I have seen the future of grocery stores

[DTEJD1997]

Hey all:

 

I did some traveling over the Christmas Holiday and I think I've seen the future of grocery stores, as I went into several of them.

 

A). Kroger is building MEGA grocery stores.  These stores are almost the size of a Wal-Mart, but they sell mainly groceries.  The one I went into had a health clinic in it.  It had 52 isles of food for sale.  The selection was pretty good, just about as good as anything outside of ethnic grocers or specialty places.  Prices were decent.  Store was simply MASSIVE, bordering on insane.  Arguably the best grocery outside of Wegman's.

 

B). I have seen and shopped in Lidl's.  This is an upscale German competitor of Aldi.  These guys are going to be a big threat to everyone else.  There prices are almost as low as Aldi, but they have a larger selection.  They have a small in store bakery.  I don't think their distribution network is built out yet in the USA.  They had a bunch of name brand frozen foods, I think they don't have their generic manufacturers fully up to speed.  Store was maybe 2-3X larger than the typical Aldi.  Very open & clean.

 

C). I went into an Aldi down the street from a Lidl.  This store is about 2X the size of a typical Aldi up North.  They have a slightly larger selection of products.  The store is also looking more upscale.  For instance, the isles are wider, there is somewhat softer & better lighting, there is exposed brick.  They also have an expanded and better produce section.  Employees seem more engaged.

 

So I think the days of "regular" grocery stores are rapidly coming to an end.  The low end is going to get taken up by Lidl & Aldi.  The mid-range is going to go to Kroger & Wal-Mart & regional "super stores".  The high end is going towards Whole Foods & Trader Joes.

 

The thing that really surprised me is the entrance of Lidl & reaction of Aldi.  These guys are really going to take market share.

[gg]

Where was the mega Kroger? Was it under any specific branding indicating its a better than normal kroger?

[DTEJD1997]

Where was the mega Kroger? Was it under any specific branding indicating its a better than normal kroger?

 

The Mega Kroger was branded as a "normal" Kroger.  It was located in NW Ohio.

 

There is a Mega Kroger not too far from me in Metro Detroit.  It opened less than a year ago. 

 

I seem to remember that the "average" grocery store was about 35K sq. ft. of space.  These new Mega Krogers are probably double that in size (or more)!

[boilermaker75]

They are turning the Kroger in West Lafayette, IN into one of these. It was already a large grocery store and it looks like it will at least double in size.

[DanielGMask]

I think the future of grocery stores is like the Whole Foods store at Bryant Park in New York. This article is very good about explaining the future of food retailers.

 

The rise of the Grocerant:

 

http://www.therobinreport.com/grocerants/

[sjh]

Yeah, I would bet quite some money that Lidl and Aldi will take a lot of market share in the US over the next few years. Both come from a much more competitive market for grocery stores (Germany) and offer great value for money compared to many other stores in the US. Also they did a lot in terms of branding recently, the stores are much nicer now (e.g. in-store bakeries).

 

There is a great biography on the Aldi founders (unfortunately only in German as far as I know), it's amazing how frugal those guys were and how they ingrained it into the corporate culture.

 

https://www.amazon.de/Die-Albrechts-Auf-Spuren-ALDI-Unternehmer

 

[Sullivcd]

The mega Kroger in my town is 113k square feet and always packed with college students who refer to it as Kro-Gucci. I almost never go because we have an Aldi and 3 other Kroger options and it is a 10 minute walk from frozen pizza to beer sections.

[rb]

Some thoughts on this.

 

Trader Joe's is owned by a branch of the family that owns Aldi. I think Trader Joe's is owned by Aldi Nord while the Aldi Stores in the US are owned by Aldi Sud or something like that.

 

Lidl in Europe is pretty much like Aldi. Not really upscale at all. Maybe they're following a different strategy in the US or maybe they seem more upscale because the stores are new.

 

These German guys do not mess around. When they came to Britain the destroyed the grocery business and there were some really fierce players over there.

 

I think Kroger's strategy is wrong. The global trend is towards smaller, more focused stores and they're building behemoths.

[Foreign Tuffett]

The grocery business is fiercely competitive, and is growing more so every day. As a consumer I love it, as an investor I'm staying away.

[Foreign Tuffett]

I think the future of grocery stores is like the Whole Foods store at Bryant Park in New York. This article is very good about explaining the future of food retailers.

 

The rise of the Grocerant:

 

http://www.therobinreport.com/grocerants/

 

The first sentence of that article reads "We live in an era of chaos." I'm all about writers getting the attention of their audience with an exciting intro, but that's a little too over-the-top.  :-\

[DanielGMask]

I think the future of grocery stores is like the Whole Foods store at Bryant Park in New York. This article is very good about explaining the future of food retailers.

 

The rise of the Grocerant:

 

http://www.therobinreport.com/grocerants/

 

The first sentence of that article reads "We live in an era of chaos." I'm all about writers getting the attention of their audience with an exciting intro, but that's a little too over-the-top.  :-\

 

Indeed! Though the article is good at explaining current trends.

[rukawa]

You have to think of the groceries stores in the context of meal delivery and prepared foods. I expect prepared meals segment to continue to increase in size. If you think of a busy person in a city who has no time to cook what do they want from a grocery store:

 

1) Fully prepared fresh meals that require minimal prep

2) staples like juice, eggs, milk, fresh fruits

 

I would guess that in the future far fewer people will cook from scratch. You might have convenience type stores to sell the staples. In this context a large grocery store makes no sense. Its just time wasting from the consumer point of view and its inventory is wasteful from the business point of view since most of it just sits there.

[Gamecock-YT]

The new thing here is having a bar inside the grocery store with a rotating selection of local craft brews. Very inexpensive, $3 high gravity beer, $6 glasses of wine. With daily specials taking the beer down to $2 a few times a week and the wine to $3.

[Guest cherzeca]

The new thing here is having a bar inside the grocery store with a rotating selection of local craft brews. Very inexpensive, $3 high gravity beer, $6 glasses of wine. With daily specials taking the beer down to $2 a few times a week and the wine to $3.

 

retail as an experience and not just utility

[StubbleJumper]

Hey all:

 

I did some traveling over the Christmas Holiday and I think I've seen the future of grocery stores, as I went into several of them.

 

A). Kroger is building MEGA grocery stores.  These stores are almost the size of a Wal-Mart, but they sell mainly groceries.  The one I went into had a health clinic in it.  It had 52 isles of food for sale.  The selection was pretty good, just about as good as anything outside of ethnic grocers or specialty places.  Prices were decent.  Store was simply MASSIVE, bordering on insane.  Arguably the best grocery outside of Wegman's.

 

B). I have seen and shopped in Lidl's.  This is an upscale German competitor of Aldi.  These guys are going to be a big threat to everyone else.  There prices are almost as low as Aldi, but they have a larger selection.  They have a small in store bakery.  I don't think their distribution network is built out yet in the USA.  They had a bunch of name brand frozen foods, I think they don't have their generic manufacturers fully up to speed.  Store was maybe 2-3X larger than the typical Aldi.  Very open & clean.

 

C). I went into an Aldi down the street from a Lidl.  This store is about 2X the size of a typical Aldi up North.  They have a slightly larger selection of products.  The store is also looking more upscale.  For instance, the isles are wider, there is somewhat softer & better lighting, there is exposed brick.  They also have an expanded and better produce section.  Employees seem more engaged.

 

So I think the days of "regular" grocery stores are rapidly coming to an end.  The low end is going to get taken up by Lidl & Aldi.  The mid-range is going to go to Kroger & Wal-Mart & regional "super stores".  The high end is going towards Whole Foods & Trader Joes.

 

The thing that really surprised me is the entrance of Lidl & reaction of Aldi.  These guys are really going to take market share.

 

 

I'd love to see a store like that just for the experience (kind of like how I like to visit a large Ikea store once).  But, after visiting the store on vacation, could you imagine yourself using the store on a regular basis?  Seriously, 52 aisles is not grocery shopping, but rather it's your trip to the gym.

 

In my neighbourhood, I have a number of grocery options within about 3~ish miles of my house, but I invariably end up using only two.  Both stores are 15,000 or 18,000 square feet, which was about right during the 1980s, but is about half of today's standard.  For most of my grocery needs, I am happy to visit the smaller stores as long as they are appropriately priced because I mostly use the peripheral aisles and I don't really want to walk a mile to buy a a couple of steaks, five pounds of potatoes, milk and a loaf of bread.  And I really don't want to walk an extra 100 feet as I pass by clothing, dishes and other housewares.  I just want to buy the ingredients to make supper and then to get the hell out of the store.

 

Am I alone here?

 

 

SJ

[Uccmal]

Hey all:

 

I did some traveling over the Christmas Holiday and I think I've seen the future of grocery stores, as I went into several of them.

 

A). Kroger is building MEGA grocery stores.  These stores are almost the size of a Wal-Mart, but they sell mainly groceries.  The one I went into had a health clinic in it.  It had 52 isles of food for sale.  The selection was pretty good, just about as good as anything outside of ethnic grocers or specialty places.  Prices were decent.  Store was simply MASSIVE, bordering on insane.  Arguably the best grocery outside of Wegman's.

 

B). I have seen and shopped in Lidl's.  This is an upscale German competitor of Aldi.  These guys are going to be a big threat to everyone else.  There prices are almost as low as Aldi, but they have a larger selection.  They have a small in store bakery.  I don't think their distribution network is built out yet in the USA.  They had a bunch of name brand frozen foods, I think they don't have their generic manufacturers fully up to speed.  Store was maybe 2-3X larger than the typical Aldi.  Very open & clean.

 

C). I went into an Aldi down the street from a Lidl.  This store is about 2X the size of a typical Aldi up North.  They have a slightly larger selection of products.  The store is also looking more upscale.  For instance, the isles are wider, there is somewhat softer & better lighting, there is exposed brick.  They also have an expanded and better produce section.  Employees seem more engaged.

 

So I think the days of "regular" grocery stores are rapidly coming to an end.  The low end is going to get taken up by Lidl & Aldi.  The mid-range is going to go to Kroger & Wal-Mart & regional "super stores".  The high end is going towards Whole Foods & Trader Joes.

 

The thing that really surprised me is the entrance of Lidl & reaction of Aldi.  These guys are really going to take market share.

 

 

I'd love to see a store like that just for the experience (kind of like how I like to visit a large Ikea store once).  But, after visiting the store on vacation, could you imagine yourself using the store on a regular basis?  Seriously, 52 aisles is not grocery shopping, but rather it's your trip to the gym.

 

In my neighbourhood, I have a number of grocery options within about 3~ish miles of my house, but I invariably end up using only two.  Both stores are 15,000 or 18,000 square feet, which was about right during the 1980s, but is about half of today's standard.  For most of my grocery needs, I am happy to visit the smaller stores as long as they are appropriately priced because I mostly use the peripheral aisles and I don't really want to walk a mile to buy a a couple of steaks, five pounds of potatoes, milk and a loaf of bread.  And I really don't want to walk an extra 100 feet as I pass by clothing, dishes and other housewares.  I just want to buy the ingredients to make supper and then to get the hell out of the store.

 

Am I alone here?

 

 

SJ

 

No, I avoid the big places like the plague.  I want to be in and out, and not walking a half mile to get groceries.  I have other ways to exercise.  Now, the average North American probably could use the exercise. 

 

I would think the future is more boutique shops.  One of the things I like about France, Italy, and Spain are the small shops with bread, chacuterie, and normal groceries. 

[DanielGMask]

Hey all:

 

I did some traveling over the Christmas Holiday and I think I've seen the future of grocery stores, as I went into several of them.

 

A). Kroger is building MEGA grocery stores.  These stores are almost the size of a Wal-Mart, but they sell mainly groceries.  The one I went into had a health clinic in it.  It had 52 isles of food for sale.  The selection was pretty good, just about as good as anything outside of ethnic grocers or specialty places.  Prices were decent.  Store was simply MASSIVE, bordering on insane.  Arguably the best grocery outside of Wegman's.

 

B). I have seen and shopped in Lidl's.  This is an upscale German competitor of Aldi.  These guys are going to be a big threat to everyone else.  There prices are almost as low as Aldi, but they have a larger selection.  They have a small in store bakery.  I don't think their distribution network is built out yet in the USA.  They had a bunch of name brand frozen foods, I think they don't have their generic manufacturers fully up to speed.  Store was maybe 2-3X larger than the typical Aldi.  Very open & clean.

 

C). I went into an Aldi down the street from a Lidl.  This store is about 2X the size of a typical Aldi up North.  They have a slightly larger selection of products.  The store is also looking more upscale.  For instance, the isles are wider, there is somewhat softer & better lighting, there is exposed brick.  They also have an expanded and better produce section.  Employees seem more engaged.

 

So I think the days of "regular" grocery stores are rapidly coming to an end.  The low end is going to get taken up by Lidl & Aldi.  The mid-range is going to go to Kroger & Wal-Mart & regional "super stores".  The high end is going towards Whole Foods & Trader Joes.

 

The thing that really surprised me is the entrance of Lidl & reaction of Aldi.  These guys are really going to take market share.

 

 

I'd love to see a store like that just for the experience (kind of like how I like to visit a large Ikea store once).  But, after visiting the store on vacation, could you imagine yourself using the store on a regular basis?  Seriously, 52 aisles is not grocery shopping, but rather it's your trip to the gym.

 

In my neighbourhood, I have a number of grocery options within about 3~ish miles of my house, but I invariably end up using only two.  Both stores are 15,000 or 18,000 square feet, which was about right during the 1980s, but is about half of today's standard.  For most of my grocery needs, I am happy to visit the smaller stores as long as they are appropriately priced because I mostly use the peripheral aisles and I don't really want to walk a mile to buy a a couple of steaks, five pounds of potatoes, milk and a loaf of bread.  And I really don't want to walk an extra 100 feet as I pass by clothing, dishes and other housewares.  I just want to buy the ingredients to make supper and then to get the hell out of the store.

 

Am I alone here?

 

 

SJ

 

The concept of Grocerant as the new Whole Foods is appealing and inviting. I certainly don’t think you are alone but I also think this board does not represent the average customer for any of these concepts. Besides there are no clothing isles in this type of store. It’s certainly not a small format but is all dedicated to food.

[DanielGMask]

Hey all:

 

I did some traveling over the Christmas Holiday and I think I've seen the future of grocery stores, as I went into several of them.

 

A). Kroger is building MEGA grocery stores.  These stores are almost the size of a Wal-Mart, but they sell mainly groceries.  The one I went into had a health clinic in it.  It had 52 isles of food for sale.  The selection was pretty good, just about as good as anything outside of ethnic grocers or specialty places.  Prices were decent.  Store was simply MASSIVE, bordering on insane.  Arguably the best grocery outside of Wegman's.

 

B). I have seen and shopped in Lidl's.  This is an upscale German competitor of Aldi.  These guys are going to be a big threat to everyone else.  There prices are almost as low as Aldi, but they have a larger selection.  They have a small in store bakery.  I don't think their distribution network is built out yet in the USA.  They had a bunch of name brand frozen foods, I think they don't have their generic manufacturers fully up to speed.  Store was maybe 2-3X larger than the typical Aldi.  Very open & clean.

 

C). I went into an Aldi down the street from a Lidl.  This store is about 2X the size of a typical Aldi up North.  They have a slightly larger selection of products.  The store is also looking more upscale.  For instance, the isles are wider, there is somewhat softer & better lighting, there is exposed brick.  They also have an expanded and better produce section.  Employees seem more engaged.

 

So I think the days of "regular" grocery stores are rapidly coming to an end.  The low end is going to get taken up by Lidl & Aldi.  The mid-range is going to go to Kroger & Wal-Mart & regional "super stores".  The high end is going towards Whole Foods & Trader Joes.

 

The thing that really surprised me is the entrance of Lidl & reaction of Aldi.  These guys are really going to take market share.

 

 

I'd love to see a store like that just for the experience (kind of like how I like to visit a large Ikea store once).  But, after visiting the store on vacation, could you imagine yourself using the store on a regular basis?  Seriously, 52 aisles is not grocery shopping, but rather it's your trip to the gym.

 

In my neighbourhood, I have a number of grocery options within about 3~ish miles of my house, but I invariably end up using only two.  Both stores are 15,000 or 18,000 square feet, which was about right during the 1980s, but is about half of today's standard.  For most of my grocery needs, I am happy to visit the smaller stores as long as they are appropriately priced because I mostly use the peripheral aisles and I don't really want to walk a mile to buy a a couple of steaks, five pounds of potatoes, milk and a loaf of bread.  And I really don't want to walk an extra 100 feet as I pass by clothing, dishes and other housewares.  I just want to buy the ingredients to make supper and then to get the hell out of the store.

 

Am I alone here?

 

 

SJ

 

No, I avoid the big places like the plague.  I want to be in and out, and not walking a half mile to get groceries.  I have other ways to exercise.  Now, the average North American probably could use the exercise. 

 

I would think the future is more boutique shops.  One of the things I like about France, Italy, and Spain are the small shops with bread, chacuterie, and normal groceries.

 

I’m from Galicia, Spain. The American concepts are way more apealling. Lidl and Aldi are successful in Spain because they are cheaper and carry their own gourmet brands. Still, most people buys at Carrefour.

[rb]

The new thing here is having a bar inside the grocery store with a rotating selection of local craft brews. Very inexpensive, $3 high gravity beer, $6 glasses of wine. With daily specials taking the beer down to $2 a few times a week and the wine to $3.

I'm sorry, I don't mean to be insulting. But if you think those prices are inexpensive you're delusional. I can walk into my liqueur store and buy high quality German beer for $2.10 (tall boys 500 ml). For $30 ($6 a glass) I can buy a good Burgundy. For $18-$24 I can buy a very good bottle of Cotes du Rhone. The quality of these wines are very likely much, much higher than what you get in your grocery store glass. These are regular price btw, no sales. I live in Canada where alcohol is expensive due to taxes. I'm sure the prices are lower in the US for these items.

 

I should mention that I am someone who has plenty of money. I consider the prices you've listed as very high and would not pay. The idea that an average person would consider that very inexpensive is incorrect to say the least.

[Uccmal]

Hey all:

 

I did some traveling over the Christmas Holiday and I think I've seen the future of grocery stores, as I went into several of them.

 

A). Kroger is building MEGA grocery stores.  These stores are almost the size of a Wal-Mart, but they sell mainly groceries.  The one I went into had a health clinic in it.  It had 52 isles of food for sale.  The selection was pretty good, just about as good as anything outside of ethnic grocers or specialty places.  Prices were decent.  Store was simply MASSIVE, bordering on insane.  Arguably the best grocery outside of Wegman's.

 

B). I have seen and shopped in Lidl's.  This is an upscale German competitor of Aldi.  These guys are going to be a big threat to everyone else.  There prices are almost as low as Aldi, but they have a larger selection.  They have a small in store bakery.  I don't think their distribution network is built out yet in the USA.  They had a bunch of name brand frozen foods, I think they don't have their generic manufacturers fully up to speed.  Store was maybe 2-3X larger than the typical Aldi.  Very open & clean.

 

C). I went into an Aldi down the street from a Lidl.  This store is about 2X the size of a typical Aldi up North.  They have a slightly larger selection of products.  The store is also looking more upscale.  For instance, the isles are wider, there is somewhat softer & better lighting, there is exposed brick.  They also have an expanded and better produce section.  Employees seem more engaged.

 

So I think the days of "regular" grocery stores are rapidly coming to an end.  The low end is going to get taken up by Lidl & Aldi.  The mid-range is going to go to Kroger & Wal-Mart & regional "super stores".  The high end is going towards Whole Foods & Trader Joes.

 

The thing that really surprised me is the entrance of Lidl & reaction of Aldi.  These guys are really going to take market share.

 

 

I'd love to see a store like that just for the experience (kind of like how I like to visit a large Ikea store once).  But, after visiting the store on vacation, could you imagine yourself using the store on a regular basis?  Seriously, 52 aisles is not grocery shopping, but rather it's your trip to the gym.

 

In my neighbourhood, I have a number of grocery options within about 3~ish miles of my house, but I invariably end up using only two.  Both stores are 15,000 or 18,000 square feet, which was about right during the 1980s, but is about half of today's standard.  For most of my grocery needs, I am happy to visit the smaller stores as long as they are appropriately priced because I mostly use the peripheral aisles and I don't really want to walk a mile to buy a a couple of steaks, five pounds of potatoes, milk and a loaf of bread.  And I really don't want to walk an extra 100 feet as I pass by clothing, dishes and other housewares.  I just want to buy the ingredients to make supper and then to get the hell out of the store.

 

Am I alone here?

 

 

SJ

 

No, I avoid the big places like the plague.  I want to be in and out, and not walking a half mile to get groceries.  I have other ways to exercise.  Now, the average North American probably could use the exercise. 

 

I would think the future is more boutique shops.  One of the things I like about France, Italy, and Spain are the small shops with bread, chacuterie, and normal groceries.

 

I’m from Galicia, Spain. The American concepts are way more apealling. Lidl and Aldi are successful in Spain because they are cheaper and carry their own gourmet brands. Still, most people buys at Carrefour.

 

Carrefours, at least the ones I have been in, are not very big compared to a Loblaws. 

 

Anyway, someone else suggested this board is not representative of most peoples shopping habits.  I know my Wife and I aren't. 

 

But, when I think about the many people I know, most avoid big grocery stores, so there must be a certain subset who love these things, and a subset who dont. 

[Joe689]

One thing that might be in common during this grocer transition is technology.  Technology will help the companies set themselves apart from the others. 

 

In comes Digimarc (DMRC),  I am invested heavily.

 

Digimarc has the technology for the invisible barcode.    It has been endorsed by GS1, the organization that  develops and maintains global standards if barcodes.  Invisible barcodes have tons of applications.  Faster checkout, self-checkout, theft prevention, and customer engagement.    The company will be at NRF 2018.  They already have deals with walmart,  wegmans, new seasons.  Some of Walmart's packaging is already Digimarc encoded.    They also have partnerships with CPGs which do the packaging.

 

Anyways, thought I would throw that name out there if you believe in the grocer revolution. 

 

Let me know if you do any DD on the company, and please share your opinion. 

[Guest cherzeca]

i would have thought the future of grocery was more and better online ordering and delivery.  are these super sized stores really distribution centers in disguise. with an army of delivery trucks outside?

[Liberty]

I'd buy about 80-90% of my groceries online if I could get them delivered home for about the same price it costs me to go into the store, and if I was confident enough in the seller to know that they'd keep problems to a minimum and food quality at least as high as in the store.

[Gamecock-YT]

The new thing here is having a bar inside the grocery store with a rotating selection of local craft brews. Very inexpensive, $3 high gravity beer, $6 glasses of wine. With daily specials taking the beer down to $2 a few times a week and the wine to $3.

I'm sorry, I don't mean to be insulting. But if you think those prices are inexpensive you're delusional. I can walk into my liqueur store and buy high quality German beer for $2.10 (tall boys 500 ml). For $30 ($6 a glass) I can buy a good Burgundy. For $18-$24 I can buy a very good bottle of Cotes du Rhone. The quality of these wines are very likely much, much higher than what you get in your grocery store glass. These are regular price btw, no sales. I live in Canada where alcohol is expensive due to taxes. I'm sure the prices are lower in the US for these items.

 

I should mention that I am someone who has plenty of money. I consider the prices you've listed as very high and would not pay. The idea that an average person would consider that very inexpensive is incorrect to say the least.

 

Liquor store is the same as a bar in Canada?

[rb]

The new thing here is having a bar inside the grocery store with a rotating selection of local craft brews. Very inexpensive, $3 high gravity beer, $6 glasses of wine. With daily specials taking the beer down to $2 a few times a week and the wine to $3.

I'm sorry, I don't mean to be insulting. But if you think those prices are inexpensive you're delusional. I can walk into my liqueur store and buy high quality German beer for $2.10 (tall boys 500 ml). For $30 ($6 a glass) I can buy a good Burgundy. For $18-$24 I can buy a very good bottle of Cotes du Rhone. The quality of these wines are very likely much, much higher than what you get in your grocery store glass. These are regular price btw, no sales. I live in Canada where alcohol is expensive due to taxes. I'm sure the prices are lower in the US for these items.

 

I should mention that I am someone who has plenty of money. I consider the prices you've listed as very high and would not pay. The idea that an average person would consider that very inexpensive is incorrect to say the least.

 

Liquor store is the same as a bar in Canada?

Grocery store is the same as a bar in the US?