The grocery store industry isn't very exciting. It's dominated by mega-chains that have grown over the years through acquisitions, and they're all forced to compete with on price. That doesn't sound like a great place to find market-beating investments.

One publicly traded grocery store chain does things differently. Sprouts Farmers Market (NASDAQ: SFM) purposely tries to be small. Its stores are a fraction of the size of a typical supermarket, and it makes no attempt to stock everything under the sun. Instead, it puts a large produce section with affordable prices front and center. The rest of the store is filled with a curated selection of products, 70% of which are attribute-based: vegan, organic, gluten-free, grass-fed, and so on.

Smaller stores are cheaper to build and can work in places where larger supermarkets would struggle. The company's new 23k sq. ft. store format costs $3.8 million on average to get up and running, brings in $13 million in sales, and reaches earnings before interest, taxes, depreciation, and amortization (EBITDA) profitability in the first year.

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Source Fool.com