Retail Crisis Brewing in US

Ecommerce has been on the rise and revenues for online retail continue to ascend. The tug of war between digital and brick & mortar companies has been developing ever since the advent of ecommerce. But the fight for survival has yet to become brutal. With more and more consumers opting for digital platform to make their retail purchases, future of supermarkets seems bleak.
Industry experts anticipate a reactionary attack from supermarkets, with many retail stores planning to expand or launch their own ecommerce platforms in the coming years. Many supermarkets have competed by offering fresh food supplies and pharmacies in order to keep sales insulated from online retailers. But big digital retailers like Amazon are catching up. The need for strategy that can neutralize the looming threat from ecommerce to the brick & mortar is imminent.

The grocery business has been a safe haven for the retail stores, as other segments of shopping such as electronics and clothing already taken over by big online firms. Dollar stores (variety stores) chains have plans to expand substantially in the coming years. Also, the grocery prices have been falling for quite some time now in the US market, which has led to a budget conscious generation of consumers. This opportunity has been exploited by a variety of chains to increase their market share and start price wars which has forced the small retail stores, regional companies out of business. Adding to this is the changing buying behavior patterns of consumers, who aren’t buying at regular intervals as their parents. These buyers buy fresh food on a daily basis rather than replenishing their grocery stock weekly or monthly.

Up until now, ecommerce has struggled with groceries business for the past decade. But they have finally come up with a solution; hybrid stores. These stores will have an integrated shopping experience which inculcates best of online buying with in store shopping experience. With Amazon eyeing expansion into the Brick & Mortar by launching Pop Up stores across U.S., the existing giants in the supermarkets are mulling over strategies to expand geographically in an attempt to penetrate the market more vigorously.