After a flat performance in terms of value sales in 2020, convenience stores experienced a decline in 2021 on the back of panic-buying reversal and a greater shift to online grocery shopping. Convenience stores located in city centres and close to airports continued to be particularly negatively affected.
Despite increasing price sensitivity, pushing consumers to search for the most affordable options, the economic impact across the country has spurred a strong movement in supporting local businesses and consumers have been frequenting convenience stores to replenish pantry items, as well as for on-the-go options as restrictions eased for certain periods.
Smaller format supermarkets, such as the New World Metro concept, threaten existing convenience stores as they are increasingly found in busy inner-city locations and densely populated suburban areas. Like traditional convenience stores, smaller format supermarkets have a strong appeal to time-poor consumers, who prefer shopping more frequently but for fewer items.
Challenges will remain for convenience stores heading into the forecast period due to subdued economic conditions, lower disposable incomes and reduced footfall, especially in city centre locations as travel restrictions remain in place. Affordability and wide product range remain key factors for local consumers, which puts independent convenience stores at a distinct disadvantage.
Foodstuffs (North Island) Ltd remained the convincing leader of convenience stores in 2021 in terms of value share and number of stores, followed by Foodstuffs (South Island) Ltd. The retailer’s Four Square chain benefited in 2020 from consumers wanting to shop local during the lockdown, with this trend being partially extended into 2021, although South Island stores recorded a stronger value growth performance at the end of the review period.
Post-pandemic trends are likely to remain relevant in New Zealand over the forecast period. Local consumers will continue to be cautious with the virus still in circulation, searching for contactless payments, expedited deliveries and click-and-collect services as well as in-store self-serve check-outs.
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Chained grocery retail outlets selling a wide range of groceries and fitting several of the following characteristics: Extended opening hours Selling area of less than 400 sq metres Located in residential neighbourhoods Handling two or more of the following product categories: audio-visual goods (for sale or rent), foodservice (prepared take-away, made-to-order, and hot foods), newspapers or magazines, cut flowers or pot plants, greetings cards, automotive accessories. Sales data excludes foodservice sales. Example brands include 7-Eleven, Spar. Note: The number of branches required to be termed chained varies from country to country but is usually ten or more. If a multinational is operating in the country, then this is included, even if there are fewer than ten outlets under the brand.See All of Our Definitions
This report originates from Passport, our Convenience Stores research and analysis database.
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