Consumers Face Fewer, Pricier Options
Consumers across the US face increasingly diverse options when it comes to purchasing groceries. According to the latest survey of the Chicago-area grocery market from Mid-America Real Estate, the city “has five fewer grocery stores than it did two years ago, but the ones remaining are bigger and fancier,” reports the Chicago Tribune. Aldi now has the most stores in the area, at 51, with Jewel-Osco coming next at 49. In all there are now 278 grocery stores covering 9.86 million square feet, a 140,000 square-foot increase since 2013. Study co-author Dan Tausk projected that Fresh Thyme Farmers Market, Mariano’s, Whole Foods, and Target will boost their profile in the Chicago area over the next two years. Of those five up-and-coming area chains, three are considered “gourmet,” or more expensive for consumers. Overall, gourmet grocery stores have seen the fastest growth since 2013, with a 28% increase in square footage, in part due to the closure of all 72 Dominick’s stores in 2013.
What This Means For Small Businesses
Small businesses with a focus in the food sector may in particular find the new survey of Chicago-area groceries illuminating, as it points to the rise of higher-end groceries and the decline of more traditional grocery chains throughout the city. Small businesses need to know which direction the market is moving in order to better tailor their goods and services to area consumers. Clearly, demand from Chicago-area consumers is moving towards more upscale food products. This could have a negative effect on smaller, family-run corner groceries that may not have the means to purchase higher-end goods for customers.
Additional Reading
REJournals recently noted a study on Chicago-area grocery stores as anchor tenants in retail spaces.
Note: this article is intended to keep small business owners up on the latest news. It does not necessarily represent the policy stances of NFIB.
