[FUTURE #1] Grocery of the Future: Why Existing Fleets will Shape the Future

By June 24, 2019Insights

Speculation about the grocery store of the future is running high. But while much-publicized rollouts by Alibaba’s Hema, Amazon Go or the new startup Zippin suggest a cashier-free, robot-filled future, the biggest clue to what things will look like, at least in the near term, might just be the store where you already shop.

Change is coming, but you have to know where to look. 

The top six revenue-generating U.S. grocers (Walmart, Kroger, Costco, Ahold Delhaize, Albertsons and Publix) opened just 163 large-format grocery stores in the United States last year. It is a remarkably modest number given that at the end of 2018 these six chains operated a total 10,030 U.S. stores.

Most stores of the next five to ten years, in other words, will not be shiny, futuristic prototypes built from the ground up—they will be existing locations adapted to consumer demand.

Over the next few posts, we’ll look at how ambitious reinvestment strategies are likely to change U.S. grocery stores during this timeframe. Real estate moves slowly. How can retailers and shopping center owners maximize productivity in the near term?

  • In the first post, we’ll take a look at the outside of the store and co-tenancy—changes to the parking lot related to Uber, Lyft, click-and-collect, charging stations, densification, tenant adjacencies and more. (Spoiler alert: Driverless cars will not be ubiquitous in 10 years.)
  • Next we’ll do a deep dive into the store interior—how the center-store and perimeter will change; the potential impact of grocerants; the coming role of digital shelves and other store technologies; and the promise of partnerships.
  • Lastly, we’ll examine the evolution of fulfillment as it affects individual stores as well as whole networks. How will micro- and large-scale fulfillment centers affect physical footprints and online sales?

When paradigms shift, winners and losers emerge. Throughout this series, we’ll use a realistic lens to explore a key question: What will it take for our shopping centers and stores to thrive as the world changes around us?

Rachel Elias Wein

Rachel Elias Wein

Rachel Elias Wein founded WeinPlus, a strategy and management consultancy focused exclusively on retail and real estate organizations, in 2008. Ms. Wein serves as the principal strategic advisor for industry-leading public and private real estate owners and national retailers. With over 15 years of management consulting experience, Ms. Wein’s expertise is focused on leading enterprise-level strategic change.

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