United States Value Grocery Shopping Market 2017 - The Future of Food Retailing

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Dublin, July 17, 2017 (GLOBE NEWSWIRE) -- The report has been added to offering. What could be said twenty years ago is even truer today: The U.S. food retailing business has never been more competitive. A number of trends are putting pressure on food retailers of all stripes, from supermarkets whose bread and butter is groceries to supercenters and drugstores for which food is a smaller but still crucial part of the product mix. Foremost are: 1) food deflation driven by heavy discounting; 2) shakeups among major chains; 3) heightened brick-and-mortar competition spurred by Germany-based discount retailers ALDI and Lidl; and 4) the incursion of e-commerce onto the food retailing landscape. For value grocers, the good news is that many of these trends bode well for the value grocery business as a whole. On the other hand, with the expansion of discount/limited-assortment chains including ALDI and Lidl, it appears value grocery will be at the epicenter of some of the most aggressive competition the grocery industry has seen since the Walmart-driven supercenter invasion of the 1990s. For a large majority and still growing number of Americans, value retailers are where it's at when it comes to grocery shopping. Supercenters attract 177 million U.S. adults as monthly shoppers (more than traditional supermarkets), wholesale clubs kick in 91 million, dollar stores draw 53 million, and discount/limited-assortment grocery chains like ALDI lay claim to 42 million.

And that's just for starters. As of early 2017, the value grocery business is heating up for what may be the hottest contest since the advent of Walmart supercenters. Not since Tesco's Fresh & Easy has a European grocery chain created such a buzz on the other side of the pond prior even to opening its first store, and right now the big word on the street is Lidl. Fresh & Easy was a colossal flop, but there's no reason to expect anything of the sort from Lidl, a German discount/limited-assortment grocery chains grocer à la Germany-based ALDI. Fielding more than 10,000 stores in Europe, Lidl has cut into ALDI's European business and, along with ALDI, forced into deep-discount mode massive competitors including Walmart's Asda U.K. grocery unit. As of early 2017, Lidl plans to open at least 100 U.S. stores per year on its way to a buildout of as many as 2,000 stores. Already on the defensive, ALDI has gone into accelerated expansion mode with the goal of growing its U.S. footprint to nearly 2,000 stores by the end of 2018 and by almost 50% during the next five years, accompanied by a $1.6 billion plan to remodel and expand 1,300 of its U.S. stores by 2020. Also girding for deep-discount battle is Walmart. In January 2017, Walmart announced plans to add 10,000 U.S. jobs and raise the minimum wage for its U.S. workers, and began testing a new low-price strategy aimed at undercutting ALDI and by extension Lidl. Like Target, Walmart is also investing in smaller stores designed to better compete with discount/limited-assortment grocery chains and dollar stores, the latter of which began cutting into Walmart's bread and butter during the Great Recession.

Also contributing to the ramped- up competition is e-commerce, particularly as Walmart and other grocers get serious about taking on Amazon and home delivery grocery services like Fresh Direct and Peapod. Outlaying several billion dollars, Walmart has snatched up e-commerce players including Jet.com, Shoebuy.com, and Moosejaw.com, and Walmart and other value retailers are now implementing bricks meet clicks services deigned to coordinate online grocery ordering with in-store pickup. Increasingly, such services involve smartphones and apps designed to help shoppers avoid lines and in some cases scan and pay as they go. This first-edition report also explores the future of natural and fresh foods vis-à-vis the value grocery shopper, the impact of private labels and name brands, and the transformative and increasingly overlapping Millennial and Hispanic cohorts. The report profiles value grocery retailers across four sectorssupercenters (e.g., Walmart, SuperTarget, Kmart), wholesale clubs (Costco, Sam's, BJ's), dollar stores (Dollar Tree, Family Dollar, Dollar General), and discount/limited-assortment grocery chains (ALDI, Lidl, Food 4 Less)and analyzes shopper behavior including penetration rates, preferences, cross-shopping at other grocery channels, demographics, and psychographics using trended multi-year Simmons consumer survey data. CHAPTER 1: EXECUTIVE SUMMARY TRENDS AND OPPORTUNITIES Supercenters Are No. 1 Grocery Retailer, Walmart Is Supercenter King Grocery Retailing More Competitive Than Ever The Changing Faces of Convenience Smaller Stores Bigger Than Ever Mobile Payments, Apps, and Screenless Payment Fresh and Natural Millennials and Hispanics: A Big Part of the Future of Grocery Retailing SUPERCENTERS AND MASS MERCHANDISERS Overview Retailer Profile: Walmart Stores, Inc. Retailer Profile: Target Corp. Retailer Profile: Kmart Retailer Profile: Meijer Retailer Profile: Fred Meyer WHOLESALE CLUBS Wholesale Clubs Account for Close to 10% of Grocery/Consumables Sales Retailer Profile: Costco Wholesale Corp. Retailer Profile: Sam's Club Retailer Profile: BJ's Wholesale Club DOLLAR STORES Dollar Store Channel Sees Growth and Consolidation A Lower-Income Customer Base, Plus Some Higher-Income Millennials Channel Buoyed by Great Recession and Heightened Focus on Food Retailer Profile: Dollar Tree Retailer Profile: Dollar General DISCOUNT/LIMITED-ASSORTMENT CHAINS Fewer Choices, Bigger Savings Retailer Profile: ALDI Retailer Profile: Save-A-Lot Retailer Brief: Food 4 Less CHAPTER 2: TRENDS AND OPPORTUNITIES CHAPTER HIGHLIGHTS MARKET OUTLOOKSupercenters Are No. 1 Grocery Retailer, Walmart Is Supercenter KingValue Grocers Outperforming Traditional GroceryGrocery Retailing More Competitive Than EverFood DeflationRetailer Upheaval: Consolidation, Reevaluation, and BankruptcyHere Comes LidlThe E-Commerce EffectUSDA Testing Online Acceptance of Food Stamps by Retailers Including AmazonThe Changing Faces of ConvenienceSmaller Stores Bigger Than EverBrick-and-Mortar Stores Emphasizing Online Ordering and In-store PickupMobile Payments, Apps, and Screenless PaymentFresh and NaturalPrivate Labeland Name BrandsMillennials and Hispanics: A Big Part of the Future of Value Grocery RetailingCHAPTER 3: SUPERCENTERS AND MASS MERCHANDISERSCHAPTER HIGHLIGHTSOVERVIEWTrends and CharacteristicsShopper Penetration Rates, Demographics, and Cross-ShoppingRETAILER PROFILE: WALMART STORES, INC.The World's Largest Food RetailerNeighborhood Markets Going StrongWalmart Testing Walmart Pickup and Fuel Stores and Convenience StoresWalmart on CampusWalmart Express Stores ShutteredBetter Wages, Better PerformancePrivate Label to Fill in the GapsApp-solutely: Scan and Go and Walmart PaySelf-Checkout, Home Delivery, and Store PickupSerious About e-Commerce: Walmart Acquires Jet.com, Shoebuy.com, and Moosejaw.com and Vows to Ramp up Digital Marketing InvestmentNo Shortage of Competitorswith More on the WayWalmart Claims 60% of U.S. Adults as Monthly Food ShoppersWalmart Supercenter Shopper DemographicsWalmart Supercenter Shopper PsychographicsRETAILER PROFILE: TARGET CORP.Company Seeking to Halt Sales SlippageWeak on GroceriesTarget Remodeling to Add Fresh FoodsTarget Testing Smaller-Format StoresTarget's Private LabelsTarget Claims 9% of U.S. Adults as Food ShoppersTarget Supercenter Shopper DemographicsSuperTarget Shopper PsychographicsRETAILER PROFILE: KMARTSteady Decline ContinuesKmart Attracts 5.2% of U.S. Adults as Food ShoppersKmart Supercenter Shopper DemographicsRETAILER PROFILE: MEIJEROne of America's Largest Privately Held CompaniesMeijer Claims 4.8% of U.S. Adults as Food ShoppersMeijer Supercenter Shopper DemographicsRETAILER PROFILE: FRED MEYERStrong in the Pacific NorthwestFred Meyer Claims 2.8% of U.S. Adults as Food ShoppersFred Meyer Supercenter Shopper DemographicsCHAPTER 4: WHOLESALE CLUBSCHAPTER HIGHLIGHTSOVERVIEWWholesale Clubs Account for Close to 10% of Grocery/Consumables SalesShopper Penetration RatesFood Shopper DemographicsCross-Shopping: Most Wholesale Club Shoppers Also Frequent SupercentersFood Shopper PsychographicsRETAILER PROFILE: COSTCO WHOLESALE CORP.A Time-Tested Company CultureLow Prices and Living WagesKeeping Prices DownMiles of AislesPrivate Label : Kirkland Signature Is an International Mega-BrandMarketing, Not AdvertisingCostco Claims 19.1% of U.S. Adults as Monthly Food ShoppersCostco Food Shopper DemographicsRETAILER PROFILE: SAM'S CLUBGroceries and Consumables Account for Over Half of SalesWorking to Improve Performance and ProfitsA Lower-Income Shopper BaseSam's Club Poaches Costco Shoppers Unhappy with Credit Card SwitchSam's Club Claims 8.4% of U.S. Adults as Monthly Food ShoppersSam's Club Food Shopping in Overall Sam's Club Context, 2014-2016 (monthly percent of U.S. adults shoppers)Sam's Club Food Shopper DemographicsRETAILER PROFILE: BJ'S WHOLESALE CLUBUp for Sale?BJ's v. Costco and Sam'sParing Private LabelAn Important Shopper Draw: Low-Price GasPickup and Pay and Online Deli/Bakery OrderingBJ's Claims 2.6% of U.S. Adults as Monthly Food ShoppersBJ's Food Shopper DemographicsCHAPTER 5: DOLLAR STORESCHAPTER HIGHLIGHTSOVERVIEWDollar Store Channel Sees Growth and ConsolidationA Lower-Income Customer Base, Plus Some Higher-Income MillennialsChannel Buoyed by Great Recession and Heightened Focus on FoodAdditional Expansion AheadDollar Store Shopper Penetration Rates, Demographics, and Cross-ShoppingDollar Store Shopper PsychographicsRETAILER PROFILE: DOLLAR TREE, INC.Sales and Store Count Surge Due to Family Dollar AcquisitionDollar Tree Number of Stores, 2011-2015Dollar Tree Net Sales, 2011-2015 (in billions of dollars)Family Dollar Acquisition Poses ChallengesDollar Tree and Family Dollar Shopper Penetration RatesDollar Tree Shopper DemographicsFamily Dollar Shopper DemographicsRETAILER PROFILE: DOLLAR GENERAL CORP.The Most Locations and Rapid ExpansionNew DGX Smaller Store Format Targets MillennialsFocus on Food (and Tobacco)Dollar General Plus and Dollar General MarketResponding to Dollar TreeDollar General Claims 10.5% of U.S. Adults as Monthly ShoppersDollar General Shopper DemographicsCHAPTER 6: DISCOUNT/LIMITED-ASSORTMENT CHAINSCHAPTER HIGHLIGHTSOVERVIEWDiscount/Limited-Assortment Grocery Stores: Fewer Choices, Bigger SavingsMarket Entry of Lidl Expected to Sharpen Competitive StakesALDI Out FrontCross Shopping Among Discount/Limited-Assortment Grocery ChainsRETAILER PROFILE: ALDIALDI: South v. NorthBare Bones Approach for Low Prices Keeps Shoppers SmilingGearing Up for Lidl: Accelerated Expansion and RemodelingALDI Demographics: Shoppers on a BudgetALDI Shopper PsychographicsRETAILER PROFILE: SAVE-A-LOTCompany OverviewPrivate Equity Firm Onex Buys Save-A-LotSave-A-Lot Leads Supervalu Chains by Number of ShoppersSave-A-Lot DemographicsComparison of Save-A-Lot (Onex) Shoppers vs. Shoppers for Selected Supervalu ChainsRETAILER BRIEF: FOOD 4 LESSPart of the Kroger Supermarket KingdomFood 4 Less Attracts 3.7% of U.S. Adults as Monthly ShoppersFood 4 Less Shopper DemographicsKroger Shopper Profile Much Less Distinct For more information about this report visit

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Related Topics: Food and Beverage, Food, Food and Grocery Retailing

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Globe Newswire: 14:15 GMT Monday 17th July 2017

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