Traditional grocery retailers in 2021 have seen a slight positive growth, in contrast to the broadly negative trends generated over the review period as these independent players were pushed out of the marketplace by modern grocery retailers. This lift was a result of people working and studying from home; consumers were more likely to shop at local neighbourhood outlets than bother traveling to larger stores.
Despite the limited bounce in value sales in 2021, the category is still, broadly speaking, in decline. Outlet numbers and selling space continued to decline in line with historic trends generated over the review period.
The pandemic has accelerated the adoption of e-commerce in traditional grocery in Latvia; this has been especially noticeable in more specialist grocery outlets who were frequently not exempt from the retail lockdown on non-essential stores. Alcoholic drinks specialists, for example, were permitted to sell alcoholic beverages online in 2020, a measure to support small businesses during the pandemic.
Vaccination and the government’s response to the crisis is bringing the pandemic under more control. As consumers return to pre-pandemic habits, the normal trend within this channel is likely to return – stagnation and decline, as traditional grocery retailers continue losing ground to modern grocery retailers.
The principal struggle for traditional grocery retailers over the review period has mostly been their inability to compete on price with modern grocery retailers. The arrival of German operator Lidl in 2021, the country’s first discounter chain, is likely to make this worse; all modern grocery operators seem set to be dragged into price wars over the forecast period, a trend that will make the competitive environment even harsher for traditional grocery retailers.
Latvia, like many other regional countries, has seen a surge in consumer demand for stronger green and sustainability offer from retailers. This is despite the comparatively higher price points of many of these products.
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Traditional grocery retailing is the aggregation of those channels that are invariably non-chained and are, therefore, owned by families and/or run on an individual basis. For Euromonitor traditional grocery retailing is the aggregation of three channels: Independent Small Grocers, Food/Drink/Tobacco Specialists and Other Grocery Retailers. While there can be modern (i.e. chained) food/drink/tobacco specialists or other grocery retailers, due to the store's presence in the channel, these stores are still considered as traditional for Euromonitor International.See All of Our Definitions
This report originates from Passport, our Traditional Grocery Retailers research and analysis database.
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