The battle for grocery sales has taken an unexpected turn as Supermarkets loose out to online stores and local corner shops.
Verdict, an independent retail analyst has released a report showing grocery market growth has slowed down to its lowest level since 2006. The slowdown in growth is partly due to grocery prices coming down which is good news for the consumer. However, other attributes are affecting the performance of the traditional supermarket.
Many supermarkets that are doing well have options such as internet shopping and even iPhone applications to make online shopping even easier, this solution of browsing online for your food and grocery shopping then getting it delivered at a convenient time suits many people who are either too busy to go to the supermarket or find it difficult getting to the cheaper stores.
People have less time to shop for deals as they did and with local supermarkets often at least a 20 minute drive away from your home many people prefer the option of internet grocery shopping, from the comfort of their living room or even in their lunch hour at work.
Supermarkets like Tesco and Asda have taken full advantage of this change in shopping trends and have even released iPhone and Android smart phone applications to make shopping online even easier so people can even shop online on the bus or the train home. This ease of access to grocery shopping means the internet has grown to become a huge market for grocery stores.
Another factor that has changed the way people buy groceries is changing demographics, people are living longer and these people find it difficult to get out to large supermarkets on retail parks. The age people are settling down to get married and have children is much older and many people are staying single up until their mid 30’s and 40’s this means a lot more households are single occupancy so the need for a large weekly shop is not as great.
With these changes to the way people are living we have seen that small, quick and frequent shops are becoming more popular and from this the local corner shop is picking up a lot of trade. People stopping in for their essentials every other day rather than going for a large supermarket shop every week.
Verdict predicts that these changes in lifestyle and demographics will see online shopping and convenience shopping boom over the next five years. By 2014 Verdict predicts online grocery sales will rise to 81% and reach £7.4bn and the convenience store market will grow by 14% to reach £35.7bn in the same timescale.
So how does this affect the food industry? Well, if these predictions are correct many food producers will need to make sure they have a good online presence, where once it was very important to get your brand into the supermarkets, now you need to make sure your brand can be found online. This will cut out the middle man in terms of profits but may require a significant investment. It is also worth getting into the local stores although this space will be limited in space but having your product there will create a lot of sales and exposure.
Article Source: http://www.abcarticledirectory.com
Montpelier Chartered Accountants are Accountants based all over the UK and have teams that specialise in accountancy for the food industry . Montpelier Chartered Accountants can help you not only with your accounting needs for your industry but also have a team of business advisors who can help you get the most from your business.
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