Sep 18, 2018

By: Steve Markenson, Director, Research, Food Marketing Institute
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As FMI prepares to release 68th annual edition of The Food Retailing Industry Speaks (Speaks) report, I thought I would give you a preview of what we will be revealing. I am happy to report that the food retail industry is riding a number of positive trends, while grappling with unprecedented challenges to their businesses. But food retailers have shown themselves to be resilient by taking proactive approaches and fine-tuning their strategies. The result has been an improved financial picture and renewed optimism for this year and the future.

Some of the initial finding for this year’s Speaks study include:

  • Financial Picture Improves: Same store sales advanced in the past year and retailers express a more optimistic sales and profits outlook going forward.
  • E-Commerce Gains Impact: Food retailers are widely experimenting with e-commerce and boosting space and labor allocations for online fulfillment as they strive to respond to the emerging business models.
  • Wellness a Big Positive: Consumer health and wellness proposition was cited as having the biggest positive impact on business, closely followed by the food as medicine trend.
  • Full Speed Ahead for Fresh: Even after years of growth, fresh foods segments are being tapped for bigger space allocations in the next two years, given that shoppers continue to gravitate towards these categories.
  • Private Brands Raise Profile: Food Retailers plan to make growing investments in this business segment, with many forecasting bigger space and SKU allocations for private brands in the next two years.
  • Health Costs Top Concerns: The major costs of providing health care benefits is considered to have a negative impact by 92 percent of respondents, making it the top concern. Other major worries are interchange fees, energy costs and competition from both brick and mortar and online players.
  • Competition from All Directions: Competition continues to impact sales and profits, though from slightly different sources than experienced in previous years. Competition from traditional food retailers was cited most often, followed closely by competition from non-traditional food retailers (not online) and online sales.
  • Finding Good Help is Hard to Do: Personnel issues round out the top concerns with a focus on wage pressure (including minimum wage and bonuses) and being able to attract and retain quality employees.

Learn more from FMI’s President and CEO Leslie Sarasin as she unveils this year’s study during a webinar on October 4th at 11AM.  Immediately following the webinar, the Speaks report will be available for download from the FMI store at www.FMI.org/Store.