The UK food and grocery market will grow by 13% between now and 2020 to be worth £200.6bn, according to the latest forecasts by IGD.
The research firm says that online, discounters and convenience will remain the engines of growth, but adds that online sales, which is the fastest growing part of the market, will have almost doubled in value by 2020.
Discounters and convenience are both expected to see expansion, but growth will be slower over the next five years than the previous five, due in part to a lack of good locations for new stores. As the dynamics of the market change, IGD predicts that superstores and hypermarkets will experience a modest fall in sales by 2020 but they will still be the biggest slice of the grocery market.
11% of shoppers used discounters for ‘the majority’ of their shopping last month, and IGD says this momentum will remain strong, but it said growth would be harder as the pool of best locations gets smaller and the major supermarkets fight back.
Joanne Denney-Finch, IGD Chief Executive, said: “Convenience stores have a similar challenge in finding ideal new locations and face rising competition from other formats, including the discounters, for top-up shopping. They do, however, remain popular with shoppers. They are the most-used type of grocery format, with people visiting them 12 times a month on average. Given their large network, they have the benefit of being visible and available in many communities, which means most people have easy access to them.”
