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The Future of Food Retailing in the U.S.


Attention: There is an updated edition available for this report.

Competition for the food dollar has never been greater, with more than a dozen types of retailers now vying for share of a retail market that is estimated to be worth anywhere between $450 billion and $612 billion. Traditional supermarkets are increasingly facing an identity crisis as they find themselves pressured by price/value players like Wal-Mart Supercenters and warehouse clubs like Costco and Sam’s Club on one side, and natural foods chains like Whole Foods on the other. Although the nation’s 34,000 supermarkets are still a dominant force in food shopping, their share of this business has rapidly declined, as has the frequency and extent of consumer shopping trips made to these outlets. Major demographic, lifestyle, and technological changes are creating a fertile environment for new concepts to entice shoppers, capture market share, and indeed re-invent the grocery industry.

The Future of Food Retailing in the United States, an all-new Packaged Facts report, examines the entire food retailing milieu, probing trends for growth and projecting sales by channel through 2010. It analyzes consumer demographics, lifestyle trends, and shopping behavior for their current and projected impact on retail sales. It provides up-to-date profiles of trendsetting retailers—including Safeway, Food Lion’s Bloom stores, Publix Sabor, Whole Foods, Wal-Mart, Costco, Dollar General, and many others; and discusses retail strategies such as Hi-Lo vs. Every Day Low Pricing (EDLP), private label, and “lifestyle stores.” The report also spotlights new technologies including RFID, biometrics, and smart carts, and identifies new marketing opportunities within the retail food business, such as meal-preparation businesses.

Report Methodology
The information in The Future of Food Retailing is based on both primary and secondary research. Primary research involved on-site examination of the retail milieu, interviews with marketing, public relations and industry analysts within the food market and consultants to the industry. Market size data was derived from Information Resources, Inc. Secondary research entailed data-gathering from relevant trade, business, and government sources, including company literature. New product information is gathered via literature research, personal interviews and data compiled by ProductScan, a service of Datamonitor. Consumer behavior patterns and data were derived from Simmons Market Research Bureau’s National Consumer Survey for Spring 2005.

What You’ll Get in this Report
The Future of Food Retailing makes important predictions and recommendations regarding the future of this market, and pinpoints ways current and prospective marketers can capitalize on current trends and spearhead new ones. No other market research report provides both the comprehensive analysis and extensive data that The Future of Food Retailing offers. The report addresses the following segments:

  • Retail Channels and Trends
  • Consumer Demographic, Lifestyle, and Shopping Trends
  • Retailer Strategies and Trends
  • Technology Trends
  • Retailer Profiles

Plus, you’ll benefit from extensive data, presented in easy-to-read and practical charts, tables and graphs.

How You Will Benefit from this Report
If your company is already competing in the food industry, or is considering making the leap, you will find this report invaluable, as it provides a comprehensive package of information and insight not offered in any other single source. You will gain a thorough understanding of the current food retail environment, and how demographic, food and technological changes will affect how retailers and manufacturers make and sell food and beverages in the future. Contributing to that understanding will be a complete analysis of sales data, and a detailed discussion of the consumer based on Simmons data.

This report will help:

  • Marketing Managers identify market opportunities and develop targeted promotion plans in the new food retailing environment.
  • Research and development professionals stay on top of competitor initiatives.
  • Advertising agencies working with clients in the food marketing and retail industries to develop messages and images that fit with the future of the industry.
  • Business development executives understand the dynamics of the market and identify possible partnerships.
  • Information and research center librarians provide market researchers, brand and product managers and other colleagues with the vital information they need to do their jobs more effectively.


  • Executive Summary
    • Scope and Methodology
      • Scope of Report
      • Report Methodology
    • Retail Channels
      • Overview: The Competitive Landscape
      • Total Grocery Sales Approach $818 Billion in 2005
      • Supermarkets Account for 56% of Food and Beverage Sales
      • Merging vs. Emerging Channels
    • Consumer Demographics, Lifestyle Trends, and Shopping Behavior
      • Shifting Demographics Reshape American Shopping and Eating Patterns
      • Specialty Food Consumers
      • Rising Mainstream Interest in Ethnic Foods
      • Tapping into America's Cultural Diversity
      • Changing Eating Patterns: At-Home Cooking Losing Ground
      • Competition from Foodservice Grows
      • Convenience as a Market Driver
      • The Wellness Factor
      • Natural/Organic Products Go Mainstream
      • Channel Surfing
    • Retail Strategies
      • Location, Location, Location
      • Dominate-Or Get Out
      • Is Downsizing the Future of Supermarkets?
      • Pricing Strategies: Hi-Lo vs. EDLP
      • Self-Service vs. More Service
      • Private Label Ripe with Opportunities
      • Organic/Natural Foods Another Huge Area of Opportunity
      • Targeting Ethnic Shoppers
      • No "One Size Fits All"
      • Turning Grocery Stores into Restaurants
    • Technology
      • Technology a Priority
      • The METRO Future Store
      • The Food Lion Model: High-Tech Stores Bloom in North Carolina
      • Emerging Technologies
    • Looking Ahead
      • Trends and Opportunities
      • Futuristic Technologies
  • Retail Channels
    • Overview: The Competitive Landscape
      • Definition of Retail Channels
      • FMI Definitions of Store Formats
      • Total Grocery Sales Approach $818 Billion in 2005
      • Market Share Shifts from Traditional Grocery Channels to Value Channels
      • Total Grocery Sales to Grow 12.5% by 2009, to $909 Billion
      • Food and Beverages Account for Half of Grocery Sales
      • Supermarkets Account for 56% of Food and Beverage Sales
        • Table Competitive Profiles of Retail Food and Beverage Channels, 2005
      • Merging vs. Emerging Channels
      • Recent Mergers and Acquisitions
    • Traditional Grocery Channels
      • Supermarkets on the Defensive
        • Table Top 10 U.S. Supermarket Chains by Retail Dollar Sales, 2004 (in millions)
      • Ethnic Food Markets Evolving
      • Limited Assortment Chains Making Waves
      • Natural Foods Stores Challenge Conventional Supermarkets
      • Gourmet/Specialty Stores
    • Value Channels
      • Supercenters Gaining Ground
      • Warehouse Clubs Proliferating
      • Dollar Stores Adding More Food to Their Product Mix
    • Convenience Channels
      • C-stores Seek to Broaden Their Appeal
      • Drugstores Also Compete on Convenience Front
    • Alternative Channels
      • Vending Machines Offer Convenience 24/7
      • Other Alternative Channels Target Impulse Sales
      • Home Depot to Open Convenience Stores
      • Online Shopping: A Renaissance for Online Grocers
  • Consumer Demographics, Lifestyle Trends, and Shopping Behavior
    • Consumer Demographics
      • Shifting Demographics Reshape American Shopping and Eating Patterns
      • Baby Boomers
        • Table Projected Population of the United States by Age, Sex, and Race/Ethnicity, 2000-2010 (in thousands)
      • Generation X
      • Kids and Teenagers
      • Yoga Mamas
      • The Role of Gender
      • Specialty Food Consumers
    • The Multicultural Marketplace
      • Rising Mainstream Interest in Ethnic Foods
      • Tapping into America's Cultural Diversity
      • Hispanics
      • African Americans
      • Asian Americans
      • Consumers of Kosher and Halal Foods
    • Lifestyle Trends
      • Changing Eating Patterns: At-Home Cooking Losing Ground
      • Competition from Foodservice Grows
      • Convenience as a Market Driver
      • The Wellness Factor
      • Natural/Organic Products Go Mainstream
      • Ethical Shopping
      • "Premiumization": A Taste for Luxury
      • Quality of Shopping Experience
    • Consumer Shopping Behavior
      • Channel Surfing
        • Table % of Households Buying by Channel: 52 Weeks Ending April 3, 2005 vs. 2003
      • Shopping Frequency
      • Shopping Trip Patterns
      • What Consumers Want
      • Shopper Demographics by Channel
      • Consumer Attitudes Toward Cooking and Food Shopping
      • The Impact of In-Store Advertising
        • Table Supermarket/Food Store Shopper Demographics, 2005 (U.S. adults)
        • Table Mass Merchandiser/Supercenter Shopper Demographics, 2005 (U.S. adults)
        • Table Convenience Store Shopper Demographics, 2005 (U.S. adults)
        • Table Drugstore Shopper Demographics, 2005 (U.S. adults)
        • Table Shopper Indexes by Retail Channel for Agreement with Statement: Really Enjoy Cooking, 2005 (U.S. adults)
        • Table Shopper Indexes by Retail Channel for Agreement with Statement: Like to Try New Recipes, 2005 (U.S. adults)
        • Table Shopper Indexes by Retail Channel for Agreement with Statement: Kitchen Is the Most Important Room in My Home, 2005 (U.S. adults)
        • Table Shopper Indexes by Retail Channel for Agreement with Statement: Like to Try Out New Food Products, 2005 (U.S. adults)
        • Table Shopper Indexes by Retail Channel for Agreement with Statement: Usually First to Try New Food Products, 2005 (U.S. adults)
        • Table Shopper Indexes by Retail Channel for Agreement with Statement: Enjoy Eating Foreign Foods, 2005 (U.S. adults)
        • Table Shopper Indexes by Retail Channel for Agreement with Statement: Try to Eat Gourmet Food Whenever I Can, 2005 (U.S. adults)
        • Table Shopper Indexes by Retail Channel for Agreement with Statement: Look for the Freshest Ingredients, 2005 (U.S. adults)
        • Table Shopper Indexes by Retail Channel for Agreement with Statement: Easy to Prepare Foods Are My Favorite, 2005 (U.S. adults)
        • Table Shopper Indexes by Retail Channel for Agreement with Statement: Often Eat Store-Made, Pre-Cooked Meals, 2005 (U.S. adults)
        • Table Shopper Indexes by Retail Channel for Agreement with Statement: Prefer Fast Food to Home Cooking, 2005 (U.S. adults)
        • Table Shopper Indexes by Retail Channel for Agreement with Statement: Shopping for Groceries Is a Bore, 2005 (U.S. adults)
        • Table Shopper Indexes by Retail Channel for Agreement with Statement: Shop for Specials or Bargains, 2005 (U.S. adults)
        • Table Shopper Indexes by Retail Channel for Agreement with Statement: Always Look Out for Special Offers, 2005 (U.S. adults)
        • Table Shopper Indexes by In-Store Advertising Impact by Retail Channel: Advertising on the Floor, 2005 (U.S. adults)
        • Table Shopper Indexes by In-Store Advertising Impact by Retail Channel: Messages/Offers at the Shelf, 2005 (U.S. adults)
        • Table Shopper Indexes by In-Store Advertising Impact by Retail Channel: Overhead Aisle Markers, 2005 (U.S. adults)
        • Table Shopper Indexes by In-Store Advertising Impact by Retail Channel: Advertising on Shopping Cart, 2005 (U.S. adults)
        • Table Shopper Indexes by In-Store Advertising Impact by Retail Channel: In-Store Demonstrations, 2005 (U.S. adults)
        • Table Shopper Indexes by In-Store Advertising Impact by Retail Channel: In-Store Samples, 2005 (U.S. adults)
        • Table Shopper Indexes by In-Store Advertising Impact by Retail Channel: Computerized Information/Coupon Center, 2005 (U.S. adults)
        • Table Shopper Indexes by Store Advertising Impact by Retail Channel: On the Internet, 2005 (U.S. adults)
        • Table Shopper Indexes by In-Store Advertising Impact by Retail Channel: Announcements In Store, 2005 (U.S. adults)
        • Table Shopper Indexes by In-Store Advertising Impact by Retail Channel: Radio/Public Address Announcements, 2005 (U.S. adults)
        • Table Shopper Indexes by In-Store Advertising Impact by Retail Channel: Video Monitor Displays, 2005 (U.S. adults)
  • Retail Strategies
    • Location, Location, Location
      • Dominate-Or Get Out
      • When Smaller Is Better and Less Is More
      • Pricing Strategies: Hi-Lo vs. EDLP
      • Razor-Thin Margins Are Standard Operating Procedure
      • Supermarket Slotting Fees: Will They Go by the Wayside?
      • Loyalty Programs
      • Category Management Roles Shifting
      • Self-Service vs. More Service
    • Merchandise Solutions
      • Private Label Ripe with Opportunities
      • Organic/Natural Foods Another Huge Area of Opportunity
      • Merchandising Health
      • Targeting Ethnic Shoppers
    • Lifestyle Stores & Other New Formats
      • No "One Size Fits All"
      • Lifestyle Stores
      • Unusual Layouts
      • Focusing on the Perimeter
      • Building Up Takeout
      • Re-Centering on the Center Store
      • Turning Grocery Stores into Restaurants
      • Samples and Demos Becoming More Widespread
    • Long-Term Solutions
      • Retail Strategies That Work
  • Technology
    • The Store of the Future
      • Technology a Priority
      • The METRO Future Store
      • The Food Lion Model: High-Tech Stores Bloom in North Carolina
    • Emerging Technologies
      • Radio Frequency Identification (RFID)
      • Thumbs Up for Biometrics
      • Personal Shopping Assistants/Smart Carts
      • Hand-Held Registers
      • Interactive Kiosks
      • In-Store TV Advertising
      • Giant and Stop & Shop Offer Consumers Free WiFi
  • Retailer Profiles
    • Trend Profile: 7-Eleven, Inc.
      • World's Largest Convenience Store Chain
    • Trend Profile: 99 Ranch Market
      • Asian Foods Specialist
    • Trend Profile: Amazon.com
      • The Online Bookseller Goes Gourmet
    • Trend Profile: Bloom, A Food Lion Market
      • The High-Tech Store to Watch
      • Another Food Lion Concept: Bottom Dollar
    • Trend Profile: Costco Wholesale Corp.
      • Overview
      • Fast Turn, Low Markup Create Competitive Edge
      • Focus Is Marketing, Not Advertising
      • How Far Can Costco Grow?
    • Trend Profile: Dollar General Corp.
      • The Dollar Store Leader-7,800 Stores and Growing
      • Growth Strategy
    • Trend Profile: FreshDirect, Inc.
      • Online Player Has Drive
    • Trend Profile: Publix Sabor
      • Targeting Florida's Latino Population
    • Trend Profile: Safeway, Inc.
      • New Lifestyle Positioning
      • New Lifestyle Format Stores
      • Extensive Private-Label Program
      • Safeway.com
      • Safeway's Wellness Initiatives
    • Trend Profile: Sam's Club
      • No. 2 and Trying Harder
    • Trend Profile: Sheetz, Inc.
      • Convenience Stores Go Upscale
    • Trend Profile: Target
      • Off-Base in Food?
    • Trend Profile: Trader Joe's Co., Inc.
      • The Offbeat Grocery Chain
    • Trend Profile: Wal-Mart Stores, Inc.
      • Overview
      • Success…
      • …and Controversy
      • Supercenters
      • Neighborhood Market Stores
      • Private Label and More
      • Tailoring Merchandise Mix to Local Tastes
      • Aggressive Growth Strategy: Wal-Mart Plans to Get Even Bigger
      • Pioneering Technological Advancements
    • Trend Profile: Wegmans Food Markets, Inc.
      • The Quintessential Upscale Supermarket
    • Trend Profile: Whole Foods Market, Inc.
      • Overview
      • Product Selection and Private Label
      • Growth Strategy
      • Looking Ahead
  • Looking Ahead
    • Meal Preparation Stores: Cooking Out-Eating In
      • Gunning for Whole Foods
      • X06: A New Gourmet Store Prototype
      • Drive-Thru Shopping
      • Store Swapping as a Retail Strategy
      • Futuristic Technologies
  • Addresses of Selected Industry Associations and Retailers

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