Market Navigator: US Grocery Retailing—Igniting Unit Growth in a Low-Inflation Environment

Published – September 2024

Each Market Navigator report offers an in-depth, data-rich view of a retail, consumer or technology sector and is packed with data on sectors, segments, companies and consumers. Our analysts discuss at greater length the sector themes they are observing and the insights they are forming on their markets. We intend these definitive guides to serve as points of reference to those in the retail ecosystem, guiding readers’ strategic decision-making and assisting them in tapping opportunities and navigating disruption in retail and adjacent industries.

In this Market Navigator, Coresight Research explores the US grocery market. Dive in today to gain insights into emerging ideas and opportunities in grocery retailing, understand the growth trajectory of the market and explore the competitive landscape. You will also discover key insights about market factors and consumer behavior and preferences, based on proprietary survey findings. We also discuss key themes we are watching in US grocery retailing, aligning with our RESET framework. Key topics covered in this report include consolidation in the US grocery space, the impact of the Ozempic economy on US grocers, growing competition due to grocery discounters and grocery retailers’ sustainability efforts, among others.

Included with this Market Navigator: 

• Grab quick access to charts, data points and conclusions in the presentation download
• Access the data behind key charts and tables in the Excel download

Data in this research report include:

• Total and online market sizes and year-over-year growth rates, 2019–2028E
• Market breakdowns by category, distribution channel and product segment, 2017–2023
• Total inflation, food-at-home inflation, and the Finished Consumer Foods Producer Price Index, December 2021–June 2024
• Revenues, operating margins and store counts of leading retailers from across the US grocery market
• Proprietary survey data on where US consumers are shopping for grocery products (both in-store and online), and why they choose the retailers they shop

Introduction

What We Think

• Promotional Activity Will Increase
• Consumers Will Remain Value-Focused
• Grocery Consolidation Will Gain Momentum
• GLP-1 Risk Remains Minimal for Grocers
• Tighter Margins on the Horizon
• Sustainability Will Remain Crucial
• Social Responsibility To Drive Loyalty

Blue-Sky Thinking

• Consumer Demographic Shifts
• Vertical Farming
• Industry Concentration
• 3D-Printed Food

The US Grocery Sector

• Market Scale and Opportunity
• Channel Breakdown
• Online Market
• Market Factors

The Companies

• Competitive Landscape: Retailers
• Store Metrics
• Benchmarking to BEST
• Proprietary Survey Analysis: Where Consumers Are Shopping for Groceries and Why

Themes We Are Watching

• Responsive
• Engaging
• Socially Responsible
• Expansive
• Tech-Enabled

Macro Context

• The Coresight Research View on the US Consumer Economy
• Unemployment and Wages
• Real Disposable Income
• Savings Rate
• Interest Rates and the Housing Market
• Gasoline Prices and Consumer Sentiment
• Consumer Spending

Global Observations and Learnings

• Loss Prevention
• Discount Snack Stores in China
• Innovations in Checkout

Technologies with Potential

• Technology in the Grocery Sector
• Supply Chain
• Operations
• Customer-Facing

Real Estate and Store Openings/Closures

Retail Innovators

• Digital Wave Technology
• RELEX
• Swiftly

Notes and Methodology

Appendix 1: About the Coresight Research BEST Framework

Appendix 2: About the Coresight Research RESET Framework

Appendix 3: Ranking Retailers by Store Numbers

Appendix 4: Company Profiles

• Albertsons Companies (NYSE: ACI)
• Costco (NASDAQ: COST)
• Dollar General
• Dollar Tree (Nasdaq: DLTR)
• Koninklijke Ahold Delhaize N.V. (ENXTAM: AD)
• Kroger (NYSE: KR)
• Target Corporation (NYSE: TGT)
• Sprouts Farmers Market (NASDAQ: SFM)
• Walmart (NYSE: WMT)
• Weis Markets (NYSE: WMK)

79-page PDF report

Ahold Delhaize, Albertsons, Aldi, Amazon, BJ’s Wholesale, Costco, Dollar General, Dollar Tree, Kroger, Lidl, Private Label Manufacturers Association, Publix, Sainsbury’s, Sprouts Farmers Market, Target, Tesco, Trader Joe’s, Walmart

1. US Grocery Retail Market: Total Sales (Left Axis; USD Bil.) and Sales Growth (Right Axis; YoY % Change)
2. In-Store CPG Unit Sales: YoY % Change
3. US Grocery Market: Estimated Distribution of Grocery Retail Sales (%)
4. US Grocery Market: Segmentation by Key Product Categories (%)
5. US Online Food and Beverages: Total Retail Sales (Left Axis; USD Bil.) and Sales Growth (Right Axis; YoY % Change)
6. US Online Share of Food Retail Spend (%)
7. US Grocery E-Commerce: Top 10 Food and Beverage Categories by Sales
8. Food-at-Home Inflation and Total Inflation (YoY % Change)
9. Finished Consumer Foods PPI Vs. Food-at-Home CPI (YoY % Change)
10. Average Weekly Grocery Spending Per US Household (USD)
11. Respondents Who Have Observed Inflation: How They Have Changed, or Expect To Change, Their Shopping Habits in Grocery as a Result (% of Respondents)
12. US: Single-Person Households and Population of Those Aged 65+ (Thousands)
13. All Respondents: Which Retailers They Have Bought Food Products from in the Past Two Weeks by Average Age (Years) and Household Income (USD; 2023)
14. The US: African American, Asian-American and Hispanic or Latino Populations (Thousands)
15. Total US Food Spending: Food-at-Home vs. Food-Away-from-Home (%)
16. Leading US Grocery Retailers: Total US Revenues (USD Bil.)
17. Top Five US Grocery Retailers: Share of Total US Grocery Market (Ranked by FY23 Revenue; %)
18. Leading US Grocery Retailers: Operating Margins (Ranked by FY23 Revenue; %)
19. Key Comparable Metrics of Selected US Grocery Retailers (Ranked by FY23 Revenue)
20. US: Major Grocery Retailers’ Store Numbers (Ranked by Number of Stores)
21. US: Major Grocery Retailers’ Store Numbers (Ranked by Number of Stores)
22. Leading US Grocery Retailers: Sales Per Store (Ranked by FY23 Revenue; USD Mil.)
23. Leading US Grocery Retailers: Sales Per Square Foot (Ranked by FY23 Revenue; USD)
24. US Major Grocery Sector Retailers’ Store Traffic: YoY % Change (Ranked by FY23 Revenue)
25. The BEST Framework
26. BEST Framework and Benchmarking
27. In-Store Grocery Shoppers: Retailers from Which They Have Bought Groceries In-Store in the Past 12 Months (% of Respondents)
28. In-Store Grocery Shoppers: Reasons for Buying In-Store at a Particular Retailer (% of Respondents)
29. Online Grocery Shoppers: Retailers from Which They Have Bought Groceries Online in the Past 12 Months (% of Respondents)
30. Online Grocery Shoppers: Reasons for Buying Online at a Particular Retailer (% of Respondents)
31. Announced M&A Transactions in the US Food and Grocery Sector: Value (Left Axis; USD Bil.) and Total Number of Deals (Right Axis)
32. US Grocery Discount Channel and Total US Grocery Market: Annual Sales (USD Bil.)
33. Aldi US, Grocery Outlet, Lidl and Save A Lot: Total US Store Count
34. Aldi US, Grocery Outlet and Lidl US Grocery Store Visits (YoY % Change)
35. All Respondents: Which Retailers They Have Bought Food Products from in the Past Two Weeks (% of Respondents)
36. Dollar General, Dollar Tree and Family Dollar: Total US Store Count
37. H-E-B Lake Austin Blvd Store Vs. Neighboring Standard H-E-B Stores: Average In-Store Visit Duration, May 1, 2024–July 31, 2024 (Mins)
38. US Adults: Those Who Reported That There Was Either “Sometimes” or “Often” Not Enough To Eat in the Past Week (% of US Population)
39. US SNAP Recipients (Mil.)
40. SNAP Benefits: Total Amount Redeemed (USD Bil.)
41. Major SNAP Retailers: Count and Redemption Amount for Fiscal 2023
42. US Food and Beverage Private-Label and Name Brands: Dollar and Unit Sales Value Growth (YoY % Change)
43. US Food and Beverage Sales: Name Brand and Private-Label Sales Value (% of Total Sales)*
44. US Food and Beverage Sales: Private-Label Sales Value (Share by Department; %)
45. US Unemployment Rate (Left Axis; %) and US Average Hourly Wages (Right Axis; USD)
46. US Real Disposable Income: YoY Change (Seasonally Adjusted Annual Rate)
47. Personal Saving Rate (Left Axis; %) and YoY Change (Right Axis; PPTs)
48. New Housing Starts (Left Axis) and Case-Shiller Home Price Index (Right Axis; YoY % Change)
49. US Regular All Formulations Gas Price (USD per Gallon; Left Axis)* and University of Michigan Consumer Sentiment Index (Right Axis)
50. Identified Technologies with Relevance and Potential in the Grocery Sector
51. US Grocery Market: Number of Major Retail Store Openings, Store Closures and Net Store Openings
52. US Grocery Market: Major Store Openings in 2024*
53. US Grocery Market: Major Store Closings in 2024*

Appendix

1. BEST Framework
2. The RESET Framework
3. 50 Major Retail Banners Selling Grocery Products, Ranked by US Store Numbers