Expansion amongst organic retailers has slowed in comparison to previous years. Despite this, the segment remains an outstanding performer amongst traditional grocery retailers, which overall is a declining format.
Market stalls represented a dying format over the review period. Changing consumer preferences and competition from other channels have driven consumers away.
Bakeries are one of the better performing areas within traditional grocery retailers but are also constantly under threat from a combination of economic factors and competition from other grocery retailers. Consumers, despite preferring better quality, are heavily influenced by the economic situation and low purchasing power.
As a struggling channel, the convenience of other channels has driven customers away from traditional grocery retailers. Those areas that continue to perform well have generally focused on one or two distinguishing features.
Bakery and organic retailers are two areas in general to have bucked the overall decline in traditional grocery retailers. Bakeries in particular must differentiate from the growing presence of convenience stores in bakery products, as well as supermarkets, hypermarkets, Costco and the broad range of products available through the proliferation of cafés across Taiwan.
Traditional grocery retailers is a highly fragmented channel in Taiwan. There are few chains present with the bulk of retailers consisting of independent stores, often family run, servicing a purely neighbourhood demand.
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