Retailing Formats

Non-traditional grocery retailers continued to grow their market share in 2010 at the expense of traditional supermarkets, according to Willard Bishop’s 2011 Future of Food Retailing report. This is a trend that will likely endure as the mass, drug and dollar formats expand their food offerings to attract shoppers. Consequently, traditional supermarkets will need to refocus on attractive pricing and promotional strategies to defend their business.

Food retailers were divided over whether the economic downturn impacted them positively or negatively. The range of performance varied widely for nearly every benchmark with some retailers losing significant ground in sales and profits in 2010, while net profits among the top-performing retailers are more than three times higher than the industry average, according to the Food Marketing Institute (FMI)’s 2011 Food Retailing Industry Speaks report. On the other hand, transactions and the average basket size took a hit and dropped to 11,680 transactions per store per week at $26.78 per transaction.

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