FMI study details food retailers’ investments
Food retailers are making significant investments to meet shoppers’ evolving needs and tastes despite numerous challenges ranging from inflation to labor shortages to supply chain bottlenecks.
Food retailers are focusing on investments in new technologies (73%) that include foodservice ordering and delivery, dynamic pricing, and mobile checkout systems, according to an annual report by FMI — The Food Industry Association. They are also increasing labor allocation for online purchase fulfillment (52%) and in-store/curbside pick-up (48%).
The study, The Food Retailing Industry Speaks 2022, also found that retailers are expanding fresh or perimeter departments. More than 80% are increasing the space they allocate to fresh-prepared grab-and-go products as well as offering foods with beneficial nutrition attributes for health and well-being (70%).
The departments expected to grow include locally sourced (72%) and organic produce (62%), plant-based foods and animal protein alternatives (64%), allergen-free (38%) and gluten-free (35%) SKUs.
“A major trend that has emerged from the pandemic is shoppers are looking for fresher, healthier, more convenient options at their grocery store,” said Leslie Sarasin, president and CEO, FMI — The Food Industry Association. “Food retailers have absorbed this feedback and are making great strides to create both online and in-person shopping destinations that cater to shoppers’ evolving tastes.”
Despite the macroeconomic challenges, a majority of retailers (61%) pointed to a positive impact on business sales and profits in 2021 from local and national economies. On the other hand, food suppliers – surveyed for the first time in the 74-year history of the FMI Speaks report – were less upbeat (50% positive, 36% negative).
Both retailers and suppliers agree that the current economic climate will not be as favorable, with both retailers and suppliers anticipating that inflation will cause operating costs to increase (78% retailers, 90% suppliers).
“While inflation is a cause for concern for the food industry, it is much more concerning for American families who work hard to put food on their tables,” said Sarasin. “The food industry is committed to addressing these challenges so we can support families in the communities in which we operate by providing access to healthy and affordable foods.”
For more information and to download the report, visit FMI.org/GrocerySpeaks.