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Retail Design World have reported on the latest IGD forecasts which predict the convenience retail channel in the UK is set to be worth £47.2bn in 2023, a predicted growth of £7.1bn. The growth represents compound annual growth of 3.3 per cent for the sector.
“Growth in the convenience channel will come from a mix of activities. New store development will continue to be a key engine for the channel over the next five years, with the co-operatives, symbol and multiple retail segments leading the way,” says IGD senior business analyst Patrick Mitchell-Fox. “However, with the multiples taking a more conservative approach to expansion, we expect there to be an increasing focus on driving sales from existing stores too. This makes for a very positive outlook for convenience retailing and it remains one of the fastest growing channels in the UK food and grocery market.”
Mitchell-Fox says three key factors will underpin the growth:
A new generation of post-millennial shoppers – born between 1992-99 – has grown up with strong provision of convenience stores and expects longer hours and a wider range of products in convenience stores than previous generations.
Speed of shopping will become a big issue as more shoppers shift from a main weekly shop to more regular top-ups, further driving demand for shorter queues and faster payment methods.
More targeted offers from retailers will seek to entice shoppers into choosing food-to-go and evening meal products from convenience stores. As tobacco and newspapers decline as a driver of footfall they will be replaced by services such as fresh coffee, parcel collection and ‘dwell-space’.