UK Convenience Market Outpaces Total Grocery

June 9, 2009

Convenience retailing is outpacing the growth of the UK grocery market overall, new research from the IGD reveals.

The IGD’s new Evolution of Convenience Retailing report shows the UK convenience market grew by 6.1% to £29.1bn in the last 12 months. And, it forecasts the convenience market could be worth as much as £39.7bn by 2014.

Increase in number of forecourt stores

According to the IGD, new format innovation by retailers, new product development by manufacturers and broadened food-to-go propositions all offer growth opportunities for the convenience sector.

The study also reveals the changing dynamics within the market and a decline in the number of non-affiliated independents.

The report shows these declined by 5% to 21,950 in the last 12 months, driven partly by migration to symbol groups for their strong promotional packages, private label ranges and shopper mission based store formats.

The report also reveals:

• A slight increase in the number of forecourt stores to 8,641 – the first increase since 2002, driven by new openings and the re-commissioning of sites
• The participation of fresh food categories continues to increase and now represents 30% of sales
• The importance of stronger value propositions in the convenience market in a tough economic climate Stronger margins and the benefit of additional footfall continue to make food-to-go an attractive investment for convenience retailers
• Almost half (49%) of consumers who buy food or drink-to-go, choose a convenience store to make that purchase, significantly ahead of other outlets