FDBusiness.com

Big-box Supermarkets Left on the Shelf as Online Grocery Ordering Looks to Go Mainstream

 Breaking News
  • Ardgowan Unveils Plans For Inverclyde Distillery Ardgowan Distillery has revealed ambitious designs for its new £12 million distillery which is being built on the Ardgowan Estate near Inverkip, 30 miles west of Glasgow. The plans showcase the flagship building which has just secured revised planning consent from Inverclyde Council. The striking new design, by Michael Laird Architects, brings a number of improvements [...]...
  • HKScan Launches Exports of Finnish Poultry Products to Sweden HKScan, the Nordic food and meat group, has started exporting Finnish poultry products to Sweden. They will initially be sold through the largest retailer ICA’s outlets under the Karinäs®(Kariniemen®) brand. The launch gives Swedish consumers access to a new innovation: high welfare farm-born poultry that is hatched on the farm where it is raised. This new concept is [...]...
  • Almonds Retain Top Spot For Nut Introductions in Europe According to Innova Market Research’s latest Global New Product Introductions Report, almonds retain the number one spot for nut introductions in Europe. With a 47% share of global almond product introductions, the region leads globally for the eleventh year running. Europe as a whole saw a total of 5,017 new introductions with almonds – a [...]...
  • Arla Foods UK Launches New Standards Model to Bring Sustainable Change to Dairy Farming With ongoing volatility in the global milk markets, increasing consumer misunderstanding of the sector, polarised levels of support for UK dairy farmers and a new post-Brexit Agriculture Bill the challenges for dairy farmers are mounting. Farmer-owned co-operative Arla Foods has launched ‘Arla UK 360’ – a new standard in UK dairy farming. The Arla UK 360 [...]...
  • €172 Million to Promote EU Agri-food Products In and Outside the EU The European Commission will provide funding of €172.5 million from the EU agricultural budget to promote EU agri-food products in Europe and across the world. 79 campaigns, covering a wide range of products such as dairy products, olives and olive oil, and fruit and vegetables, will be rolled out over the next three years. Agriculture and [...]...

Big-box Supermarkets Left on the Shelf as Online Grocery Ordering Looks to Go Mainstream

Big-box Supermarkets Left on the Shelf as Online Grocery Ordering Looks to Go Mainstream
March 09
08:45 2015

The disappointing festive trading period for the big four supermarkets could prove to be catalyst harbinger for a major change to the way consumers shop for food, according to Nick Miller, Head of FMCG at global supply chain consultancy Crimson & Co. Nick Miller suggests we are now entering a new era that will see consumers swap trolleys and trips to the supermarket, in favour of online ordering as the preferred method of choice for putting food in our cupboards.

At the end of last year, each of the big four supermarkets (Asda, Morrisons, Sainsbury’s & Tesco), saw sales decline in the run-up to the Christmas period. The impact of this is just the latest in what has been a difficult year for the big retailers with Tesco recently announcing the closure of 43 stores, placing 2,000 jobs at risk, as well as Sainsbury’s looking to cut 500 head office jobs, as part of a drive to save money.

The fallout is expected to bring about big changes for the food retail sector, allowing other retailers, outside of the big four, to stake a foothold on the market. Miller suggests that those without an effective online ordering infrastructure could be left on the shelf.

Recent research from the Centre for Retail Research has predicted that 2015 will see online retail sales reach £52.25bn in the UK, a 16.2 per cent increase on 2014 when the total stood at £44.97bn. Supporting this, findings from research firm IGD stated that the online market is set to become the fastest growing channel for grocery goods over the next five years.

Nick Miller says that the downturn in sales for the big four supermarkets, and the potential uptake in online grocery shopping, will accelerate the decline of traditional superstores and hypermarkets, as well as opening the door for other retailers: “Previously, the barriers to embracing online shopping for consumers have centred around reach, product availability and quality. Limited delivery windows and poor product replacements dented consumer confidence. The growth in ‘anywhere customers’ have forced retailers hands and now we are starting to see companies offering greater choice as to how consumers purchase and collect their grocery shopping.

Crimson&CoLogo“Increasingly, supermarkets are offering same-day click & collect services meaning consumers are able to collect their shopping at designated collection points, at times which suit them. This for example, could be at their local train station on their return from work. Bigger products can also be collected from specific distribution centres close to the consumer, often within 24 hours of ordering, meaning no need to wait around for days on end, for an order to arrive.

“With confidence returning, all signs suggest that online shopping is rapidly becoming more mainstream and is here to stay. For the supermarkets themselves, the question that needs to be asked is where to go from here.

“Amongst the positives, there are threats to the supermarket firms, notably the rise of other major retailers encroaching on the market. The likes of Amazon and Google in the US have announced partnerships with food retailers offering delivery services – how long before we start to see this in the UK? The focus will be on making online ordering and deliveries much more economical, and it’s imperative that supermarkets react quickly to this.

“Additionally, the growth in online shopping will be off-set by the decline in consumers visiting the grocery big-box. Local authorities are increasingly challenging retailers when it comes to obtaining planning permission for new stores. And, with a shift away from the traditional weekly big-box shop in favour of online and top-ups at metro and local stores, we could reach a point when superstores and hypermarkets are surplus to requirements.

“While this dramatic shift is unlikely to take place overnight, what is apparent is there is now choice for consumers, outside of the big four. They no longer have to settle on hauling big, heavy trolleys up and down aisles on a weekly basis. The smartest retailers will be those to not only recognise this but action it.”

About Author

mike

mike

Related Articles



Food & Drink Business Conference & Exhibition 2016

Upcoming Events

  • October 21, 2018Int'l Food Products Exhibition (Sial)
  • October 25, 2018Italian Espresso Coffee Show (TriestEspresso Expo)
  • October 25, 2018Finnish Food Fair
  • October 31, 2018Int'l exhibition for food products and equipment (Indagra Food)
AEC v1.0.4

find food jobs

The Magazine

F&D Business Preferred Suppliers

New Subscriber





Subscribe Here



Advertisements