In the United States Aldi and WinCo are the two fastest growing fresh food grocery retailers both offer low-cost high quality fresh food. Dollar stores all the while continuing expanding food offerings including more and more fresh food and fresh prepared Ready-2-Eat and Heat-N-Eat food. Walgreens, Rite-Aid each continue expanding fresh prepared food offerings creating a platform for ‘ruthless’ competition for legacy grocery stores that focus more on slotting fees than the consumer. All this while the restaurant sector continues to capitulate customers.
Food Consumer Discontinuity
The Restaurant sector continues to suffer customer declines according to TDn2K’s latest Black Box Intelligence and People Report same-store traffic fell 0.2 percent during September. According to Foodservice Solutions® Grocerant Guru™ Steven Johnson “that makes 5 years of flat or declining customer counts the consumer is not eating less they are eating somewhere else.”
Five years is a long, time, long enough that consumer behavior is evolving faster than many legacy food retailers. Five years is a long enough time that ‘promiscuous’ shoppers, are fast becoming brand loyal customer at new and non-traditional fresh food outlets. Once driven by competitive pricing today consumers are more and more driven by convenience.
So, Where Are the Food Shopper’s Migrating
Steve Bishop of BricksMeetsClick.com outlined where the upscale food shopper is migrating. Bishop has forecast that “Online grocery spending in the US will reach between 11% and 17% in most markets by 2023. Bishop thinks that the fastest growing markets will reach that range even faster. If the high-end is migrating to Online, the low end to discounters Aldi, WinnCo, and Dollar Stores where are those in the middle migrating?
Foodservice Solutions® Grocerant Guru™ say’s look no further than the United Kingdom to find how and where the ‘middle’ consumers are going creating new winners the retail food space. It also provides a view how restaurants customer count capitulation can be explained.
In fact “1 in every 3 visits to a convenience store in London is to buy food-to-go, according UK according to Katie Littler, Insights Director at him! research & consulting. Littler continued; “Overall 24p in every £1 spent in convenience stores is now spent on meal occasions (food-to-go or meal for tonight) and this proportion continues to grow.”
Price Value Service
The price, value, service equilibrium is resetting in the United Sates. Driven by new non-traditional fresh food retailers and continued economic doldrums. Success does however leave clues. Doing what you have always done, and doing it the same way will not work today. Do you understand the new competitive food landscape? Wawa in the US says that it is a Fast Casual Restaurant To-Go. Where are your customers eating? Do you know how to compete in an Omni-channel world? If not, we do.
Invite Foodservice Solutions® to complete a grocerant program assessment, grocerant scorecard, brand, or product placement assistance. Since 1991 www.FoodserviceSolutions.us of Tacoma, WA has been the global leader in the Grocerant niche. Contact: Steve@FoodserviceSolutions.us or 253-759-7869 Linkedin.com/in/grocerant or twitter.com/grocerant