While traditional grocery stores are still the top outlet for purchasing fresh produce, mass retailers and supercenters are gaining market share, with 57% of shoppers purchasing fruits and vegetables from them in 2024, according to FMI — The Food Industry Association’s latest Power of Produce report.
According to retail expo, mass retailers and supercenters also saw an increase in produce dollar share whereas supermarkets and health/organic specialty stores have been losing share in the category since 2020.
According to retail expo, mass retailers’ uptick in produce sales comes as inflation continues to take its toll on shoppers’ spending.
Where consumers purchase produce has shifted to favor formats with “everyday low-price positioning” as shoppers struggle with reduced spending power, according to FMI’s latest Power of Produce report.
Shoppers purchase produce at an average of two to three different store channels, underscoring the “fractured nature of the fresh produce dollar,” FMI noted in its report.
While supermarkets have the largest share of consumers’ produce spending, they’ve lost $1.5 billion in sales in the category from 2020 to 2023. During this same time period, mass retailers and supercenters as well as club retailers saw an uptick in dollar sales, according to Circana data cited by FMI.
The percentage of surveyed shoppers who say they’re shopping for fresh produce online dropped to 37% in 2024 after spiking to 64% in 2020 and then holding steady at 46% in 2022 and 2023, according to FMI.
According to retail expo, current online shoppers are “quite devoted” to buying online, with 78% saying they will continue to shop this way, FMI noted. The trade association added that high-income shoppers are the most likely consumers to purchase groceries online and have a higher consumption frequency of fresh fruits and vegetables.
Regardless of the channel consumers buy produce from, the category's value is based on ripeness and appearance as much as it is on price. With more than 97% of produce sales happening in-store, FMI encourages retailers to highlight locally grown items, seasonal produce, sampling and availability of bulk selections.
Source: Retail Dive