Newcomers take to global grocery stage

By Anita Awbi

- Last updated on GMT

Related tags: Supermarket, Igd

Tesco and Wal-Mart are the undisputed champions of the
international grocery market, but little-known fringe grocers may
rise to eat into their margins over the next decade, says a new
report.

According to figures from Planet Retail, Wal-Mart continues to retain the supermarket industry's top spot, with sales of $339bn (£178.7bn) and a worldwide market share that almost equals the rest of the top five combined.

In 2005 the US-owned firm widened its lead over nearest competitor Carrefour, to take 6.1 per cent of the market. This was achieved through overseas expansion and fast domestic growth.

British firm Tesco, with a market share of 1.4 per cent, succeeded in closing the gap with Germany's Metro Group during 2005, and is the fastest growing retailer in the top five.

However, a recent report by IGD has revealed that the ten retailers to watch over the coming years are not necessarily global leaders.

The international food expert believes by studying the practices of up-and-coming supermarkets, firms can consider new ways of retailing and experiment with different channels for sales growth outside the global giant formula.

IGD's report highlights the Russian grocer Perekriostok, which is enjoying success from its "retailer for everyone"​ diversification policy. The firm expanded 53 per cent last year to achieve turnover of more than $1bn.

US-owned Whole Foods Market has also been hotly tipped. The organic specialist is arriving in the UK next year and looks set to immediately tap into the lucrative natural product trend. At home the retailer saw a 20 per cent jump in growth to bring in returns of $4.7bn.

"The focus of the 2006 Ten to Watch series is on differentiation, rather than price,"​ said IGD's Jonathan Gunz.

"A high level of customer service and a unique corporate culture or business ethos make a big difference for many retailers and can lead to their inclusion on our list."

Fifth on the list is Indian multi-format retailer Pantaloon that saw 66 per cent growth last year. The firm provides 'live kitchens' in its food bazaars where shoppers have their food cooked for them, and is proving popular on the domestic market.

Looking ahead to 2010, Planet Retail believes there will be very little change at the top, with Wal-Mart, Carrefour, Metro and Tesco still at the helm of global retail activity.

But the firm does acknowledge the likelihood of changes further down the list, and this may be where innovative new retailers take their place.

Related topics: Market Trends

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