FMI - The Food Industry Association’s annual comprehensive research report, The Food Retailing Industry Speaks 2022, concludes that "despite a challenging year marked by a persisting pandemic, historic inflation, supply chain bottlenecks, and labor shortages, the food industry is making significant investments to meet shoppers’ evolving tastes."
• "The survey finds that food retailers are focusing on investments in new technologies (73%) like foodservice ordering and delivery, dynamic pricing, and mobile checkout systems. They are also increasing labor allocation for online purchase fulfillment (52%) and in-store/curbside pick-up (48%)."
• "Retailers report they are also expanding numerous fresh or perimeter departments. More than 80% are increasing the space they allocate to fresh-prepared grab-and-go products as well as offering foods with beneficial nutrition attributes for health and well-being (70%). The departments expected to grow include locally sourced (72%) and organic produce (62%), plant-based foods and animal protein alternatives (64%), allergen-free (38%) and gluten-free (35%) SKUs."
• "Despite the macroeconomic challenges, a majority of retailers (61%) pointed to a positive impact on business sales and profits in 2021 from local and national economies."
• "On the other hand, food suppliers – surveyed for the first time in the 74-year history of the Speaks report – were less upbeat (50% positive, 36% negative). Both retailers and suppliers agree that the current economic climate will not be as favorable, with both retailers and suppliers anticipating that inflation will cause operating costs to increase (78% retailers, 90% suppliers)."
- KC's View:
The argument here always has been that when things get challenging, the worst thing a retailer can do is stop innovating and focus on "getting back to fundamentals." Let your competition do that … this is a perfect time to define and enlarge differential advantages, to innovate and promote. If you're not already doing the fundamentals, it is too late.