Just a few words about...Food retail
Food retail is at a crossroads. The need for a more sustainable business forces all actors to rethink their approach. At the same time, consumers buy more and more food online, a trend that deeply affects food retail pioneers. Some experts even consider that we are witnessing a 'retail apocalypse'. How does this revolution take place? Who are the new players? What are the key factors to continue growing? What are the new opportunities? Local or global, chains or independents, online or physical retail… the future of food retail is being built today!
In France, new players want to shake up the market
70% of French household food purchases are made in medium/small outlets, as well as in local supermarkets. Good news for chain operators, which were able to better cover the territory in recent years thanks to an intensive outlet expansion, especially in big cities. In the meantime, retailers have developed their e-food sales through websites, home delivery, and drive-thru service. Today, France comprises more than 4,000 outlets of drive thru service. A true and unique success in Europe (this service now represents 5.5% of the total food sales)! Yet, hyper and supermarkets remain the most popular stores, still ahead of specialized food stores. Investing in the development of private labels, they now reap the benefits of their efforts! And what about organic food chains? Their market share can’t stop growing (+20% in 2017)! In the first four months of 2017, 61 specialist organic stores and organic supermarkets were opened ; and the total turnover of the organic industry now exceeds 7 billion euros! Other new players are putting a spoke in traditional retailers’ wheel. For instance, Costco opened a store in the suburbs of Paris in 2017 and is now planning to open more than a dozen of wholesale clubs. In France, the food retail business changes very quickly, and French consumers are getting offered more and more options!
ITW with Jérôme Gayet, co-founder of the institut du Commerce Connecté ("Connected Commerce Institute")
Does the French market reflect worldwide developments?
"Yes, since the development of e-commerce has been growing in recent years, with more and more online offerings, including via mobile phone. There is also an increasing number of automatic checkouts in supermarkets, proof that France is perfectly at ease with the new technologies. That said, France maintains its own stand-out features, with an organic retail sector that is now well-established, far more than in other countries of Europe, and which continues to make great strides, in particular with the development of a more "general public" offering alongside the specialised offering. Another trend that is on the increase in France is - once again - the local store. Store chains are reinvesting heavily in town centres, particularly since millennials are less prone than their elders to jump into the car to do their shopping. Globally, there is also a rising sense in France of an experiential trend, which concerns all store categories, and is about rediscovering the real meaning of commerce, in other words: taste, sharing and pleasure. In this context, the hypermarket model, which has been subject to so many attempts to reinvent or transform it, continues to pursue its metamorphosis."