Get the app today! Download iPhone App Download Android App

IGD: UK Food And Grocery Forecast To Grow 15% By 2022

Published on Jun 7 2017 8:44 AM in Retail tagged: Trending Posts / Retail / UK / IGD

IGD: UK Food And Grocery Forecast To Grow 15% By 2022

The UK food and grocery market is forecast to grow by 15% between now and 2022, giving it a value of £213 billion (€243 billion), according to the latest forecast released by IGD.

The UK grocery-research organisation has said that it is predicting growth across all the major grocery channels, adding that the discounters are set to put in a ‘particularly strong performance, driven by ambitious store-opening programmes, new store formats and range investment’.

Joanne Denney-Finch, IGD chief executive, said, “There’s a revolution under way in food and grocery, in terms of what, how and where shoppers do their shopping. On average, shoppers say they use around 12 different stores every month – and, in the future, we will have an even greater choice in what, where and how we buy our food.

“We’ll be more spontaneous, but also better planned. We’ll be experimental, eager for new products and experiences, but we’ll also have perennial favourites, staples that we’ll buy on subscription. A quarter (24%) of British shoppers say, in the next two to three years, it’s likely they will use an online subscription service to get their staples delivered.”

Discounters

By 2022, IGD is forecasting that one in every £7 will be spent at a discounter, up from one in every £9, currently.

Discounters, including Aldi and Lidl, are currently worth £20.1 billion (€22.9 billion), but this is set to increase to £30.1 billion (€34 billion) – an increase of 49.8%.

Denney-Finch added, “Discounters will contribute most to the cash growth in the market over the next five years, as they continue to open new stores and keep improving the shopper experience, with new additions such as food-to-go, self-checkouts and larger stores. Four in five (79%) shoppers say they have visited a variety discounter for some of their grocery shopping in the last month, while two thirds (62%) say they used a food discounter. Almost three quarters (70%) of food-discount shoppers say the quality of the products they buy from these stores has improved over the last couple of years.”

Online

However, discounters are still not the (predicted) fastest-growing channel in the UK market. While not growing at the same pace as in previous years, the online market is set to increase by 53.8%, from £10.4 billion (€11.8 billion) to £16 billion (€18 billion).

However, Denney-Finch believes that the retailers that have started to refocus their efforts on the in-store experience will provide more competition for online markets, slowing its impressive rate of growth.

She adds, “The size of the prize in online still remains huge. We expect to see the ‘digital native’ – those people who have grown up using technology in many aspects of their lives – help to sustain growth in the future, as they carry on shopping online for groceries and potentially convert others to do the same. In the last month, 40% of all British shoppers say they have bought some of their food and groceries online, but looking ahead to the next two to three years, that figure rises to 60% of shoppers who say it’s likely they will shop online.”

Larger Markets

One of the most notable results from the report is the decline in popularity forecasted for supermarkets and hypermarkets in the UK. They see a combined growth of approximately 6.9% (hypermarkets: 1%; supermarkets: 5.9%), staggering behind online and discounter stores. While they still remain the place where most people shop, holding the highest value of sales [hypermarkets: £16.3 billion (€18.6 billion); supermarkets: £91.1 billion (€104.2 billion)], they are far from the UK’s biggest engines of growth.

© 2017 European Supermarket Magazine – your source for the latest retail news. Article by Aidan O’Sullivan. Click subscribe to sign up to ESM: The European Supermarket Magazine.

Share on Facebook Share on Twitter Share on Google+ Share on LinkedIn Share on Tumblr Share via Email