Food and grocery spending in UK convenience stores is projected to reach £43.2bn by 2028, analysts Globaldata report, growing at a compound annual growth rate of 2% between 2024 and 2028.
This growth will outpace the hypermarkets, supermarkets, and discounters channel, making it a prime opportunity for grocery players, it adds. All data was derived from GlobalData’s October 2024 monthly UK survey of 2,000 respondents.
Between 2023 and 2024, the traditional big four grocers - Tesco, Sainsbury’s, Asda and Morrisons - collectively added 800 new convenience stores to their portfolios, with Asda and Morrisons leading the growth with acquisitions. This rapid expansion underscores increasing competition in the convenience market.
After successfully focusing on price in large format stores to appeal to consumers during the cost-of-living crisis, grocers must shift their focus on agile pricing to convenience locations. Sainsbury’s and Tesco are notable examples within convenience, with Sainsbury’s recently introducing Aldi price matching in its Local stores and Tesco announcing price reductions on over 200 products in its Express stores.
Aliyah Siddika, retail analyst at GlobalData, said: “This replication of price focus from larger format stores to grocers’ expanding their convenience offer will encourage consumers to impulse buy due to increased affordability. The shift in UK consumer behaviour towards frequent top-up shopping has also created substantial growth potential in the convenience market.
“When offering deeper price cuts in convenience, grocers must target price promotions towards items that consumers are more inclined to purchase during the working week such as food-to-go , ready meals, quick dinners and treats to capture spending from commuters.”
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