According to research by Inmar Analytics, traditional supermarkets lost food retail market share to nontraditional grocery competitors and convenience stores in 2018. Last year supermarkets, fresh formats, limited-assortment stores, superwarehouses and small grocery stores saw sales drop 1.1%, lowering dollar share 1.7% year over year to 43.8%. In addition, the traditional supermarket store count fell by 0.5%.

On the other hand, in 2018 sales rose by 1.9% for wholesale clubs, supercenters, discounters, dollar stores and drug stores. The dollar share for these nontraditional grocery retailers rose 1.3% to 40% overall, and their store count rose by nearly 1%.

According to Inmar, sales totaled $1.25 trillion across all food retail formats in 2018, up 0.5% from the previous year. At the same time, overall store count was down 0.5%.

Inmar also stated in its report that the traditional grocery channel has lost more than half of its food retail market share since 1988, having dropped from 90% to 44%. Over the same time period, nontraditional grocery has gone from a 2% market share to 40%, and convenience stores from 8% to 16%.

“Traditional grocery stores can no longer expect to be successful by serving as CPG-supplied ingredient warehouses, enabling at-home meal preparation by stocking ubiquitous recipe requirements,” said Inmar Analytics Vice President Jim Hertel. “Seismic shifts in share within the $1.3 trillion food market are making that role increasingly untenable and unprofitable. The remaining pathway to growth is innovation.”

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