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Consumer trends in the UK Food and Grocery market

Full report: Structural Changes for UK Food & Grocery Sector

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This work forms part of a wider piece of research and is a downloadable in pdf format


3. More for less
Due to the pressure on household finances, consumers have prioritised value-for-money over choice, which in turn has reduced loyalty to retailers and allowed for the discounter to establish themselves in the market. The Big Four’s market share has declined to 68% in 2018 from just over 77% in 2011. In contrast, Aldi and Lidl have more than doubled their market share over the same period. 

4. Healthier lifestyles
Average calorie consumption has fallen by more than 8% over the last decade, and this trend towards consuming less calories is likely to have been driven by the popularity of healthy living. Consumers have a growing interest in the impact food has on our health and the environment, and the increased visibility of nutrition and ‘traffic light’ labelling has raised calorie consciousness. 

5. Shopping as an experience
The Retail Experience Economy touches all parts of the industry, from aesthetically pleasing supermarkets that invite consumers to relax and socialise, to omnichannel services that offer same-day delivery on products ordered on their phone or tablet. 

Broadly, the proportion of household income spent on recreation and culture, eating out, holidays and more general leisure pursuits has risen as consumers prioritise these activities. 

How retailers are reacting to consumer trends within the food and grocery market

With such diverse and impactful trends unfolding, the implications for retailers to adapt and consolidate are clear, if they are to remain relevant in this competitive industry. Store operation costs and pressures from wage policy (NLW and NMW) and Brexit continue to squeeze profit margins in an already precarious area. Find out what strategies retailers are adopting in order to remain competitive here

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This work was conducted by Retail Economics in partnership with Barclays Corporate Banking as part of a wider piece of research that focusses on a new era for UK food supply chains and the impact of Brexit. Here, we include an overview of the food and grocery sector since the turn of the century in Part 1 and look at current trends in Part 2. Part 3 focuses on the different Brexit outcomes and what this is likely to mean for the industry when it comes to costs and tariffs over the five-year post-Brexit period. Case studies are included, together with a look at Brexit tariffs, and lastly various industry trends to watch out for. 

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