Agriculture Reference
In-Depth Information
•
Supercenter
: a large combination supermarket and discount general merchandise store,
averaging 170,000 square feet of fl oor space. Grocery products account for up to
40 percent of fl oor space.
Total food store sales have climbed from $242 billion in 1986 to $600 billion in 2009
(
Figure 1.6)
. In 1986, grocery stores accounted for 89 percent of food sales, while warehouse
club and supercenter sales were inconsequential. Since then sales at warehouse clubs and
supercenters have steadily increased, accounting for 19 percent of food sales in 2009. This
growth has largely come from an erosion of sales at supermarkets, whose market share of the
food dollar for at home consumption has fallen to 66 percent. Other food stores have
accounted for roughly 15 percent of the market over time. They may be poised for growth as
the local foods movement gains traction (Martinez 2010).
Since 1997, the total number of grocery stores has fallen by almost 9 percent, to 63,384
stores in 2009 (
Figure 1.7
)
. The number of convenience stores and specialty stores has been
relatively stable at around 25,000 stores each over this time frame. In contrast, the number
of warehouse and supercenters has almost tripled, from 1,530 to 4,411 stores, as consumers
are drawn by the convenience of one-stop shopping and competitive prices.
The 1990s saw widespread consolidation in the grocery industry, as small “mom and
pop” chains were acquired or merged by larger grocers, who adapted to compete with the
entry into food retailing by Wal-Mart. This has resulted in fewer, but larger food retailing
fi rms.
Table 1.3
identifi es the ten largest chain stores in terms of total annual sales. Wal-Mart
has become the number one food retailer, followed by Kroger and Costco. This consolida-
tion has led to a steady increase in industry concentration. From 1992 to 2009, the market
share for the top four grocery fi rms more than doubled, from 17 to 37 percent, while the
600
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0
86
87
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94 95 96 97 98 99 00
Year
01 02 03 04 05 06 07 08 09
Grocery
Warehouse clubs and supercenters
Other food stores
Figure 1.6
Food sales by retail sector, 1986-2009
Source: Clauson 2010 .
