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UK Convenience Stores Cash in on Growth of Top-up Shopping

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UK Convenience Stores Cash in on Growth of Top-up Shopping

UK Convenience Stores Cash in on Growth of Top-up Shopping
May 20
09:27 2016

Business in UK convenience stores appears to be booming due to the growth of top-up shopping. New research from Mintel reveals that over two in five (45%) British consumers say they regularly visit convenience stores to do a top-up shop, whilst 7% visit the stores for their main weekly or monthly shop. Of those who visit convenience stores, three in five (59%) visit twice a week or more, with 12% shopping 4 to 6 times a week, and 5% saying they do so daily.

The growth in the convenience sector has been driven by a shift in grocery habits from consumers who are looking to cut down on the time spent grocery shopping. Mintel research indicates that it is the flexibility of convenience stores that is key for today’s time-pressed consumer as three quarters (75%) of Brits say the opening times of convenience stores make it easier to fit shopping into their daily schedule, whilst half (49%) say that shopping at convenience stores allows them to be more flexible with their meal choices.

Nick Carroll, Retail Analyst at Mintel, comments: “The increasingly busy nature of modern life means that across categories consumers are looking to cut back on the time that it takes to do certain activities. Grocery retailing is no different, and the convenience sector is perhaps the best suited to take advantage of this. As a result, the market is flourishing.”

Indeed, the convenience sector grew by an estimated 1.8% in 2015 to reach £38.7 billion. Whilst this represents a slowdown of the 2.8% growth seen in 2014, it remains higher than the wider grocery sector which is estimated to have seen a 0.2% fall in sales in 2015. The market is forecast to grow 13% over the next five years to reach £43.8 billion in 2020.

In addition to top-up shopping, convenience stores are also benefiting from growth in other grocery channels, notably online and discount shopping. Indeed, whilst 22% of Brits say they regularly do their main shop in a discount supermarket, nearly half (46%) of this group say they regularly top up their shopping in convenience stores. What’s more, whilst 24% of Brits regularly do their main shop online, 56% of this group say they regularly visit convenience stores for top-up shopping.

Alongside discount and online shoppers, younger consumers in particular are making full use of convenience stores. Over half (56%) of Brits aged 18-24 say they regularly use convenience stores, with 14% of this age group using the stores for their main weekly or monthly shop.

“Increased interest in both discount and online grocery shopping is benefiting the convenience store market as both of these channels require a level of top-up shopping. Consumers are increasingly looking for convenience in all aspects of their grocery buying experience. That is why we have seen a shift to more fluid grocery shopping habits with consumers, particularly among younger consumers, shopping on a more when-needed basis. Younger consumers are more likely to live in urban areas, meaning that a full shop isn’t possible due to limited space,” explains Nick Carroll.

MintelLogoIndeed, Mintel research indicates that those living in towns and cities are more likely to rely on convenience stores. Of consumers living in an urban location, over half (52%) regularly visit a convenience store compared to two in five (41%) who live in a village or rural location. Londoners in particular make full use of convenience stores, with 62% saying they regularly use convenience stores for grocery shopping. Of this group, 64% say they use the stores at least twice a week.

When visiting convenience stores, it seems it’s fresh food that shoppers are most likely to purchase. Of those who regularly shop in convenience stores, over half (57%) say they regularly buy freshly baked goods, and 55% say they regularly buy fresh food.

However, Mintel research reveals that consumers are reliant on convenience stores for more than just their FMCG (fast moving consumer goods) products. Of those who use the stores, over half (57%) have used an ATM in the shop over the past six months, whilst approaching 32% have used a Post Office and 21% click-and-collect services.

“It is notable that click-and-collect is now the third most used service in convenience stores after ATMs and Post Office services. We see this as a great example of how online and the high street are supporting each other. They are not in competition so much as being complementary. The offering of click-and-collect services is now being viewed as a necessity amongst consumers,” Nick Carroll concludes.

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