The global Food and Grocery Retail Market Market will grow to a value of USD 12.8 Trillion during 2025 and it is expected to reach USD 17.7 Trillion by 2035 with a projected compound annual growth rate of 3.3% throughout 2025 to 2035.
The food and grocery retail market is a complex web of interdependence. This is now the palette from which we can choose: fresh fruits, vegetables, packaged snacks, beverages, and essential household items everything is part of the food and grocery retail market. This market, which is also the grocery store that has undergone a dramatic transformation, has been significantly impacted by factors like urbanization, rapid technology developments, and consumer desire for comfort.
For a large part, urban areas are the ones experiencing more and more the demand for quick-access food and grocery retail places, which has driven a corresponding rise in both traditional stores and internet grocery platforms. The present-day consumer prefers an excellent shopping experience be it in the traditional supermarket while buying groceries or in the internet supermarket while ordering for home delivery.
The innovation of technology has an essential role to play in changing the food and grocery retail market. Retailers are utilizing the latest technologies such as AI, data analytics, mobile apps, etc. to improve the consumer shopping experience and at the same time boost the operation of the business. Retailers can use AI and data analytics to understand the preferences of their customers better and can adjust their inventory and marketing plans accordingly.
Mobile apps and online platforms have completely altered the way people purchase groceries as they now provide inclusivity and a broader range of products. These technological advancements have not solely led to better efficiency in the company but they have also freed the consumer to have more choices and also to be in charge of the whole shopping experience.
| Attributes | Description |
|---|---|
| Estimated Global Industry Size (2025E) | USD 12.8 Trillion |
| Projected Global Industry Value (2035F) | USD 17.7 Trillion |
| Value-based CAGR (2025 to 2035) | 3.3% |
The food and grocery retail market, which is competitive in nature, has both the giants and local businesses in the field. The market is dominated by multinationals, which include Walmart, Tesco, and Carrefour, who use their wide range of goods and aggressive pricing strategy as weapons. At the same time, local and regional supermarkets are indispensable by the fact that they are the only ones that specifically meet the needs of the area.
They typically provide individualized service and wellness of local producers. In addition, the grocery market is experiencing a trend in sustainability and ethical sourcing. More and more consumers are becoming aware of the environmental and social aspects of their purchases, which forces retailers to implement environmental practices, for instance, by reducing plastic usage, sourcing locally, and promoting organic and fair-trade products. This movement towards sustainability showcases the changed values and preferences of the current consumers and also emphasizes the need for responsible business practices in the food and grocery retail market.
Consumers are increasingly demanding eco-friendly products and sustainable practices from retailers.
People nowadays are considerably aware of the environment. The growing consciousness of the environmental effect of traditional consumption patterns is the driving force behind the request for eco-friendly products and sustainable practices from the retail sector. The consumer behavior is modified with the help of various mechanisms, among which is the availability of accurate information, knowledge about the changing climate, and the need to improve conditions for present and future generations.
Environmentalists and eco-conscious consumers go out of their way to locate products made from natural resources, having less packaging, and are obtained in ways that are friendly to the Earth. For instance, there is a large increase in demand for products made from recycled or biodegradable materials, in addition to those that have a lower carbon footprint.
This goes beyond the products to the whole supply chain. Consumers do not only want to buy products that are eco-friendly, but they also want to be sure that the brands are sustainable sourcing, ethical labor practices, and responsible manufacturing.
One of the ways through which retailers can satisfy customer desires is by adopting several sustainable ways of operating. A lot of them are not using single-use plastics, recycling programs, and sourcing locally to lessen transportation emissions. In addition, some retailers are funding the purchase of renewable energy for their operations and improving the energy efficiency of their stores. With these actions, they not only fulfill consumer wants but also take part in such a larger look as environmental sustainability.
Self-checkout and autonomous payment systems are becoming more common in stores.
Self-service and autonomous payment systems have turned into a norm in retail outlets, radically altering the shopping conditions for consumers and retailers. The above-mentioned systems enable clients to independently scan, bag, and pay for their products without any help from a cashier. The transition to self-service technology has been forced by multiple reasons, including the pursuit of convenience, efficiency, and cost savings.
For the customers, self-checkout is the faster and more convenient way of purchasing their goods. Browsers do not have to stand shuffler long to get groceries thus they have a power of controlling the checkout process. Furthermore, self-checkout systems are user-friendly and intuitive, this is why they doubtless find it easy to go through the payment process. Now that mobile payment options have been included, such as digital wallets and contactless payments, the checkout experience has become even more seamless and efficient.
Apart from that, retailers also enjoy the advantages of using the self-checkout and autonomous payment systems. First, these systems are a good way of cutting down on labor costs since they only employ a small number of cashiers. This gives retailers a chance to redistribute their staff to other relevant tasks like refacing or providing assistance to the consumers in the store. In addition, self-checkout systems can positively impact the visit of a customer to the store by speeding up the process and getting rid of the delays that happen when the store is busy. Consequently, the buyers will be happier and possibly, come back.
Automation, robotics, and smart technology are revolutionizing supply chains and store operations.
The opening of a completely new highly efficient, error-free, and cost-effective age for management of supply chains and retail operations through the use of automation, robotics, and smart technology is possible through the latter's capability to efficiently restructure and assign tasks at supply chains and retail establishments. These technologies are deployed in various retail sectors, starting from the inventory management system to the customer service sector, which in turn increases the efficiency and trustworthiness of both supply chains and in-store operations.
Incorporation of automation in supply chains comes with many advantages among which the direct one is the efficiency of streamlining kinetic and optimize operation. Automated systems are able to carry out repetitious jobs like sorting, packing, and labeling with a higher accuracy rate and a quicker speed, which frees up manual labor and also helps in minimizing errors.
With faster throughputs of tasks, it becomes possible for employees to do more productive and value-add interventions. The different yield from this is seen in the case of automated warehouses for instance, they utilize robotics and conveyor systems to move and arrange goods effectively, in this way they are sure that the delivery is on time and also they virtually eliminate stock-out issues.
Robotic applications have become an essential part of sustaining the accuracy and efficiency of supply chain operations. Companies that utilize automated guided vehicles (AGVs) and autonomous mobile robots (AMRs) for transporting goods among different warehouses and distribution centers have consequently reduced the effort and time required for manual handling processes.
The robots are fitted with highly sophisticated sensors and artificial intelligence to operate in complex environmentsevade obstacles and optimize their own routes. Moreover, robotic arms are used for operations that involve picking and packing items which in turn makes it possible to maintain a consistent quality of product and packing.
During the period 2020 to 2024, the sales grew at a CAGR of 3.1% and it is predicted to continue to grow at a CAGR of 3.3% during the forecast period of 2025 to 2035.
The food and grocery retail sector has undergone massive changes throughout the years. These are the factor that reflects the changes in consumer behavior, technological progressions, and economic circumstances. In the early years of the 20th century, the market was mostly made up of small mom-and-pop stores that were selling grocery items to the local communities.
The 1950s and 1960s were the time when supermarkets started to take over. They were the ones who changed the whole course of the industry by allowing people to purchase many different things in one place. This was a big step toward making shopping easier for people.
The 1980s and beyond marked a period where the market was introduced to the entry of some international retail brands like Walmart, Tesco, and Carrefour, which were the ones that went global, expanded their reach, and implemented modern supply chain management. These were retailers that worked on a large scale and they got the market to make bulk purchasing, competitive pricing, and private label brands a thing of the past by effective practices.
The advent of e-businesses in the early turn of the century was the thing that turned the market around due to the possibility for people to buy foodstuffs online and have them delivered to their homes. The period was also characterized by the rising awareness of health and the incorporation of organic and natural foods into the daily diets of people causing the demand for such food to rise.
Tier 1: 1 consists of the dominating global market companies such as Walmart, Costco Wholesale Corp., and Amazon.com Inc., which are practically equal to industrial giants. Walmart is a mothership of the retail industry boasting more than 10,500 stores around the globe and maximizing its potential with a remarkably wide product array and seamless supply chain operations.
Costco is a true membership model trendsetter that builds loyalty among its clients through the bulk purchasing option while maintaining the competitiveness of prices and Amazon is the one who has always provided proper solutions by utilizing state-of-the-art logistics and a data-driven approach to meet the needs of a wide range of customers. Holding substantial proportions of market share, these companies are the main reason for the high market concentration tier.
Tier 2: Hidden in the deep darkness of the night are regional and national players like The Kroger Co., Target Brands, Inc., and ALDI. they have strongholds in specific regions. Kroger is a focus on private-label goods and the company is based similar to a loyalty program for the consumers, Target acted like a magnet for people with diverse lifestyles and preferences, by the means of having products that one would like as well as good location of stores, ALDI is again an operator, who demonstrates the products through the suppliers and low prices come through efficient operations and a limited assortment strategy. Although these companies may not be worldwide successful as the Tier 1 ones, they do attain to standing market share in their regions, contributing to moderate market concentration.
Tier 3: Tier 3 represents firms mostly consisting of local retailers that often operate as sole proprietors and offer services to specific cities or towns. These include companies such as small grocery chains, family-owned stores, and specialty food retailers that love to provide personal care, the products which are not available in other places, and the sense of belonging to the community. Even if they do not have the influence, nor the scale of Tier 1 and Tier 2 companies, they provide a variety of items that customers can buy while helping to create loyalty to their stores in the long run and this is the retail ecosystem they build. The market is concentrated in this tier, which is relatively low, because of numerous small players, as a result, the market is fragmented.
The following table shows the estimated growth rates of the significant three geographies sales. USA and Germany are set to exhibit high consumption, recording CAGRs of 2.7% and 2.2% respectively, through 2035.
| Countries | CAGR 2025 to 2035 |
|---|---|
| USA | 2.7% |
| Germany | 2.2% |
| India | 4.2% |
A notable movement toward health and wellness is evident among customers in the USA, and this is the primary reason for the increase in the demand for organic and natural items. With a greater sense of awareness, people have come to know the health hazards related to the use of processed and artificial ingredients and now they have the need to look for the food that is free from synthetic chemicals, pesticides, and GMOs.
Information on nutrition and wellness is readily available, and there is also a high-profile campaign of organic lifestyles by celebrities and influencers which strongly encourage this trend. Consequently, retailers react by expanding their portfolios of organic and natural products, and even regular supermarkets devote more space for these goods. The outcome is the accumulation of a market for organic fruits, dairy, meats, and packaged foods that are rapidly growing and depicting a broader view of the society placed on health and sustainability.
Germany experiences the popularization of sustainability and local sourcing products, which is propelled by the strong will of the population to conserve the environment and the desire to support local economies. Customers are increasingly shifting towards products that have a less environmental footprint, like less packaging, lower carbon footprints, and more sustainable production practices.
Especially, local sourcing is given importance as it not only helps with the reduction of transportation emissions but also helps with the support of local farmers and producers. This movement is powered by the acceleration of climate change knowledge and a cultural norm of ecological responsibility. Thus, retailers are adapting to this change by launching a bigger range of organic, fair-trade, and local products making it easier for the customers to choose products that are good for the environment aware of the society.
The need for ready and packed foods vitiated in Indian markets in recent times as a result of a lot of reasons such as the change in lifestyle and the rise in the economy. Urbanization has brought a swift change in the cities and people have become busier than ever before which has given them little time to cook traditional meals. The rise in dual-income families and small family units has made the demand for easy-to-cook and ready-to-cook meals stronger.
As well, the relevant increase in the earning of the consumers and middle-class family’s expansion the provision of carrying out different kinds of packaged foods was perceived by more consumers. The advent of supermarkets, hypermarkets, and online shopping platforms has made available these products easily and is more attractive. Thus, today the Indian market for packed and processed foods is thriving with the ability to meet the changing preferences and desires of a complex and lively populace.
| Segment | Value Share (2025) |
|---|---|
| Fresh Food (Product Type) | 38% |
The remuneration of the global fresh food commodities is on the rise as people develop a health-friendly and environmental-friendly attitude. People are starting to look for fruits, vegetables, and other unprocessed foods, accepting the advantages they provide via nutrition, flavor, and personal health. The farm-to-table concept is getting stronger, and people tend to buy organic and local products more often.
The search is also affected by the issues of food safety and the immanence of health defects by consuming processed food. On top of that, the pandemic has made it far more apparent that eating the necessary nutrients like carbohydrates and proteins from fresh vegetables is very important that it has made people ask for such foods even more. Consequently, supermarkets, farmers' markets, and urban farming are all doing well hence they have adopted the trend of selling unrefined and wholesome food things.
| Segment | Value Share (2025) |
|---|---|
| Supermarket (Sales Channel) | 63% |
The global market has been almost totally conquered by supermarkets mainly as a result of the fact that they can provide consumers a vast number of products from one place. These mega outlets supply customers a lot of convenience since they can buy food, home appliances, clothes and even electronic devices all in one go.
The growth of supermarket chains has been largely based on the fact that they could take advantage of the benefits of economies of scale, thus, they manage to sell at lower prices and attract a bigger customer mix. Supermarkets usually launch private-label brands in addition, which are cheaper than the branded ones.
The advent of technology like the installation of the self-service checkout systems and the operation of online shopping platforms have significantly improved the shopping experience making it more efficient and user-friendly. Consequently, supermarkets remain the uncontested retail sector kings and, by all means, have adjusted to the demanding wants and wishes of consumers from virtually all corners of the earth.
The food and grocery retail market is experiencing stiff competition with following wales like Walmart, Costco Wholesale Corp., 7-ELEVEN, Inc., and Amazon.com Inc. Walmart has the first position in the rating of the companies as it has a powerful chain of stores and the most favorable prices that make this company the most commonly chosen by customers.
The value of Costco Warehouse Corp. is its membership model and the ability to buy wholesale, which attracts customers who are looking for value and savings. However, the most successful convenience store in this segment is 7-ELEVEN, Inc. that provides customers with fast access to much-needed products and omnipresent food accompaniment to the on-the-go lifestyle.
The advent of Amazon.com Inc. in the market has caused a digital transformation by the means of e-commerce and with the advantage of online shopping and trending quick delivery services. All these retailers introduce new products and services and they have to compete with each other by constantly improving their offerings as well as their customer service in food and grocery retail market, which leads to continuous development of technological solutions and consumer-oriented approach.
By Product type the industry has been categorised into Fresh Food, Frozen Food, Food Cupboard, Beverages, Cleaning & Household, Others
By Distribution Channel the industry has been categorised into Supermarkets & Hypermarkets, Convenience Stores, Departmental Stores, Online
Industry analysis has been carried out in key countries of North America, Latin America, Europe, East Asia, South Asia and Middle East & Africa
The market is expected to grow at a CAGR of 3.3% throughout the forecast period.
By 2035, the sales value is expected to be worth USD 17.7 Trillion.
North America region region is expected to dominate the global consumption.
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