Building on prior rounds of fiscal relief to counter the devastating effects of the COVID-19 pandemic, the American Rescue Plan was signed into law by President Biden in March 2021. The goal was to provide fiscal relief to individuals and businesses alike by sending one-time payments of USD1,400 directly to consumers earning USD75,000 or less per year, and authorising access to interest-free loans for small businesses via the Paycheck Protection Plan (PPP).
Composed of a variety of food and beverage retailers that run the gamut from liquor stores to butchers to farmers markets, individual operators within the traditional grocery retailers channel have experienced diverging performances over the course of the pandemic, with loosening in-person shopping restrictions and evolving consumer trends usually dictating the direction of sales in a particular category. For example, liquor stores that benefited from increased at-home alcohol consumption during widespread restaurant closures in 2020 saw something of a climbdown in 2021 as the foodservice industry reopened and consumers returned to bars.
Despite the heightened demand for groceries continuing largely unabated throughout 2021, traditional grocery retailers have not necessarily benefited to the same extent as their modern grocery retailing counterparts. Although a rising tide effect may have contributed to the year-on-year sales growth of independent small grocers, this is more likely attributable to natural recovery from an extremely challenging year.
2020 and 2021 were very profitable years for US liquor store operators, thanks largely to sustained increases in at-home alcohol consumption due to the fact that many bars and restaurants were closed or operating at limited capacity. Moving forward, however, the channel is facing many of the same supply chain issues that are dogging the rest of the industry.
In a time of diminished mobility, grocers must explore new ways of expanding their reach. The rise of e-commerce, particularly in grocery retailing, has mostly benefited large chains in modern grocery channels, such as supermarkets.
Independent small grocers were already feeling pinched prior to the pandemic, due to growing competition from larger retailing chains. Variety stores, in particular, have made grocery a key priority as they aim to compete with established legacy grocery players.
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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 DefinitionsThis report originates from Passport, our Traditional Grocery Retailers research and analysis database.
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