June 13, 2019
The U.S. grocery industry is headed towards a near-term future that features a fully-automated checkout process, a greater emphasis on prepared meals, a proliferation of smaller, convenience-store grocery outlets, and more collaboration between grocers and nontraditional partners such as fitness operators and restaurants.
A new report from Los Angeles-based CBRE delivers 11 predictions for the U.S. grocery industry over the next decade. Grocery-anchored centers are favored by real estate investors due to the industry’s steady if slow sales growth and minimal e-commerce penetration relative to other categories. Still, U.S. grocers face significant pressure to adapt to changing consumer preferences, new store formats, automation and delivery demand, says CBRE researchers.
Melina Cordero, CBRE’s Global Head of Retail Research, says, “The store will remain central to the grocery industry, but its format and function will be reshaped by multiple factors over the coming years. Grocery operators must diversify their offering to best compete, which will lead to varied store formats for different markets, nontraditional merchandise assortments and an even greater focus on customer convenience.”
Among CBRE’s predictions:
– The grocery checkout line will disappear within 10 years as a slew of technological advancements arrive.
– Major grocery operators will expand further into convenience-store formats in order to capture strong growth opportunities.
– Collaborations will expand grocers’ offerings in an effort to add higher-margin merchandise and services in their stores to counter the steep costs of last-mile delivery.
– Intensifying competition spurs reinvestment in stores, which will also help improve in-store technology and omnichannel services such as curbside pickup.
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