There’s no debating the recent gains in fresh foods, deli and other perimeter hallmarks in Canada’s grocery arena. That’s not to say, however, that the centre of the traditional grocery store is in a losing battle with the areas surrounding it. In fact, the centre of store was responsible for growth of than more than $3 billion over the past five years.
When we look at share of wallet across the grocery landscape, the perimeter of the store has gained 2.2% over the past five years to now account for 44.6% of grocery store food sales. At the same time, however, the centre of store, which includes general grocery items, dairy and frozen foods, has seen its market share decline from 57.6% to 55.4% from 2011-2015. But while the perimeter is now winning in terms of market share in Canada, the centre of store is a strong driver of upward sales momentum, as major categories like general grocery, dairy and frozen foods have been responsible for growth of $3.1 billion in sales over the past five years.
When it comes to growth, all three centre of store categories are contributing, the grocery department accounts for 71% of gains, frozen food 15% and dairy 12% in the last year (52 weeks ended Sept. 19, 2015). While some centre store categories are under-performing, indulgent, convenient and healthy food products are driving growth.
But centre store growth isn’t limited to food. Category expansion has been fueled by the needs and desires of an aging population, and stores have evolved to meet them by offering new health and nutritional supplements, face care and incontinent products.
While many believe Canada’s centre of store is losing the battle, the numbers don’t lie. The centre of store isn’t dead. In fact, the perceived demise is grossly overstated. Retailers today need to focus on consumers who are redefining how and where we eat. Whether it’s out of home or on the go, the need for convenient and healthy options will continue to influence change, because in the end, consumers vote with their wallets.
For more information about what’s going on around Canada’s centre store, join us for our “What’s in Store” webinar on Jan. 13, 2016.