Reality Denial Ripples Through Legacy Grocery Sector as Sales Slide

Jim Hertel, managing partner of Willard Bishop Consulting seemingly expressed continued dismay, disbelief, and disappointment in the status of legacy grocery retailers to infuse contemporized relevance into their business models.  

During a Webinar this week Hertel was speaking and referring to Willard Bishop’s research "The Future of Food Retailing: Shopper Behavior Is Driving Retail Evolution". One problem the future was not legacy looking bright for the legacy grocery sector.  Yes, the future is being found in new non-traditional fresh food retailers.  Yes, you know the ones you keep reading about on this blog; Ready-2-Eat and Heat-N-Eat fresh prepared grocerant niche retailers. 

So, why did Hertel seemingly expressed continued dismay, disbelief, and disappointment in the status of legacy grocery retailers?  Let’s look at just some of his findings too find out:

1.       The report found, the traditional grocery channel's dollar share has decreased by about half since 1988, while non-traditional grocery and convenience stores competed for the food dollar.

2.       Specifically, the non-traditional channel's dollar share jumped from 2 percent in 1988 to 39 percent in 2014,

3.       The convenience channel's dollar share almost doubled from 8 percent to 15 percent over those 25-plus years.

4.       By 2019, Willard Bishop predicts traditional supermarkets will continue to lose dollar share to other segments of the traditional grocery channel, like fresh format and limited assortment.

Now we all know that Willard Bishop is one of the most respected grocery research firms in the United States.  We agree Willard Bishop’s findings. Foodservice Solutions® Grocerant Guru™ say’s clearly the grocerant niche is not the path to yesterday but rather the path to tomorrow’s food retail success. 

While avenues of customer messaging continue to evolve they are but one component in the sales mix.  Customer messaging and message may be delivered with new technology creating a highly fragmented communication world.  The fact is neither messaging nor technology is the Achilles Heel of the grocery sector.  

The Achilles Heel of the grocery sector continues to be slotting fees.  When a retail sector focused on selling food is not selling the type of food customer want they will continue to capitulate market share.  Consumer adoption of Grocerant niche Ready-2-Eat and Heat-N-Eat fresh prepared food has been unprecedented, disruptive, and for many of us a career opportunity of a life time.  

Quit pointing the finger, blaming others, Sell What Customers Want. That is Grocerant niche Ready-2-Eat and Heat-N-Eat fresh prepared food. If someone is paying you to place their food on your shelves you might ask yourself why?  If you are in the shelf rental business, take the money.  If you are in the food business move on or move out. Are you trapped doing what you have always done and doing it the same way? 

Interested in learning how Foodservice Solutions 5P’s of Food Marketing can edify your retail food brand while creating a platform for consumer convenient meal participation, differentiation and individualization?  Email us at: Steve@FoodserviceSolutions.us or visit:  www.FoodserviceSolutions.us for more information.