Sale of Stock [Line Items]
Ownership percentage	100.00%
Variable Interest Entity, Not Primary Beneficiary
Subsidiary, Sale of Stock [Line Items]
Variable interest entity, termination period	75 days
Net sales	$ 3,000,000,000	3,100,000,000	2,500,000,000
Sales commissions and fees	463,800,000	469,300,000	$ 382,800,000
Accrued expenses	9,100,000	6,000,000
Maximum loss exposure	$ 40,600,000	$ 41,000,000

Organization and Summary of Significant Accounting Policies - Fair Value (Details) - USD ($) $ in Thousands	Jan. 01, 2022	Jan. 02, 2021
Fair Value Disclosure, Asset and Liability, Not Measured at Fair Value [Line Items]
Unamortized debt discounts	$ 1,000	$ 1,200
Debt issuance costs	7,500	9,500
Level 2 \| Gross Carrying Amount
Fair Value Disclosure, Asset and Liability, Not Measured at Fair Value [Line Items]
Term loan (Level 2)	451,468	449,233
Level 2 \| Estimated Fair Value
Fair Value Disclosure, Asset and Liability, Not Measured at Fair Value [Line Items]
Term loan (Level 2)	$ 457,700	$ 460,000

Organization and Summary of Significant Accounting Policies - Disaggregated Revenues (Details) $ in Thousands	12 Months Ended
	Jan. 01, 2022 USD ($) wk	Jan. 02, 2021 USD ($) wk	Dec. 28, 2019 USD ($) wk
Disaggregation of Revenue [Line Items]
Sales	$ 3,079,582	$ 3,134,640	$ 2,559,617
Fiscal year duration in weeks \| wk	52	53	52
Perishable
Disaggregation of Revenue [Line Items]
Sales	$ 1,067,198	$ 1,054,506	$ 868,109
Non-Perishable
Disaggregation of Revenue [Line Items]
Sales	$ 2,012,384	$ 2,080,134	$ 1,691,508

- Definition

Amount, excluding tax collected from customer, of revenue from satisfaction of performance obligation by transferring promised good or service to customer. Tax collected from customer is tax assessed by governmental authority that is both imposed on and concurrent with specific revenue-producing transaction, including, but not limited to, sales, use, value added and excise.

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-Section 50
-Paragraph 5
-URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130545-203045

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 924
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SAB Topic 11.L)
-URI http://asc.fasb.org/extlink&oid=6472922&loc=d3e499488-122856

+ Details

Independent Operator Notes and Independent Operator Receivables - Narrative (Details) - USD ($) $ in Millions	Jan. 01, 2022	Jan. 02, 2021
Financing Receivable, Allowance for Credit Loss [Line Items]
Accrued interest receivable	$ 0.5	$ 0.4
Minimum
Financing Receivable, Allowance for Credit Loss [Line Items]
Independent operator notes, stated interest rate	3.00%
Maximum
Financing Receivable, Allowance for Credit Loss [Line Items]
Independent operator notes, stated interest rate	9.95%

Independent Operator Notes and Independent Operator Receivables - Schedule of Amounts Due (Details) - USD ($) $ in Thousands	Jan. 01, 2022	Jan. 02, 2021
Independent operator notes
Gross	$ 34,221	$ 37,238
Allowance, Current Portion	(811)	(514)
Allowance, Long-term Portion	(10,506)	(7,124)
Net	22,904	29,600
Current Portion	1,388	2,160
Long-term Portion	21,516	27,440
Independent operator receivables
Gross	6,426	3,754
Allowance, Current Portion	(595)	(471)
Allowance, Long-term Portion	0	0
Net	5,831	3,283
Current Portion	5,831	3,283
Long-term Portion	0	0
Total
Gross	40,647	40,992
Allowance, Current Portion	(1,406)	(985)
Allowance, Long-term Portion	(10,506)	(7,124)
Net	28,735	32,883
Current Portion	7,219	5,443
Long-term Portion	$ 21,516	$ 27,440

Independent Operator Notes and Independent Operator Receivables - Allowance Activity (Details) - USD ($) $ in Thousands	12 Months Ended
	Jan. 01, 2022	Jan. 02, 2021	Dec. 28, 2019
Accounts And Financing Receivable, Allowance For Credit Loss [Roll Forward]
Beginning balance	$ 8,109	$ 10,371	$ 9,067
Provision for IO notes and IO receivables	4,790	(473)	2,741
Cumulative effect of accounting change	0	(439)	0
Write-off of provision for IO notes and IO receivables	(987)	(1,350)	(1,437)
Ending balance	$ 11,912	$ 8,109	$ 10,371

Independent Operator Notes and Independent Operator Receivables - Credit Quality Indicators (Details) - USD ($) $ in Thousands	Jan. 01, 2022	Jan. 02, 2021
Financing Receivable, Credit Quality Indicator [Line Items]
2021	$ 14,954
2020	8,688
2019	5,464
2018	3,143
2017	1,344
Prior	628
Total	34,221	$ 37,238
TCAP
Financing Receivable, Credit Quality Indicator [Line Items]
2021	3,182
2020	2,331
2019	1,791
2018	1,058
2017	463
Prior	257
Total	9,082
Non-TCAP
Financing Receivable, Credit Quality Indicator [Line Items]
2021	5,157
2020	3,709
2019	3,673
2018	2,085
2017	881
Prior	371
Total	15,876
New store
Financing Receivable, Credit Quality Indicator [Line Items]
2021	6,615
2020	2,648
2019	0
2018	0
2017	0
Prior	0
Total	$ 9,263

Property and Equipment - Schedule of Property and Equipment (Details) - USD ($) $ in Thousands	Jan. 01, 2022	Jan. 02, 2021
Property, Plant and Equipment [Line Items]
Property and Equipment, At Cost	$ 762,984	$ 639,753
Accumulated Depreciation and Amortization	(263,597)	(206,101)
Property and Equipment, Net	499,387	433,652
Leasehold improvements
Property, Plant and Equipment [Line Items]
Property and Equipment, At Cost	333,053	275,586
Accumulated Depreciation and Amortization	(92,815)	(70,999)
Property and Equipment, Net	240,238	204,587
Fixtures and equipment
Property, Plant and Equipment [Line Items]
Property and Equipment, At Cost	396,500	330,338
Accumulated Depreciation and Amortization	(170,487)	(134,820)
Property and Equipment, Net	226,013	195,518
Other
Property, Plant and Equipment [Line Items]
Property and Equipment, At Cost	376	376
Accumulated Depreciation and Amortization	(295)	(282)
Property and Equipment, Net	81	94
Construction in progress
Property, Plant and Equipment [Line Items]
Property and Equipment, At Cost	33,055	33,453
Accumulated Depreciation and Amortization	0	0
Property and Equipment, Net	$ 33,055	$ 33,453

Property and Equipment - Depreciation Expense (Details) - USD ($) $ in Thousands	12 Months Ended
	Jan. 01, 2022	Jan. 02, 2021	Dec. 28, 2019
Property, Plant and Equipment [Line Items]
Depreciation of property and equipment	$ 63,442	$ 50,749	$ 42,906
Cost of sales
Property, Plant and Equipment [Line Items]
Depreciation of property and equipment	1,486	1,299	1,210
Operating expenses
Property, Plant and Equipment [Line Items]
Depreciation of property and equipment	$ 61,956	$ 49,450	$ 41,696

Leases - Narrative (Details) $ in Millions	Jan. 01, 2022 USD ($) store retailStoreLease warehouse	Jan. 02, 2021 store warehouse
Lessee, Lease, Description [Line Items]
Number of stores \| store	415
Leases not yet commenced, total undiscounted future lease payments \| $	$ 141.9
Operating lease, term of contract	15 years
Operating sublease, payments due \| $	$ 5.3
Minimum
Lessee, Lease, Description [Line Items]
Operating lease, renewal term	5 years
Maximum
Lessee, Lease, Description [Line Items]
Operating lease, renewal term	15 years
Related Parties
Lessee, Lease, Description [Line Items]
Number of stores \| store	15	15
Number of warehouses \| warehouse	1	1
Number of leases not yet commenced \| retailStoreLease	25

Leases - Balance Sheet Classification of Right-of-Use Assets and Lease Liabilities (Details) - USD ($) $ in Thousands	Jan. 01, 2022	Jan. 02, 2021
Assets, Lessee [Abstract]
Operating lease right-of-use assets	$ 898,152	$ 835,397
Finance lease other assets	6,896	5,973
Total lease assets	905,048	841,370
Lease, Liability, Current [Abstract]
Operating lease, liability, current	49,861	47,730
Finance lease, liability, current	1,275	945
Lease, Liability, Noncurrent [Abstract]
Operating lease, liability, noncurrent	956,104	876,329
Finance lease, liability, noncurrent	5,642	5,109
Total lease liabilities	$ 1,012,882	$ 930,113
Finance Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List]	Other assets	Other assets
Operating Lease, Liability, Current, Statement of Financial Position [Extensible List]	Current lease liabilities	Current lease liabilities
Finance Lease, Liability, Current, Statement of Financial Position [Extensible List]	Current lease liabilities	Current lease liabilities
Operating Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List]	go:LeaseLiabilityNoncurrent	go:LeaseLiabilityNoncurrent
Finance Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List]	go:LeaseLiabilityNoncurrent	go:LeaseLiabilityNoncurrent

Leases - Components of Lease Expense (Details) - USD ($) $ in Thousands	12 Months Ended
	Jan. 01, 2022	Jan. 02, 2021	Dec. 28, 2019
Leases [Abstract]
Operating lease cost	$ 123,799	$ 112,096	$ 99,237
Finance lease cost:
Amortization of right-of-use assets	1,249	964	817
Interest on finance leases	378	376	263
Variable lease cost	547	700	668
Sublease income	(1,114)	(972)	(1,248)
Net lease cost	$ 124,859	$ 113,164	$ 99,737

Leases - Maturity of Lease Liabilities (Details) $ in Thousands	Jan. 01, 2022 USD ($)
Operating Leases
2022	$ 113,191
2023	126,143
2024	125,713
2025	124,371
2026	123,687
Thereafter	832,129
Total lease payments	1,445,234
Less: Imputed interest	(439,269)
Present value of lease liabilities	1,005,965
Finance Leases
2022	1,605
2023	1,503
2024	1,438
2025	1,207
2026	839
Thereafter	1,486
Total lease payments	8,078
Less: Imputed interest	(1,161)
Present value of lease liabilities	6,917
Total
2022	114,796
2023	127,646
2024	127,151
2025	125,578
2026	124,526
Thereafter	833,615
Total lease payments	$ 1,453,312

Leases - Lease Term and Discount Rate (Details)	Jan. 01, 2022	Jan. 02, 2021
Weighted-average remaining lease term:
Operating leases	11 years 7 months 6 days	12 years
Finance leases	5 years 9 months 18 days	6 years 8 months 12 days
Weighted-average discount rate:
Operating leases	6.46%	6.91%
Finance leases	5.36%	6.08%

Leases - Cash Flow Information (Details) - USD ($) $ in Thousands	12 Months Ended
	Jan. 01, 2022	Jan. 02, 2021	Dec. 28, 2019
Lessee, Lease, Description [Line Items]
Operating cash flows from operating leases	$ 113,886	$ 101,245	$ 88,362
Operating cash flows from finance leases	378	378	337
Finance cash flows from finance leases	1,155	821	675
Leased assets obtained in exchange for new operating lease liabilities	139,663	166,018	155,986
Leased assets obtained in exchange for new finance lease liabilities	$ 2,019	$ 883	0
Cumulative Effect, Period of Adoption, Adjustment
Lessee, Lease, Description [Line Items]
Leased assets obtained in exchange for new operating lease liabilities			$ 664,882

Goodwill and Intangible Assets - Information Regarding Goodwill and Intangible Assets (Details) - USD ($) $ in Thousands	Jan. 01, 2022	Jan. 02, 2021
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	$ 92,508	$ 83,268
Accumulated Amortization	(48,869)	(42,586)
Net Carrying Amount	43,639	40,682
Intangible Assets, Net (Excluding Goodwill) [Abstract]
Gross Carrying Amount	100,790	90,812
Accumulated Amortization	(48,869)	(42,586)
Net Carrying Amount	51,921	48,226
Goodwill	747,943	747,943
Intangible Assets, Net (Including Goodwill) [Abstract]
Gross Carrying Amount	848,733	838,755
Accumulated Amortization	(48,869)	(42,586)
Net Carrying Amount	799,864	796,169
Liquor licenses
Indefinite-lived Intangible Assets [Line Items]
Indefinite-lived intangible assets	8,282	7,544
Trademarks
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	58,400	58,400
Accumulated Amortization	(28,111)	(24,218)
Net Carrying Amount	30,289	34,182
Intangible Assets, Net (Excluding Goodwill) [Abstract]
Accumulated Amortization	(28,111)	(24,218)
Intangible Assets, Net (Including Goodwill) [Abstract]
Accumulated Amortization	(28,111)	(24,218)
Computer software
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	34,108	24,868
Accumulated Amortization	(20,758)	(18,368)
Net Carrying Amount	13,350	6,500
Intangible Assets, Net (Excluding Goodwill) [Abstract]
Accumulated Amortization	(20,758)	(18,368)
Intangible Assets, Net (Including Goodwill) [Abstract]
Accumulated Amortization	$ (20,758)	$ (18,368)

Goodwill and Intangible Assets - Narrative (Details) - USD ($) $ in Millions	12 Months Ended
	Jan. 01, 2022	Jan. 02, 2021	Dec. 28, 2019
Goodwill and Intangible Assets Disclosure [Abstract]
Amortization of intangible assets	$ 6.6	$ 6.5	$ 6.7

Goodwill and Intangible Assets - Estimated Future Amortization Expense Related to Finite-Lived Intangible Assets (Details) - USD ($) $ in Thousands	Jan. 01, 2022	Jan. 02, 2021
Goodwill and Intangible Assets Disclosure [Abstract]
2022	$ 7,085
2023	6,771
2024	5,802
2025	4,653
2026	4,653
Thereafter	14,675
Net Carrying Amount	$ 43,639	$ 40,682

Long-term Debt - Schedule of Long-term Debt (Details) - USD ($) $ in Thousands	Jan. 01, 2022	Jan. 02, 2021
Debt Instrument [Line Items]
Long-term debt, gross	$ 460,000	$ 460,000
Less: Unamortized debt discounts and debt issuance costs	(8,532)	(10,767)
Long-term debt, net	451,468	449,233
Senior Notes \| First Lien Credit Agreement
Debt Instrument [Line Items]
Long-term debt, gross	$ 460,000	$ 460,000

Long-term Debt - Narrative (Details) - USD ($)			3 Months Ended	12 Months Ended
Long-term Debt - Narrative (Details) - USD ($)	Mar. 19, 2020	Jan. 24, 2020	Mar. 28, 2020	Jan. 01, 2022	Jan. 02, 2021	Dec. 28, 2019
Debt Instrument [Line Items]
Write-off of debt issuance costs				$ 0	$ 74,000	$ 4,110,000
Debt modification costs				0	124,000	$ 150,000
First Lien Credit Agreement \| Revolving Credit Facility
Debt Instrument [Line Items]
Maximum borrowing capacity				100,000,000
Letters of credit outstanding				3,500,000
Borrowing capacity available				96,500,000
Line of credit outstanding				$ 0	$ 0
Proceeds from revolving credit facility	$ 90,000,000
Secured leverage ratio				7.00
Threshold to test ratio				$ 10,000,000
Threshold to test ratio, percentage of revolving credit facility commitments				35.00%
First Lien Credit Agreement \| Revolving Credit Facility \| Minimum
Debt Instrument [Line Items]
Commitment fee percentage				0.25%
First Lien Credit Agreement \| Revolving Credit Facility \| Maximum
Debt Instrument [Line Items]
Commitment fee percentage				0.50%
First Lien Credit Agreement \| Letter of Credit
Debt Instrument [Line Items]
Maximum borrowing capacity				$ 35,000,000
First Lien Credit Agreement \| Bridge Loan
Debt Instrument [Line Items]
Maximum borrowing capacity				20,000,000
First Lien Credit Agreement \| Senior Notes
Debt Instrument [Line Items]
Debt instrument, face amount				$ 460,000,000
Interest rate at period end				2.85%
Second Replacement Term Loan \| Senior Notes
Debt Instrument [Line Items]
Debt instrument, face amount		$ 460,000,000
Write-off of debt issuance costs			$ 100,000
Debt modification costs			$ 100,000
Second Replacement Term Loan \| Senior Notes \| Eurodollar
Debt Instrument [Line Items]
Basis spread on variable rate		2.75%
Second Replacement Term Loan \| Senior Notes \| Base Rate
Debt Instrument [Line Items]
Basis spread on variable rate		1.75%

Long-term Debt - Schedule of Principal Maturities (Details) $ in Thousands	Jan. 01, 2022 USD ($)
Debt Disclosure [Abstract]
Fiscal 2022	$ 0
Fiscal 2023	0
Fiscal 2024	0
Fiscal 2025	460,000
Fiscal 2026	0
Thereafter	0
Total	$ 460,000

- Definition

Amount, after unamortized (discount) premium and debt issuance costs, of long-term debt. Includes, but not limited to, notes payable, bonds payable, debentures, mortgage loans and commercial paper. Excludes capital lease obligations.

+ References + Details

Long-term Debt - Interest Expense (Details) - USD ($) $ in Thousands	12 Months Ended
	Jan. 01, 2022	Jan. 02, 2021	Dec. 28, 2019
Debt Disclosure [Abstract]
Interest on loans	$ 13,930	$ 18,950	$ 45,084
Amortization of debt issuance costs and debt discounts	2,511	2,452	2,542
Interest on finance leases	378	376	263
Other	66	32	51
Interest income	(1,321)	(1,767)	(2,013)
Interest expense, net	$ 15,564	$ 20,043	$ 45,927

Long-term Debt - Debt Extinguishment and Modification Costs (Details) - USD ($) $ in Thousands	12 Months Ended
	Jan. 01, 2022	Jan. 02, 2021	Dec. 28, 2019
Debt Disclosure [Abstract]
Write-off of debt issuance costs	$ 0	$ 74	$ 4,110
Debt modification costs	0	124	150
Write off of debt discounts	0	0	1,374
Debt extinguishment and modification costs	$ 0	$ 198	$ 5,634

Stockholders' Equity - Narrative (Details) - USD ($)							1 Months Ended	12 Months Ended
Stockholders' Equity - Narrative (Details) - USD ($)	May 28, 2020	Apr. 27, 2020	Feb. 03, 2020	Oct. 23, 2019	Oct. 08, 2019	Jun. 24, 2019	Jun. 30, 2019	Jan. 01, 2022	Jan. 02, 2021	Dec. 28, 2019	Nov. 05, 2021
Subsidiary, Sale of Stock [Line Items]
Common stock, shares authorized (in shares)								500,000,000	500,000,000
Common stock, par (in usd per share)								$ 0.001	$ 0.001
Preferred stock, shares authorized (in shares)								50,000,000	50,000,000
Preferred stock, par (in usd per share)								$ 0.001	$ 0.001
Proceeds from initial public offering, net of underwriting discounts paid								$ 0	$ 0	$ 407,666,000
Payments of stock issuance costs								0	0	7,062,000
Offering costs incurred			$ 1,100,000		$ 1,100,000				$ 1,000,000	$ 1,100,000
Proceeds from stock options exercised		$ 1,600,000	$ 1,400,000
Exercised (in shares)		269,000	191,470
Stock repurchase program, remaining authorized amount								$ 100,000,000
Maximum
Subsidiary, Sale of Stock [Line Items]
Stock repurchase authorized amount											$ 100,000,000
Hellman and Friedman, LLC
Subsidiary, Sale of Stock [Line Items]
Transfer of common stock holdings to stockholder's equity holders (in shares)	9,600,000
Second Lien Credit Agreement \| Senior Notes
Subsidiary, Sale of Stock [Line Items]
Repayments of long-term debt						$ 150,000,000
Debt instrument, periodic payment, interest						3,600,000
First Lien Credit Agreement \| Senior Notes
Subsidiary, Sale of Stock [Line Items]
Repayments of long-term debt				$ 15,000,000		248,000,000
Debt instrument, periodic payment, interest						3,800,000
Preferred Stock
Subsidiary, Sale of Stock [Line Items]
Redemption of preferred stock						$ 1.00
IPO
Subsidiary, Sale of Stock [Line Items]
Issuance of shares (in shares)					451,470		19,765,625
Sale of stock (in usd per share)							$ 22.00
Proceeds from initial public offering, net of underwriting discounts paid					$ 3,200,000		$ 407,700,000
Expense Related to Distribution or Servicing and Underwriting Fees							(27,100,000)
Payments of stock issuance costs							$ 7,200,000

Share-based Awards - Narrative (Details) - USD ($) $ in Thousands				12 Months Ended
	Apr. 27, 2020	Feb. 03, 2020	Jun. 04, 2019	Jan. 01, 2022	Jan. 02, 2021	Dec. 28, 2019
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Intrinsic value of stock options exercised				$ 30,300
Share-based compensation				17,615	$ 38,084	$ 31,439
Payments of dividends				186	434	3,645
RSUs
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unamortized compensation cost				$ 16,900
Unamortized compensation cost, weighted average period				1 year 7 months 6 days
Share-based compensation				$ 8,488	4,978	2,054
PSUs
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award vesting period				3 years
Unamortized compensation cost				$ 10,400
Unamortized compensation cost, weighted average period				1 year 6 months
Share-based compensation				$ 6,911	3,652	0
Time-based stock options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Intrinsic value of stock options exercised				15,500	68,700	20,800
Unamortized compensation cost				$ 3,400
Unamortized compensation cost, weighted average period				1 year 6 months
Share-based compensation				$ 2,030	2,941	25,740
Time-based options granted prior to IPO
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unamortized compensation cost				3,100
Performance-based stock options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares vested (in shares)	1,700,000	4,100,000
Share-based compensation	$ 7,600	$ 18,500		0	$ 26,079	$ 0
Time Based Stock Options and Restricted Stock Units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unamortized compensation cost				$ 200
Minimum \| RSUs
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award vesting period				1 year
Minimum \| PSUs
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Performance target percentages				0.00%
Maximum \| RSUs
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award vesting period				3 years
Maximum \| PSUs
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Performance target percentages				200.00%
2019 Incentive Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares reserved for issuance (in shares)			4,597,862
Percent of common stock outstanding			4.00%
Share of common stock reserved for issuance (in shares)				6,048,252
Increase in shares available for issuance (in shares)				501,845
Aggregate shares reserved for issuance (in shares)				3,330,247

Share-based Awards - Weighted-Average Fair Value for Time-Based and Performance-Based Options and RSUs Granted (Details) - $ / shares	12 Months Ended
	Jan. 01, 2022	Jan. 02, 2021	Dec. 28, 2019
Time-based stock options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Weighted-average fair value (in usd per share)			$ 7.61
Performance-based stock options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Weighted-average fair value (in usd per share)			5.78
RSUs
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Weighted-average fair value (in usd per share)	$ 28.70	$ 37.07	$ 27.13
PSUs
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Weighted-average fair value (in usd per share)	$ 35.45	$ 36.90

Share-based Awards - Assumptions Used to Estimate Fair Values of Time-Based Options (Details) - Time-based stock options	12 Months Ended
	Dec. 28, 2019 $ / shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Exercise price (in usd per share)	$ 21.66
Volatility	30.20%
Risk-free interest rate	1.90%
Dividend yield	0.00%
Expected term (in years)	6 years 9 months 18 days

Share-based Awards - Summary of Stock Option Activity (Details) - $ / shares			12 Months Ended
	Apr. 27, 2020	Feb. 03, 2020	Jan. 01, 2022	Jan. 02, 2021	Dec. 28, 2019
Number of Options
Exercised (in shares)	(269,000)	(191,470)
Time-Based Stock Options
Number of Options
Options outstanding, beginning balance (in shares)			3,864,772	6,243,667	5,798,375
Granted (in shares)			0	0	1,363,822
Exercised (in shares)			(538,307)	(2,326,219)	(817,051)
Forfeitures (in shares)			(191,324)	(52,676)	(101,479)
Options outstanding, ending balance (in shares)			3,135,141	3,864,772	6,243,667
Option vested and expected to vest (in shares)			1,896,260
Weighted-Average Exercise Price
Weighted-average exercise price, beginning balance (in usd per share)			$ 12.42	$ 10.57	$ 7.53
Granted (in usd per share)			0	0	21.66
Exercised (in usd per share)			7.77	7.29	7.21
Forfeitures (in usd per share)			19.77	20.63	12.72
Weighted-average exercise price, ending balance (in usd per share)			12.77	$ 12.42	$ 10.57
Option vested and expected to vest, weighted average exercise price (in usd per share)			$ 7.59
Performance-Based Stock Options
Number of Options
Options outstanding, beginning balance (in shares)			2,325,580	5,777,121	5,795,330
Granted (in shares)			0	0	99,788
Exercised (in shares)			(629,386)	(3,438,470)	0
Forfeitures (in shares)			0	(13,071)	(117,997)
Options outstanding, ending balance (in shares)			1,696,194	2,325,580	5,777,121
Option vested and expected to vest (in shares)			1,696,194
Weighted-Average Exercise Price
Weighted-average exercise price, beginning balance (in usd per share)			$ 4.54	$ 4.57	$ 4.40
Granted (in usd per share)			0	0	17.29
Exercised (in usd per share)			4.41	4.55	0
Forfeitures (in usd per share)			0	16.47	7.15
Weighted-average exercise price, ending balance (in usd per share)			4.58	$ 4.54	$ 4.57
Option vested and expected to vest, weighted average exercise price (in usd per share)			$ 4.58

Share-based Awards - Summary of RSU and PSU Activity (Details)	12 Months Ended
	Jan. 01, 2022 $ / shares Rate shares	Jan. 02, 2021 $ / shares shares	Dec. 28, 2019 $ / shares shares
RSUs
Number of Shares
Unvested, beginning balance (in shares)	341,842	190,872	80,820
Granted (in shares)	669,546	277,496	195,135
Vested (in shares)	(110,956)	(115,030)	(76,841)
Forfeitures (in shares)	(63,936)	(11,496)	(8,242)
Unvested, ending balance (in shares)	836,496	341,842	190,872
Weighted-Average Grant Date Fair Value
Unvested, beginning balance (in usd per share) \| $ / shares	$ 35.16	$ 22.89	$ 8.80
Granted (in usd per share) \| $ / shares	28.70	37.07	27.13
Vested (in usd per share) \| $ / shares	34.64	19.74	18.06
Forfeitures (in usd per share) \| $ / shares	34.05	31.78	30.03
Unvested, ending balance (in usd per share) \| $ / shares	$ 30.14	$ 35.16	$ 22.89
PSUs
Number of Shares
Unvested, beginning balance (in shares)	407,462	0
Granted (in shares)	319,606	272,640
Adjustment for expected performance achievement	(91,332)	135,821
Vested (in shares)	0	0
Forfeitures (in shares)	(59,011)	(999)
Unvested, ending balance (in shares)	576,725	407,462	0
Weighted-Average Grant Date Fair Value
Unvested, beginning balance (in usd per share) \| $ / shares	$ 36.90	$ 0
Granted (in usd per share) \| $ / shares	35.45	36.90
Adjustment for expected performance achievement (in usd per share) \| $ / shares	35.45	36.90
Vested (in usd per share) \| $ / shares	0	0
Forfeitures (in usd per share) \| $ / shares	36.52	36.88
Unvested, ending balance (in usd per share) \| $ / shares	$ 36.36	$ 36.90	$ 0
Performance target level, percentage	1
PSUs \| Maximum
Weighted-Average Grant Date Fair Value
Performance target level, percentage \| Rate	200.00%
PSUs \| Pro Forma
Number of Shares
Adjustment for expected performance achievement	516,976

Share-based Awards - Summary of Share-Based Compensation Expense (Details) - USD ($) $ in Thousands			12 Months Ended
	Apr. 27, 2020	Feb. 03, 2020	Jan. 01, 2022	Jan. 02, 2021	Dec. 28, 2019
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Share-based compensation expense			$ 17,615	$ 38,084	$ 31,439
Dividends			186	434	3,645
Time-Based Stock Options
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Share-based compensation expense			2,030	2,941	25,740
Performance-based stock options
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Share-based compensation expense	$ 7,600	$ 18,500	0	26,079	0
RSUs
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Share-based compensation expense			8,488	4,978	2,054
PSUs
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Share-based compensation expense			$ 6,911	$ 3,652	$ 0

Retirement Plans (Details) - USD ($)	12 Months Ended
Retirement Plans (Details) - USD ($)	Jan. 01, 2022	Jan. 02, 2021	Dec. 28, 2019
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]
Payments into plan	$ 600,000	$ 600,000	$ 400,000
Surcharges to the fund	$ 0
Percentage of contribution (less than)	5.00%
Payments into the benefits fund	$ 1,400,000	1,400,000	1,200,000
Defined contribution plan, employer matching contribution, percent of match	35.00%
Defined contribution plan, maximum percentage of employee gross	6.00%
Nonunion Employee Retirement and Profit-Sharing Plans
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]
Expenses for contribution plan	$ 1,500,000	$ 6,100,000	$ 4,400,000
Deferred Profit Sharing
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]
Percentage of employer contribution, deferred compensation plan		15.00%
Retirement Plan for Warehouse Employees
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]
Percentage of employer contribution, defined contribution plan	15.00%

Income Taxes - Narrative (Details) - USD ($)	12 Months Ended
Income Taxes - Narrative (Details) - USD ($)	Jan. 01, 2022	Jan. 02, 2021	Dec. 28, 2019
Components Of Income Tax Expense [Line Items]
Loss before equity in net income of subsidiary	$ 77,501,000	$ 87,134,000	$ 16,782,000
Unrecognized tax benefits	0	$ 0
Federal Income Tax
Components Of Income Tax Expense [Line Items]
Net operating loss carryforwards	220,200,000
Net operating loss carryforwards, subject to expiration	77,000,000
Net operating loss carryforwards, not subject to expiration	143,200,000
State Income Tax
Components Of Income Tax Expense [Line Items]
Net operating loss carryforwards	$ 72,400,000

- Definition

Amount of income (loss) from continuing operations, including income (loss) from equity method investments, before deduction of income tax expense (benefit), and income (loss) attributable to noncontrolling interest.

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+ Details

Income Taxes - Components of Income Tax Expense (Details) - USD ($) $ in Thousands	12 Months Ended
	Jan. 01, 2022	Jan. 02, 2021	Dec. 28, 2019
Current:
Federal	$ 0	$ (285)	$ 52
State	2,247	284	439
Total current	2,247	(1)	491
Deferred:
Federal	10,838	(14,682)	247
State	2,106	(4,896)	625
Total deferred	12,944	(19,578)	872
Income tax expense (benefit)	$ 15,191	$ (19,579)	$ 1,363

- Definition

Amount of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations.

+ References + Details

Income Taxes - Income Tax Rate Reconciliation (Details)	12 Months Ended
Income Taxes - Income Tax Rate Reconciliation (Details)	Jan. 01, 2022	Jan. 02, 2021	Dec. 28, 2019
Income Tax Disclosure [Abstract]
Taxes at federal statutory rates	21.00%	21.00%	21.00%
State income taxes net of federal benefit	4.70%	(4.20%)	5.20%
Excess federal tax benefits from exercise and vest of share-based awards	(8.20%)	(40.30%)	(21.40%)
Return to provision	1.90%	0.00%	0.00%
Other	0.20%	1.00%	3.30%
Effective income tax rate	19.60%	(22.50%)	8.10%

Income Taxes - Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands	Jan. 01, 2022	Jan. 02, 2021
Deferred tax assets:
Accrued compensation	$ 1,274	$ 6,362
Share-based compensation expense	10,903	8,891
Inventory	5,135	4,594
Transaction costs	964	1,152
Lease liability obligation	279,541	258,093
Net operating loss and other carryforwards	52,951	58,596
Reserves and allowances	4,446	3,092
Other	4,510	4,194
Total deferred tax assets	359,724	344,974
Deferred tax liabilities:
Prepaid expenses	(1,391)	(1,096)
Depreciation and amortization	(71,114)	(64,814)
Intangible assets	(7,142)	(7,802)
Right-of-use assets	(249,545)	(234,022)
Goodwill	(37,976)	(32,691)
Debt transaction costs	(1,972)	(1,020)
Total deferred tax liabilities	(369,140)	(341,445)
Net deferred tax assets (liabilities)	$ (9,416)
Net deferred tax assets (liabilities)		$ 3,529

Related Party Transactions (Details) $ in Thousands	12 Months Ended
Related Party Transactions (Details) $ in Thousands	Jan. 01, 2022 USD ($) store warehouse	Jan. 02, 2021 USD ($) store warehouse	Dec. 28, 2019 USD ($)
Related Party Transaction [Line Items]
Number of stores \| store	415
Operating lease right-of-use assets	$ 898,152	$ 835,397
Operating lease liability	1,005,965
Aggregate annual lease payments	113,886	101,245	$ 88,362
Accounts and financing receivable, before allowance for credit loss	$ 40,647	$ 40,992
Related Parties
Related Party Transaction [Line Items]
Number of stores \| store	15	15
Number of warehouses \| warehouse	1	1
Operating lease right-of-use assets	$ 36,900	$ 39,800
Operating lease liability	$ 41,600	$ 44,300
Affiliated Entity
Related Party Transaction [Line Items]
Number of stores \| store	15
Number of warehouses \| warehouse		1
Aggregate annual lease payments	$ 6,100	$ 6,000	$ 6,100

Earnings Per Share - Earnings Per Share Attributable to Common Stockholders (Details) - USD ($) $ / shares in Units, $ in Thousands			12 Months Ended
	Apr. 27, 2020	Feb. 03, 2020	Jan. 01, 2022	Jan. 02, 2021	Dec. 28, 2019
Numerator
Net income (loss)			$ 62,310	$ 106,713	$ 15,419
Comprehensive income (loss)			$ 62,310	$ 106,713	$ 15,419
Denominator
Weighted-average shares of common stock - basic (in shares)			95,725,000	91,818,000	79,044,000
Weighted average shares of common stock - diluted (in shares)			99,418,000	98,452,000	81,863,000
Earnings per share:
Basic (in usd per share)			$ 0.65	$ 1.16	$ 0.20
Diluted (in usd per share)			$ 0.63	$ 1.08	$ 0.19
Stock option
Denominator
Effect of dilutive RSUs (in shares)			3,564,000	6,538,000	2,777,000
RSUs
Denominator
Effect of dilutive RSUs (in shares)			129,000	96,000	42,000
Performance-based stock options
Earnings per share:
Number of shares vested (in shares)	1,700,000	4,100,000
PSUs
Denominator
Effect of dilutive RSUs (in shares)			0	0

Earnings Per Share - Anti-dilutive Weighted-Average Common Stock Equivalents Excluded from Calculation of Diluted Earnings (Net Loss) Per Share (Details) - shares shares in Thousands	12 Months Ended
	Jan. 01, 2022	Jan. 02, 2021	Dec. 28, 2019
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share (in shares)	11	3,239	732
RSUs
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share (in shares)	11	3,239	50
Time-based stock options
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share (in shares)	0	0	682

Schedule I—Condensed Financial Information of Registrant - Balance Sheet (Details) - USD ($) $ / shares in Units, $ in Thousands	Jan. 01, 2022	Jan. 02, 2021	Dec. 28, 2019	Dec. 29, 2018
Condensed Financial Statements, Captions [Line Items]
Total assets	$ 2,669,808	$ 2,485,624
Total liabilities	1,660,536	1,563,317
Voting common stock, par value $0.001 per share, 500,000,000 shares authorized; 96,144,433 and 94,854,336 shares issued and outstanding, respectively	96	95
Series A Preferred stock, par value $0.001 per share, 50,000,000 shares authorized; no shares issued and outstanding	0	0
Additional paid-in capital	811,701	787,047
Retained earnings	197,475	135,165
Total stockholders' equity	1,009,272	922,307	$ 745,384	$ 299,951
Total liabilities and stockholders' equity	$ 2,669,808	$ 2,485,624
Common stock, par (in usd per share)	$ 0.001	$ 0.001
Common stock, shares authorized (in shares)	500,000,000	500,000,000
Common stock, issued (in shares)	96,144,433	94,854,336
Common stock, outstanding (in shares)	96,144,433	94,854,336
Preferred stock, par (in usd per share)	$ 0.001	$ 0.001
Preferred stock, shares authorized (in shares)	50,000,000	50,000,000
Preferred stock, issued (in shares)	0	0
Preferred stock, outstanding (in shares)	0	0
Parent Company
Condensed Financial Statements, Captions [Line Items]
Investment in wholly owned subsidiary	$ 1,011,033	$ 923,816
Total assets	1,011,033	923,816
Intercompany payable	1,761	1,509
Total liabilities	1,761	1,509
Voting common stock, par value $0.001 per share, 500,000,000 shares authorized; 96,144,433 and 94,854,336 shares issued and outstanding, respectively	96	95
Series A Preferred stock, par value $0.001 per share, 50,000,000 shares authorized; no shares issued and outstanding	0	0
Additional paid-in capital	811,701	787,047
Retained earnings	197,475	135,165
Total stockholders' equity	1,009,272	922,307
Total liabilities and stockholders' equity	$ 1,011,033	$ 923,816
Preferred stock, par (in usd per share)	$ 0.001	$ 0.001
Preferred stock, shares authorized (in shares)	50,000,000	50,000,000
Preferred stock, issued (in shares)	0	0
Preferred stock, outstanding (in shares)	0	0
Parent Company \| Common Stock
Condensed Financial Statements, Captions [Line Items]
Common stock, par (in usd per share)	$ 0.001	$ 0.001
Common stock, shares authorized (in shares)	500,000,000	500,000,000
Common stock, issued (in shares)	96,144,433	94,854,336
Common stock, outstanding (in shares)	96,144,433	94,854,336

Schedule I—Condensed Financial Information of Registrant - Income Statement (Details) - USD ($) $ in Thousands	12 Months Ended
	Jan. 01, 2022	Jan. 02, 2021	Dec. 28, 2019
Condensed Financial Statements, Captions [Line Items]
Operating expenses	$ 859,691	$ 865,972	$ 718,759
Operating loss	89,095	107,375	68,343
Loss before equity in net income of subsidiary	77,501	87,134	16,782
Net income	62,310	106,713	15,419
Net income and comprehensive income	62,310	106,713	15,419
Parent Company
Condensed Financial Statements, Captions [Line Items]
Operating expenses	251	265	273
Operating loss	(251)	(265)	(273)
Loss before equity in net income of subsidiary	(251)	(265)	(273)
Equity in net income of subsidiary, net of tax	62,561	106,978	15,692
Net income	62,310	106,713	15,419
Net income and comprehensive income	$ 62,310	$ 106,713	$ 15,419

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

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+ Details

Schedule I—Condensed Financial Information of Registrant - Cash Flow (Details) - USD ($) $ in Thousands	12 Months Ended
	Jan. 01, 2022	Jan. 02, 2021	Dec. 28, 2019
Cash flows from operating activities:
Net income (loss)	$ 62,310	$ 106,713	$ 15,419
Changes in operating assets and liabilities:
Net cash provided by operating activities	165,587	181,237	132,835
Cash flows from investing activities:
Net cash used in investing activities	(136,713)	(133,786)	(108,019)
Cash flows from financing activities:
Proceeds from initial public offering, net of underwriting discounts	0	0	407,666
Proceeds from exercise of share-based compensation awards	7,226	32,604	4,444
Payments made for net settlement of employee share-based compensation awards	0	(483)	(2,813)
Other direct costs paid related to the initial public offering	0	0	(7,062)
Net cash provided by financing activities	5,885	29,774	(17,778)
Net increase in cash and cash equivalents	34,759	77,225	7,038
Cash and cash equivalents - Beginning of the period	105,326	28,101	21,063
Cash and cash equivalents at end of period	140,085	105,326	28,101
Parent Company
Cash flows from operating activities:
Net income (loss)	62,310	106,713	15,419
Adjustments to reconcile net income to net cash provided by operating activities:
Equity in net income of subsidiary	(62,561)	(106,978)	(15,692)
Changes in operating assets and liabilities:
Other current assets	0	0	497
Net cash provided by operating activities	(251)	(265)	224
Cash flows from investing activities:
Investment in subsidiary	(7,226)	(32,121)	(402,050)
Net cash used in investing activities	(7,226)	(32,121)	(402,050)
Cash flows from financing activities:
Intercompany payables	251	265	(409)
Proceeds from initial public offering, net of underwriting discounts	0	0	407,666
Proceeds from exercise of share-based compensation awards	7,226	32,604	4,444
Payments made for net settlement of employee share-based compensation awards	0	(483)	(2,813)
Other direct costs paid related to the initial public offering	0	0	(7,062)
Net cash provided by financing activities	7,477	32,386	401,826
Net increase in cash and cash equivalents	0	0	0
Cash and cash equivalents - Beginning of the period	0	0	0
Cash and cash equivalents at end of period	$ 0	$ 0	$ 0

Schedule I—Condensed Financial Information of Registrant - Additional Information (Details) - USD ($) $ / shares in Units, $ in Thousands					1 Months Ended	12 Months Ended
	May 28, 2020	Apr. 27, 2020	Feb. 03, 2020	Oct. 08, 2019	Jun. 30, 2019	Jan. 01, 2022	Jan. 02, 2021	Dec. 28, 2019
Condensed Financial Statements, Captions [Line Items]
Proceeds from initial public offering, net of underwriting discounts paid						$ 0	$ 0	$ 407,666
Payments of stock issuance costs						0	0	7,062
Offering costs incurred			$ 1,100	$ 1,100			1,000	1,100
Proceeds from stock options exercised		$ 1,600	$ 1,400
Exercised (in shares)		269,000	191,470
Hellman and Friedman, LLC
Condensed Financial Statements, Captions [Line Items]
Transfer of common stock holdings to stockholder's equity holders (in shares)	9,600,000
IPO
Condensed Financial Statements, Captions [Line Items]
Issuance of shares (in shares)				451,470	19,765,625
Sale of stock (in usd per share)					$ 22.00
Proceeds from initial public offering, net of underwriting discounts paid				$ 3,200	$ 407,700
Underwriting discounts and commissions					27,100
Payments of stock issuance costs					$ 7,200
Parent Company
Condensed Financial Statements, Captions [Line Items]
Proceeds from initial public offering, net of underwriting discounts paid						0	0	407,666
Payments of stock issuance costs						$ 0	$ 0	$ 7,062
Parent Company \| Globe Intermediate Corp.
Condensed Financial Statements, Captions [Line Items]
Ownership percentage						100.00%
Parent Company \| GOBP Holdings, Inc.
Condensed Financial Statements, Captions [Line Items]
Ownership percentage						100.00%
Parent Company \| GOBP Midco, Inc.
Condensed Financial Statements, Captions [Line Items]
Ownership percentage						100.00%
Parent Company \| Grocery Outlet Inc.
Condensed Financial Statements, Captions [Line Items]
Ownership percentage						100.00%