After taking an exhaustive look at the state of the food retail industry, we’ve uncovered a few trends that are shaking things up. It’s no longer “business as usual” for this industry. The threats are real. How you respond will determine whether you struggle or thrive.
Here are the five major threats that are impacting your grocery or specialty food store's profitability:
- Threat #1: Lower Prices and Lower Margins – For the first time in 50 years, shoppers are enjoying spending less for a basket of groceries. And, low-priced chains are forcing other chains to reduce prices to stay competitive. How will you deal with this downward pressure on your margins?
- Threat #2: Overcrowded Sector – Everyone is selling groceries these days. Dollar stores, drug stores, convenience markets, and other outlets are crowding the space. As the food retail sector is becoming more saturated, competition is getting fiercer. Deep discounters are attracting the budget-minded shopper. Internet retailers are attracting higher-income shoppers. Where are you staking your claim?
- Threat #3: Shoppers are Shopping Around – There once was a time when people shopped at just one grocery store. It was their home grocery store. It was a place where they were most comfortable. Now, with retail options multiplying, shoppers are becoming less loyal. How can you regain their loyalty?
- Threat #4: Online Grocery Shopping – In 2019, online grocery sales are projected to reach $107 million. By 2022, online grocery sales will top $177 million. Are you prepared to compete in the online grocery shopping era?
- Threat #5: Amazon’s Acquisition of Whole Foods – The Amazon-ification of grocery stores has begun. Amazon’s acquisition of Whole Foods is having an impact on the grocery sector that has never been seen before. How will you respond?
To learn effective ways to combat these threats, download our free white paper: The 5 Biggest Threats in the Food Retail Landscape and How to Handle Them.