Global Food Retail Market Size and Share Outlook - Forecast Trends and Growth Analysis Report (2024-2032)

Global Food Retail Market Growth

Growing demand for healthy food products, the rise of online shopping, and the burgeoning popularity of convenience food products are some of the prominent factors aiding the market growth. Consumers are increasingly looking for organic and functional food products which has led several retail stores and supermarkets to create a separate section for them or open new stores and departments just for their storage and sales. In the aftermath of the pandemic in 2020, there has been a significant rise in online shopping for goods including food and grocery items, pushing the food retail demand.

Due to the busy lifestyle of the working population and college students, the demand for convenience food products such as ready-to-eat meals, and pre-cut fruits and vegetables is on the rise. As per the SATS solution group, the ready-to-eat sector in India is expected to witness a growth of 45 per cent in the next five years from the year 2024.

Several market players are promoting sustainability by offering transparency on their product’s carbon footprint to their consumers. For instance, Albert Heijn, a Dutch-based grocery retailer, is now sharing the climate impact of 1100 of its food and beverage products with its customers via its platform. This data also allows it to detect the problem areas and reduce the impact of those products.

Key Trends And Recent Developments

Focus on health and wellness, rapid e-commerce growth and sustainability initiatives are a few factors pushing the food retail market dynamics and trends. 

May 2024

Walmart launched store-label food brands as it seeks to appeal to younger shoppers who are not loyal to grocery brands and want chef-inspired foods that are more affordable. Walmart expects to have 300 products in the line by the fall, including frozen foods, dairy items, snacks, beverages, pastas, soups, coffee and chocolate. The prices range from under $2 to under $15, with most products costing under $5.

Health and Wellness

A key trend of the food retail market is that consumers are slowly becoming health conscious, leading to an increased demand for organic, plant-based, and low-sugar products. Retailers increase their healthy food offerings and enhance labeling transparency since the food retail market is slowly trending toward wellness and balanced diets.

E-Commerce Growth

Although online grocery shopping was first adopted a few years ago, it is still growing due to betterments in delivery technology and the power of personalized recommendations. The retailers participate in user-friendly digital platforms and efficient delivery systems to benefit from the rising demand for convenience and increase a larger market share.

Sustainability initiatives

Sustainability is the latest mantra that most retailers seem to be adopting through eco-friendly practices that allow reduction of packaging wastes, sourcing locally, and promotion of energy-efficient operations. Consumers favor brands committed to environmental responsibility and implementing sustainable sourcing practices. This is ultimately opening up new food retail market opportunities.

Global Food Retail Market Trends

Another important trend developing in the food retail market at this time is personalized shopping experiences, driven by advanced data analytics and artificial intelligence. These technologies are being used by retailers to deliver tailored product recommendations, dynamic pricing, and targeted promotions based on individual consumer preferences and purchasing behavior. This trend increases customer satisfaction and generates higher loyalty by creating more relevant and convenient shopping experiences and thus boosts the food retail industry growth. This ultimately increases engagement and sales in an increasingly competitive market.

Industry Outlook

The High Level Of Food Spending On Food Expenditure Drives Up The Growth In The Food Retail Market Globally.

The shares of consumer expenditure spent on food as a percentage of the whole showed quite a marked variation across countries in 2022, indicating different economic situations, levels of income, and living costs. In Myanmar, the share reached over 50% of consumer expenditure. High shares of consumer spending on food are an indication of a low overall income level, in which a high part of the budget has to be allocated to consumption for subsistence. This becomes a significant trend in the food retail market globally. 

In African countries, such as Angola, Ethiopia, and Tanzania, the share of food expenditure makes up about 30% up to 40% of the population, which reflects about the same trends: relatively low disposable incomes of the population in these countries versus a bigger cost of food compared to other consumer goods. For another type of country, Venezuela, which is still experiencing a severe economic crisis, 20% of food expenditure can characterize very high inflation and economic instability; thus, such changes can result in consumer shopping patterns.

In Asia, countries with the same range of 30% to 40% included Kazakhstan, Azerbaijan, and Iran, hence placing food at a high importance in household budgets against countries that vary in their degree of economic development. Also within this range were Belarus and Bolivia from Europe and South America respectively indicating that countries in similar economic conditions continued to have food as a major component of consumer expenditure.

This share was much shorter in wealthier countries like Australia and Bahrain, close to or a bit less than 15%. Then, the sum of total consumer expenditures in those countries was by far stronger and in most cases was returning 20-50 thousand US dollars per person. Consequently, shorter shares of spending on food in those countries suggest higher disposable income with a smaller share of income spent on meeting the requirements for food, and a stronger level of spending on other goods and services, thereby propelling the food retail demand growth. 

For instance, in both Brazil and Argentina, expenditure on food was within the moderate level, 20% to 30% of all expenditures. This implies that it was a middle-income level, suggested by the fact that food was not the overwhelming portion of the budget, which it is in lower-income countries. Costa Rica was also in this range, suggesting a similar economy. The importance of the spending patterns of differences among countries shows that larger amounts have been spent on food in lower-income countries, while the wealthier nations are represented by a smaller percentage relating to food and more with so-called reserve dispositions of other spending items.

Global Food Retail Industry Segmentation

“Food Retail Market Report and Forecast 2024-2032” offers a detailed analysis of the market based on the following segments:

Market Breakup by Product Type

• Cereals 
• Fruits and Vegetables  
• Meat and Seafood  
• Dairy Products 
• Breads 
• Others

Market Breakup by Distribution Channel

• Supermarkets and Hypermarkets 
• Convenience Stores 
• Online 
• Others

Market Breakup by Region

• North America
• Europe
• Asia Pacific
• Latin America
• Middle East and Africa

Food Retail Market Share

Supermarkets And Hypermarkets To Gain A Significant Share For Increased Availability Of Range Of Products

As per food retail market analysis, supermarkets and hypermarkets account for major market share owing to their increased accessibility and availability of a wide range of food products. They can offer a variety of goods, both food and non-food, thereby effectively meeting the different needs of the consumer, hence attracting more of them interested in variety and convenience in the purchasing experience. Moreover, these stores offer a broad assortment of products under a single roof and store discounts and coupons which makes them an attractive option for the consumers.

Adoption of Advanced Technologies and Unique Product Offerings are Driving the Growth of the Global Food Retail Market.

• The global food retail market offers a wide variety of products catering to different consumer preferences and dietary needs, thereby enhancing customer satisfaction and loyalty.
• Adoption of advanced technologies such as AI, IoT, and big data analytics in inventory management, personalized marketing, and improving the overall shopping experience.
• Strong and efficient supply chain networks ensure the steady availability of products to consumers and reduce the risk of stockouts.
• Major players in the market have strong brand recognition and customer loyalty that aids in sustaining a constant revenue generation stream, boosting the food retail industry revenue globally.

Logistics Costs and Food Safety Regulations Impact Profitability of the Global Food Retail Market

• Food retailing is a business that involves a number of logistics, storage, and manpower-related costs that significantly impact profit margins.
• The food products are such that they perish easily, meaning a greater percentage of them turn to become simple wastes in the absence of installed inventory management systems.
• The industry is heavily regulated, involving food safety and labeling and strong environmental standards, costing both in expense and complexity to implement.
• Food retailers suffer from reduced sales and profitability during periods of economic downturn when spending power is diminished, thereby impeding the demand of the food retail industry.
• Natural disasters, geopolitical tensions, pandemics, etc., can disrupt the supply chain, resulting in a shortage of products and an increase in their cost.
• Fast and changing consumer preferences and eating habits can make existing product lines irrelevant and call for continuous adaptation and innovation.

Fast Growth in Online Grocery Shopping and Consumers' Rapidly Growing Preference for Healthy Sustainably Sourced Products are the growth drivers of the Food Retail Market.

• Online grocery shopping has been on an increasing spree lately, which creates huge opportunities in terms of growth and expansion in the food retail market. 
• Rapid urbanization in emerging markets and increasing disposable incomes open new opportunities for higher sales and market expansion. 
• Growing consumer awareness about health and well-being will continue to drive demand for organic, non-GMO, and specialty diet products, creating opportunities for diversification and value pricing, pushing the food retail market revenue globally. 
• Coupled with this, the consumer moves towards sustainable and ethically sourced products give a unique way for retailers to differentiate their activity and build brand loyalty.

Food Retail Market Regional Analysis

The food retail industry in Asia-Pacific region is on course to assume a more prominent place in the food retail market, driven by its rapidly growing population, increasing urbanization, and higher disposable incomes. A growing middle class creates demand for diversified ranges of foodstuffs and modern retail formats. At the same time, technological innovation and growth in e-commerce, as seen in countries like China and India, shift the dynamics of the retail environment toward accessibility. This will place Asia-Pacific at the forefront of the evolving food retail market globally.

Competitive Landscape

The market players in the food retail industry are increasing their funding to invest in technology infrastructure and gain a competitive edge in the market.

Founded in 1962 and headquartered in Bentonville, Arkansas, Walmart Inc. has been one of the leading retailers around the world with regards to stressing convenience through online grocery delivery and curbside pickup. The company strives to reach a goal of zero waste by 2025 and looks to leverage advanced technologies such as blockchain and AI for customer experience and efficiency.

Kroger Company, based in Cincinnati, Ohio, was founded in 1883. It has large digital and e-commerce capabilities in delivery service and automated warehouses. The company looks forward to health and wellness by increasing organic products, reducing 50% of food waste by the year 2030.

Tesco PLC, founded in 1919 and headquartered in Welwyn Garden City, Hertfordshire, UK, has a mix of store formats ranging from hypermarkets to convenience stores. Saying that it would achieve zero carbon emission by 2050, reduce food waste through various charitable partnerships, and improve online shopping by advanced analytics for better customer service, Tesco does nothing but try to please its loyal customers.

Carrefour S.A. is a 1959 company based in Boulogne-Billancourt, France. It unites the storefronts of physical and digital to bring about one seamless customer experience. The firm promotes sustainable agriculture, encourages the development of local products, and builds a leading presence in emerging markets through strategic partnerships and acquisitions.

Costco Wholesale Corporation was founded in 1983 and is headquartered in Issaquah, Washington. Being involved in the bulk sale of goods makes it value-giving to the customer by price advantages and by private-label products that are not found anywhere else. The firm has been expanding its operations by opening new warehouse locations worldwide and maintains its commitment to sustainable sourcing and decreased environmental impact.

Other key players profiled in the food retail market report are 7-ELEVEN, Inc., Amazon.com Inc., ALDI, Inc., and Schwarz Unternehmenskommunikation GmbH & Co. KG, among others.