Independent Grocers Holding Their Own, Study Finds

Major players in the grocery business continue to consolidate – Kroger is pushing ahead with its 10-month-old effort to buy Albertsons, which would result in a combined operation of 4950 stores, and just last week Aldi’s said it is buying the Winn-Dixie and Harveys Supermarket chains, adding about 400 stores in the Southeast U.S. to its operations.

Despite those moves and others along the same lines, independent grocers are holding their own, a new study by the National Grocers Association (NGA) and FMS Solutions concludes. The study includes financial data from 521 independent grocers representing nearly 2000 stores for fiscal year 2022, which ran through March 31, 2023.

“Inflation, competition and continued supply issues were just some of the challenges facing independent grocers in 2022,” said NGA President and CEO Greg Ferrara. “However, independent grocers did what they do best: pivot to meet the everchanging marketplace opportunities and challenges. Independents reinvested into their stores and built or expanded loyalty programs, e-commerce platforms and digital marketing.”

In a similar vein, FMS President and CEO Robert Graybill said, “Independent grocers’ knowledge of the marketplace, grit and nimbleness resulted in a solid year in most key metrics.”

Among the metrics the study examined was employee turnover, which remains an issue for independents. “Despite the challenges, only 35 percent have turned to automation solutions to fill labor gaps,” added Graybill. “Independent grocers are known for customer service and are carefully evaluating the impact of consumer-facing automation.”

According to the NGA, the U.S. is home to 21,574 independent grocers, accounting roughly a third of all retail grocery sales.

Click here for more specific findings from the study.