business news in context, analysis with attitude

The Wall Street Journal reports “recent upheaval in the U.S. grocery business is proving to be especially painful for regional supermarkets and their suppliers, creating opportunities for big-food retailers to further consolidate their position in the market.

“Increased consumer spending at discount grocers, club chains and e-commerce sites are forcing middle-market grocers and distributors to take stock of their finances, resulting in store closures or other steps to pare down debt. Traditional chains captured 44% of spending on food and beverages last year, down 6 percentage points from a decade ago, according to Inmar Willard Bishop Analytics, a market-research firm.

“There were 25,380 stores offering a full-range of groceries with at least $2 million in annual sales last year, down 6% from 2015, Inmar Willard Bishop found. The number of stores is expected to drop to roughly 19,000 by 2021, the firm says.”
KC's View:
If it has become an article of faith that the nation is over-stored, then this decline in the number of stores is probably a good thing … unless, of course, you are living in a place where suddenly you are going to have fewer options, or none.

One of the things that strikes me as likely is that it will be the mediocre, un-differentiated stores that will be in the most trouble. Which means that such stores and companies ought to be working overtime to address such conditions.