When the pandemic initially emerged in New Zealand, concerns around being exposed to the virus led to many consumers avoiding public places as much as possible, and this included lower footfall in traditional grocery retailers. As consumers spent greater time at home, home-cooking and baking trends rose significantly during the early restriction periods in 2020, causing many traditional grocery retailers to face a decline in sales – this was specifically notable in local bakeries.
Despite improving sales for the channel as a whole in 2021, with sporadic panic buying breaking out in February 2021 as Auckland was forced into lockdown, there was a notable reversal of this trend over the year as a whole, which had benefited some traditional grocery retailers as some consumers bought their staple goods from these stores. Demand for grab-and-go products remained weak as many New Zealanders continued to work from home.
Traditional grocery retailers need to adopt technology and e-commerce to meet changing consumer habits brought about by the pandemic as central business district and heavy foot traffic areas remained less populated largely because of travel restrictions alongside a lack of tourists. However, traffic has been diverted online as many retailers started to offer an e-commerce option for consumers who wanted a more convenient way to shop, while some bakeries such as Brumby’s and Fruit world already had an online presence.
Drink specialists continue to be an important segment within traditional grocery retailers, with Liquorland, Liquor Centre and Super Liquor leading the channel in 2021. Pre-pandemic consumer trends are likely to remain relevant heading into the forecast period as consumers increasingly consider low alcohol/carbs/calorie variants, and more sustainable options in addition to the search for authenticity in terms of provenance, craft and artisan, which highlight the increasing interest in local producers.
Drinks specialists are also likely to see further movement over the forecast period after the expansion of the North Island stores under the Liquorland banner. The Trusts (the Waitakere and Portage Licensing Trusts) will operate four Liquorland stores in West Auckland as part of a franchising agreement with Foodstuffs.
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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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