![Lidl and Regional road 559 in Siilinjärvi](https://upload.wikimedia.org/wikipedia/commons/3/34/Lidl_and_Regional_road_559_in_Siilinj%C3%A4rvi.jpg)
A supermarket is a
self-service
Self-service is the practice of serving oneself, usually when making purchases. Aside from Automated Teller Machines, which are not limited to banks, and customer-operated supermarket check-out, labor-saving of which has been described as self- ...
shop
Shop or shopping refers to:
Business and commerce
* A casual word for a commercial establishment or for a place of business
* Machine shop, a workshop for machining
*"In the shop", referring to a car being at an automotive repair shop
*A wood s ...
offering a wide variety of
food
Food is any substance consumed by an organism for nutritional support. Food is usually of plant, animal, or fungal origin, and contains essential nutrients, such as carbohydrates, fats, proteins, vitamins, or minerals. The substance is inge ...
,
beverages
A drink or beverage is a liquid intended for human consumption. In addition to their basic function of satisfying thirst, drinks play important roles in human culture. Common types of drinks include plain drinking water, milk, juice, smoothies a ...
and
household products, organized into sections. This kind of store is larger and has a wider selection than earlier
grocery store
A grocery store ( AE), grocery shop ( BE) or simply grocery is a store that primarily retails a general range of food products, which may be fresh or packaged. In everyday U.S. usage, however, "grocery store" is a synonym for supermarket, a ...
s, but is smaller and more limited in the range of merchandise than a
hypermarket
A hypermarket (sometimes called a hyperstore, supercentre or superstore) is a big-box store combining a supermarket and a department store. The result is an expansive retail facility carrying a wide range of products under one roof, including ...
or
big-box market. In everyday
U.S.
The United States of America (U.S.A. or USA), commonly known as the United States (U.S. or US) or America, is a country Continental United States, primarily located in North America. It consists of 50 U.S. state, states, a Washington, D.C., ...
usage, however, "grocery store" is synonymous with supermarket,
and is not used to refer to other types of stores that sell groceries.
The supermarket typically has places for fresh meat, fresh
produce
Produce is a generalized term for many farm-produced crops, including fruits and vegetables (grains, oats, etc. are also sometimes considered ''produce''). More specifically, the term ''produce'' often implies that the products are fresh and g ...
,
dairy
A dairy is a business enterprise established for the harvesting or processing (or both) of animal milk – mostly from cows or buffaloes, but also from goats, sheep, horses, or camels – for human consumption. A dairy is typically located on ...
,
deli
Deli may refer to:
* Delicatessen, a shop selling specially prepared food, or food prepared by such a shop
* Sultanate of Deli, a former sultanate in North Sumatra, Indonesia
Places
* Deli, Boyer-Ahmad, a village in Kohgiluyeh and Boyer-Ahmad Pro ...
items, baked goods, etc.
Shelf space is also reserved for canned and packaged goods and for various non-food items such as
kitchenware :'' For a record label, see Kitchenware Records''
Kitchenware are the tools, utensils, appliances, dishes, and cookware used in food preparation, or the serving of food. Kitchenware can also be used in order to hold or store food before or aft ...
,
household cleaner
A detergent is a surfactant or a mixture of surfactants with cleansing properties when in dilute solutions. There are a large variety of detergents, a common family being the alkylbenzene sulfonates, which are soap-like compounds that are more ...
s,
pharmacy
Pharmacy is the science and practice of discovering, producing, preparing, dispensing, reviewing and monitoring medications, aiming to ensure the safe, effective, and affordable use of medicines. It is a miscellaneous science as it links heal ...
products and pet supplies. Some supermarkets also sell other household products that are consumed regularly, such as alcohol (where permitted), medicine, and
clothing
Clothing (also known as clothes, apparel, and attire) are items worn on the body. Typically, clothing is made of fabrics or textiles, but over time it has included garments made from animal skin and other thin sheets of materials and natural ...
, and some sell a much wider range of non-food products:
DVD
The DVD (common abbreviation for Digital Video Disc or Digital Versatile Disc) is a digital optical disc data storage format. It was invented and developed in 1995 and first released on November 1, 1996, in Japan. The medium can store any kin ...
s, sporting equipment, board games, and seasonal items (e.g.,
Christmas
Christmas is an annual festival commemorating Nativity of Jesus, the birth of Jesus, Jesus Christ, observed primarily on December 25 as a religious and cultural celebration among billions of people Observance of Christmas by country, around t ...
wrapping paper
Gift wrapping is the act of enclosing a gift in some sort of material. Wrapping paper is a kind of paper designed for gift wrapping. An alternative to gift wrapping is using a gift box or bag. A wrapped or boxed gift may be held closed with ribb ...
in December).
A larger full-service supermarket combined with a
department store
A department store is a retail establishment offering a wide range of consumer goods in different areas of the store, each area ("department") specializing in a product category. In modern major cities, the department store made a dramatic app ...
is sometimes known as a
hypermarket
A hypermarket (sometimes called a hyperstore, supercentre or superstore) is a big-box store combining a supermarket and a department store. The result is an expansive retail facility carrying a wide range of products under one roof, including ...
. Other services may include those of banks, cafés, childcare centers/creches, insurance (and other financial services),
mobile phone
A mobile phone, cellular phone, cell phone, cellphone, handphone, hand phone or pocket phone, sometimes shortened to simply mobile, cell, or just phone, is a portable telephone that can make and receive calls over a radio frequency link whil ...
services, photo processing, video rentals, pharmacies, and
gas stations
A filling station, also known as a gas station () or petrol station (), is a facility that sells fuel and engine lubricants for motor vehicles. The most common fuels sold in the 2010s were gasoline (or petrol) and diesel fuel.
Gasoline ...
. If the eatery in a supermarket is substantial enough, the facility may be called a "grocerant", a blend of "grocery" and "restaurant".
The traditional supermarket occupies a large amount of floor space, usually on a single level. It is usually situated near a residential area in order to be convenient to consumers. The basic appeal is the availability of a broad selection of goods under a single roof, at relatively low prices. Other advantages include ease of parking and frequently the convenience of shopping hours that extend into the evening or even 24 hours of the day. Supermarkets usually allocate large budgets to advertising, typically through newspapers. They also present elaborate in-shop displays of products.
Supermarkets typically are
chain store
A chain store or retail chain is a retail outlet in which several locations share a brand, central management and standardized business practices. They have come to dominate the retail and dining markets and many service categories, in many pa ...
s, supplied by the
distribution center
A distribution center for a set of products is a warehouse or other specialized building, often with refrigeration or air conditioning, which is stocked with products (goods) to be redistributed to retailers, to wholesalers, or directly to con ...
s of their
parent companies
A holding company is a company whose primary business is holding a controlling interest in the securities of other companies. A holding company usually does not produce goods or services itself. Its purpose is to own shares of other companies ...
, thus increasing opportunities for
economies of scale
In microeconomics, economies of scale are the cost advantages that enterprises obtain due to their scale of operation, and are typically measured by the amount of output produced per unit of time. A decrease in cost per unit of output enables ...
. Supermarkets usually offer products at relatively low prices by using their buying power to buy goods from manufacturers at lower prices than smaller stores can. They also minimise financing costs by paying for goods at least 30 days after receipt and some extract credit terms of 90 days or more from vendors. Certain products (typically staple foods such as bread, milk and sugar) are very occasionally sold as
loss leader
A loss leader (also leader) is a pricing strategy where a product is sold at a price below its market cost to stimulate other sales of more profitable goods or services. With this sales promotion/marketing strategy, a "leader" is any popular articl ...
s so as to attract shoppers to their store. Supermarkets make up for their low
margins
Margin may refer to:
Physical or graphical edges
*Margin (typography), the white space that surrounds the content of a page
*Continental margin, the zone of the ocean floor that separates the thin oceanic crust from thick continental crust
*Leaf ...
by a high volume of sales, and with of higher-margin items bought by the attracted shoppers. Self-service with shopping carts (trolleys) or
baskets
A basket is a container that is traditionally constructed from stiff fibers and can be made from a range of materials, including wood splints, runners, and cane. While most baskets are made from plant materials, other materials such as horsehai ...
reduces labor costs, and many supermarket chains are attempting further reduction by shifting to
self-service check-out.
History
![Klaukkala S-Market 05](https://upload.wikimedia.org/wikipedia/commons/8/80/Klaukkala_S-Market_05.jpg)
In the early days of retailing, generally an assistant fetched products from shelves behind the merchant's counter while customers waited in front of the counter, indicating the items they wanted. Most foods and merchandise did not come in individually wrapped consumer-sized packages, so an assistant measured out and wrapped the precise amount requested by the consumer. This offered opportunities for social interaction: many regarded this style of shopping as "a social occasion" and would often "pause for conversations with the staff or other customers". These practices were by nature slow and had high
labor intensity
Labor intensity is the relative proportion of Labour (economics), labor (compared to Capital (economics), capital) used in any given process. Its inverse is capital intensity.
Labor intensity has been declining since the onset of the Industrial Re ...
and therefore also quite expensive. The number of customers who could be attended to at one time was limited by the number of staff employed in the store. Shopping for groceries also often involved trips to multiple specialty shops, such as a
greengrocer
A greengrocer is a person who owns or operates a shop selling primarily fruit and vegetables. The term may also be used to refer to a shop selling primarily produce. It is used predominantly in the United Kingdom and Australia.
In the United ...
,
butcher
A butcher is a person who may Animal slaughter, slaughter animals, dress their flesh, sell their meat, or participate within any combination of these three tasks. They may prepare standard cuts of meat and poultry for sale in retail or wholesal ...
,
bakery
A bakery is an establishment that produces and sells flour-based food baked in an oven such as bread, cookies, cakes, donuts, pastries, and pies. Some retail bakeries are also categorized as cafés, serving coffee and tea to customers who ...
,
fishmonger
A fishmonger (historically fishwife for female practitioners) is someone who sells raw fish and seafood. Fishmongers can be wholesalers or retailers and are trained at selecting and purchasing, handling, gutting, boning, filleting, displaying, me ...
and
dry goods
Dry goods is a historic term describing the type of product line a store carries, which differs by region. The term comes from the textile trade, and the shops appear to have spread with the mercantile trade across the British Empire (and forme ...
store, in addition to a
general store. Milk and other items of short
shelf life
Shelf life is the length of time that a commodity may be stored without becoming unfit for use, consumption, or sale. In other words, it might refer to whether a commodity should no longer be on a pantry shelf (unfit for use), or no longer on a ...
were delivered by a
milkman
Milk delivery is a delivery service dedicated to supplying milk. This service typically delivers milk in bottles or cartons directly to customers' homes. This service is performed by a milkman, milkwoman, or milk deliverer. (In contrast, a cow ...
.
The concept of an inexpensive food market relying on economies of scale was developed by
Vincent Astor
William Vincent Astor (November 15, 1891 – February 3, 1959) was an American businessman, philanthropist, and member of the prominent Astor family.
Early life
Called Vincent, he was born in New York City on November 15, 1891. Astor was the eld ...
. He founded the
Astor Market
The Astor Market was an indoor public market built in 1915 at 95th Street and Broadway on the Upper West Side of Manhattan, New York City. It was financed by Vincent Astor with between $750,000 and $1,000,000.
History
It was designed by Tra ...
in 1915, investing $750,000 of his fortune into a 165′ by 125′ (50×38-metre) corner of 95th and Broadway,
Manhattan
Manhattan (), known regionally as the City, is the most densely populated and geographically smallest of the five boroughs of New York City. The borough is also coextensive with New York County, one of the original counties of the U.S. state ...
, creating, in effect, an open-air mini-mall that sold meat, fruit, produce and flowers. The expectation was that customers would come from great distances ("miles around"), but in the end, even attracting people from ten blocks away was difficult, and the market folded in 1917.
The concept of a self-service grocery store was developed by entrepreneur
Clarence Saunders Clarence Saunders may refer to:
* Clarence Saunders (grocer) (1881–1953), American grocer, pioneer of supermarkets
* Clarence Saunders (athlete) (born 1963), Bermudian high jumper
{{hndis, Saunders, Clarence ...
and his
Piggly Wiggly
Piggly Wiggly is an American supermarket chain operating in the American Southern and Midwestern regions run by Piggly Wiggly, LLC, an affiliate of C&S Wholesale Grocers. Its first outlet opened in 1916 in Memphis, Tennessee, and is notable f ...
stores, the first of which opened in 1916. Saunders was awarded several patents for the ideas he incorporated into his stores. The stores were a financial success and Saunders began to offer franchises.
The Great Atlantic & Pacific Tea Company
The Great Atlantic & Pacific Tea Company, better known as A&P, was an American chain store, chain of grocery stores that operated from 1859 to 2015. From 1915 through 1975, A&P was the largest grocery retailer in the United States (and, until ...
, which was established in 1859, was another successful early grocery store chain in Canada and the United States, and became common in North American cities in the 1920s. Early self-service grocery stores did not sell fresh meats or produce. Combination stores that sold perishable items were developed in the 1920s.
The general trend since then has been to stock shelves at night so that customers, the following day, can obtain their own goods and bring them to the front of the store to pay for them. Although there is a higher risk of
shoplifting
Shoplifting is the theft of goods from an open retail establishment, typically by concealing a store item on one's person, in pockets, under clothes or in a bag, and leaving the store without paying. With clothing, shoplifters may put on items ...
, the costs of appropriate security measures ideally will be outweighed by reduced labor costs.
Historically, there has been debate about the origin of the supermarket, with
King Kullen
King Kullen Grocery Co., Inc., is an American supermarket chain based on Long Island. The company is headquartered in Hauppauge, New York, and was founded by Michael J. Cullen on August 4, 1930.
The chain operates 27 locations. It is notable for i ...
and
Ralphs
Ralphs is an American supermarket chain in Southern California. The largest subsidiary of Cincinnati-based Kroger, it is the oldest such chain west of the Mississippi River. Kroger also operates stores under the Food 4 Less and Foods Co. names ...
of California having strong claims. Other contenders included
Weingarten's
Weingarten's was a supermarket chain in the Southern United States until it was acquired by Safeway in 1983. J. Weingarten, Inc. had its headquarters in what is now the East End in Houston, Texas.
History
Hersch Harris Weingarten, a poor Jewish i ...
and
Henke & Pillot
Henke & Pillot was a chain of supermarkets headquartered in Houston, Texas.Gonzales, J.R.Houston's own Henke & Pillot" ''Houston Chronicle'' blogs. October 20, 2010. Retrieved January 13, 2011. "Offices at 3021 Washington" The chain began in 1872. ...
. To end the debate, the
Food Marketing Institute
Food is any substance consumed by an organism for nutritional support. Food is usually of plant, animal, or fungal origin, and contains essential nutrients, such as carbohydrates, fats, proteins, vitamins, or minerals. The substance is inge ...
in conjunction with the
Smithsonian Institution
The Smithsonian Institution ( ), or simply the Smithsonian, is a group of museums and education and research centers, the largest such complex in the world, created by the U.S. government "for the increase and diffusion of knowledge". Founded ...
and with funding from
H.J. Heinz
Henry John Heinz (October 11, 1844 – May 14, 1919) was an American entrepreneur of Palatine descent who, at the age of 25, co-founded a small horseradish concern in Sharpsburg, Pennsylvania. This business failed, but his second business ex ...
, researched the issue. They defined the attributes of a supermarket as "self-service, separate product departments, discount pricing, marketing and volume selling".
They determined that the first true supermarket in the United States was opened by a former
Kroger
The Kroger Company, or simply Kroger, is an American retail company that operates (either directly or through its subsidiaries) supermarkets and multi-department stores throughout the United States.
Founded by Bernard Kroger in 1883 in Cincin ...
employee,
Michael J. Cullen
Michael J. Cullen (1884–1936) was an American entrepreneur and salesman known as the founder of the King Kullen grocery store chain, widely considered to be the first supermarket founded in America. He is recognized by the Smithsonian Instituti ...
, on 4 August 1930, inside a former garage in
Jamaica, Queens
Jamaica is a neighborhood in the New York City borough of Queens. It is mainly composed of a large commercial and retail area, though part of the neighborhood is also residential. Jamaica is bordered by Hollis to the east; St. Albans, Springfi ...
in New York City. The store, King Kullen, operated under the slogan "Pile it high. Sell it low." At the time of Cullen's death in 1936, there were seventeen King Kullen stores in operation. Although Saunders had brought the world self-service, uniform stores, and nationwide marketing, Cullen built on this idea by adding separate food departments, selling large volumes of food at discount prices and adding a parking lot.
Other established American grocery chains in the 1930s, such as Kroger and
Safeway Inc.
Safeway is an American supermarket chain founded by Marion Barton Skaggs in April 1915 in American Falls, Idaho. The chain provides grocery items, food and general merchandise and features a variety of specialty departments, such as bakery, del ...
at first resisted Cullen's idea, but eventually were forced to build their own supermarkets as the economy sank into the
Great Depression
The Great Depression (19291939) was an economic shock that impacted most countries across the world. It was a period of economic depression that became evident after a major fall in stock prices in the United States. The economic contagio ...
, while consumers were becoming price-sensitive at a level never experienced before. Kroger took the idea one step further and pioneered the first supermarket surrounded on all four sides by a
parking lot
A parking lot (American English) or car park (British English), also known as a car lot, is a cleared area intended for parking vehicles. The term usually refers to an area dedicated only for parking, with a durable or semi-durable surface ...
.
As larger chain supermarkets began to dominate the market in the US, able to supply consumers with the desired lower prices as opposed to the smaller "mom and pop" stands with considerably more overhead costs, the backlash of this infrastructure alteration was seen through numerous anti-chain campaigns. The idea of "monopsony", proposed by Cambridge economist Joan Robinson in 1933, that a single buyer could out-power the market of multiple sellers, became a strong anti-chain rhetorical device. With public backlash came political pressure to even the playing field for smaller vendors lacking the luxury of economies of scale. In 1936, the
Robinson-Patman Act was implemented as a way of preventing such larger chains from using this buying power to reap advantages over smaller stores, although the act was not well enforced and did not have much impact on the prevention of larger chains overtaking power in the markets.
Supermarkets proliferated across Canada and the United States with the growth of automobile ownership and
suburban development after World War II. Most North American supermarkets are located in suburban
strip shopping centers as an anchor store along with other smaller retailers. They are generally regional rather than national in their company branding. Kroger is perhaps the most nationally oriented supermarket chain in the United States but it has preserved most of its regional brands, including
Ralphs
Ralphs is an American supermarket chain in Southern California. The largest subsidiary of Cincinnati-based Kroger, it is the oldest such chain west of the Mississippi River. Kroger also operates stores under the Food 4 Less and Foods Co. names ...
,
City Market,
King Soopers
King Soopers is a supermarket brand of Kroger located in the Rocky Mountains of the United States. It started as its own brand and, today, is headquartered in Denver, Colorado.
King Soopers has a significant presence in the state of Colorado on ...
,
Fry's,
Smith's, and
QFC
Quality Food Centers, better known as QFC, is a supermarket chain based in Bellevue, Washington, with 62 stores in the Puget Sound region of the state of Washington and in the Portland, Oregon, metropolitan area. QFC is a subsidiary of Kroger.
...
.
In Canada, the largest such company is
Loblaw
Loblaw Companies Limited is a Canadian retailer encompassing corporate and franchise supermarkets operating under 22 regional and market-segment banners (including Loblaws), as well as pharmacies, banking and apparel. Loblaw operates a private ...
, which operates stores under a variety of banners targeted to different segments and regions, including
Fortinos
Fortinos is a Canadian supermarket chain that was founded in Hamilton, Ontario. It operates 23 stores across the western Greater Toronto and Hamilton Area. It is owned by Loblaw Companies Limited.
History
In 1961, Italian immigrant steelwork ...
,
Zehrs
Zehrmart Inc. (doing business as Zehrs Markets or simply Zehrs ), is a Canadian supermarket chain in southern Ontario. The chain has 43 locations and is a part of Loblaw Companies Limited which purchased the Zehrs chain in the mid-1970s.
Hist ...
,
No Frills, the Real Canadian Superstore, and Loblaws, the foundation of the company.
Sobeys
Sobeys Inc. is the second largest supermarket chain in Canada, with over 1,500 stores operating across Canada under a variety of banners. Headquartered in Stellarton, Nova Scotia, it operates stores in all ten provinces and accumulated sales o ...
is Canada's second largest supermarket with locations across the country, operating under many banners (Sobeys IGA in
Quebec
Quebec ( ; )According to the Canadian government, ''Québec'' (with the acute accent) is the official name in Canadian French and ''Quebec'' (without the accent) is the province's official name in Canadian English is one of the thirtee ...
). Québec's first supermarket opened in 1934 in Montréal, under the banner
Steinberg's.
In the United Kingdom, self-service shopping took longer to become established. Even in 1947, there were just ten self-service shops in the country.
In 1951, ex-US Navy sailor Patrick Galvani, son-in-law of
Express Dairies
Express Dairies is a former brand of Dairy Crest, that specialised almost entirely in home deliveries of milk, and other dairy products.
History
The company was founded by George Barham in 1864 as the 'Express County Milk Supply Company,' so name ...
chairman, made a pitch to the board to open a chain of supermarkets across the country. The UK's first supermarket under the new
Premier Supermarkets
Express Dairies is a former brand of Dairy Crest, that specialised almost entirely in home deliveries of milk, and other dairy products.
History
The company was founded by George Barham in 1864 as the 'Express County Milk Supply Company,' so name ...
brand opened in
Streatham
Streatham ( ) is a district in south London, England. Centred south of Charing Cross, it lies mostly within the London Borough of Lambeth, with some parts extending into the neighbouring London Borough of Wandsworth.
Streatham was in Surrey ...
,
South London
South London is the southern part of London, England, south of the River Thames. The region consists of the Districts of England, boroughs, in whole or in part, of London Borough of Bexley, Bexley, London Borough of Bromley, Bromley, London Borou ...
,
taking ten times as much per week as the average British general store of the time. Other chains caught on, and after Galvani lost out to Tesco's
Jack Cohen in 1960 to buy the 212 Irwin's chain, the sector underwent a large amount of consolidation, resulting in 'the big four' dominant UK of today:
Tesco
Tesco plc () is a British multinational groceries and general merchandise retailer headquartered in Welwyn Garden City, England. In 2011 it was the third-largest retailer in the world measured by gross revenues and the ninth-largest in th ...
,
Asda
Asda Stores Ltd. () (often styled as ASDA) is a British supermarket chain. It is headquartered in Leeds, England. The company was founded in 1949 when the Asquith family merged their retail business with the Associated Dairies company of York ...
,
Sainsbury's
J Sainsbury plc, trading as Sainsbury's, is the second largest chain of supermarkets in the United Kingdom, with a 14.6% share of UK supermarket sales.
Founded in 1869 by John James Sainsbury with a shop in Drury Lane, London, the company wa ...
and
Morrisons
Wm Morrison Supermarkets, trading as Morrisons, is the fifth largest supermarket chain in the United Kingdom. As of 2021, the company had 497 supermarkets across England, Wales and Scotland, as well as one in Gibraltar. The company is headqua ...
.
In the 1950s, supermarkets frequently issued
trading stamp
Trading stamps are small paper stamps given to customers by merchants in loyalty programs that predate the modern loyalty card. Like the similarly-issued retailer coupons, these stamps only had a minimal cash value of a few mils (thousandths of a ...
s as incentives to customers. Today, most chains issue store-specific "membership cards", "club cards", or "
loyalty card
A loyalty program is a marketing strategy designed to encourage customers to continue to shop at or use the services of a business associated with the program. Today, such programs cover most types of commerce, each having varying features and ...
s". These typically enable the cardholder to receive special members-only discounts on certain items when the credit card-like device is scanned at check-out. Sales of selected data generated by club cards is becoming a significant revenue stream for some supermarkets.
Traditional supermarkets in many countries face intense competition from
discounter
A discount store or discounter offers a retail format in which products are sold at prices that are in principle lower than an actual or supposed "full retail price". Discounters rely on bulk purchasing and efficient distribution to keep down cost ...
s such as Wal-Mart,
Aldi
Aldi (stylised as ALDI) is the common company brand name of two German multinational family-owned discount supermarket chains operating over 10,000 stores in 20 countries. The chain was founded by brothers Karl and Theo Albrecht in 1946, when t ...
and
Lidl
Lidl Stiftung & Co. KG (; ) is a German international discount retailer chain that operates over 11,000 stores across Europe and the United States. Headquartered in Neckarsulm, Baden-Württemberg, the company belongs to the Schwarz Group, whi ...
, which typically is non-
union
Union commonly refers to:
* Trade union, an organization of workers
* Union (set theory), in mathematics, a fundamental operation on sets
Union may also refer to:
Arts and entertainment
Music
* Union (band), an American rock group
** ''Un ...
and operates with better buying power. Other competition exists from
warehouse clubs
A warehouse club (or wholesale club) is a retail store, usually selling a wide variety of merchandise, in which customers may buy large, wholesale quantities of the store's products, which makes these clubs attractive to both bargain hunters ...
such as
Costco
Costco Wholesale Corporation (doing business as Costco Wholesale and also known simply as Costco) is an American multinational corporation which operates a chain of membership-only big-box retail stores (warehouse club). As of 2022, Costco i ...
that offer savings to customers buying in bulk quantities.
Superstores
A big-box store (also hyperstore, supercenter, superstore, or megastore) is a physically large retail establishment, usually part of a chain of stores. The term sometimes also refers, by extension, to the company that operates the store. The te ...
, such as those operated by Wal-Mart and Asda, often offer a wide range of goods and services in addition to foods. In Australia, Aldi,
Woolworths
Woolworth, Woolworth's, or Woolworths may refer to:
Businesses
* F. W. Woolworth Company, the original US-based chain of "five and dime" (5¢ and 10¢) stores
* Woolworths Group (United Kingdom), former operator of the Woolworths chain of shops ...
and
Coles are the major players running the industry with fierce competition among all the three. The rising market share of Aldi has forced the other two to cut prices and increase their private label product ranges. The proliferation of such warehouse and superstores has contributed to the continuing disappearance of smaller, local grocery stores;
increased dependence on the automobile; sub
urban sprawl
Urban sprawl (also known as suburban sprawl or urban encroachment) is defined as "the spreading of urban developments (such as houses and shopping centers) on undeveloped land near a city." Urban sprawl has been described as the unrestricted growt ...
because of the necessity for large floor space and increased vehicular traffic. For example, in 2009 51% of Wal-Mart's $251 billion domestic sales were recorded from grocery goods. Some critics consider the chains' common practice of selling loss leaders to be anti-competitive. They are also wary of the negotiating power that large, often
multinationals have with suppliers around the world.
Online-only supermarkets (21st century)
During the
dot-com boom
The dot-com bubble (dot-com boom, tech bubble, or the Internet bubble) was a stock market bubble in the late 1990s, a period of massive growth in the use and adoption of the Internet.
Between 1995 and its peak in March 2000, the Nasdaq Compos ...
,
Webvan
Webvan was a dot-com company and grocery business that filed for bankruptcy in 2001 after 3 years of operation. It was headquartered in Foster City, California, United States. It delivered products to customers' homes within a 30-minute window o ...
, an online-only supermarket, was formed and went bankrupt after three years and was acquired by Amazon. The British online supermarket
Ocado
Ocado Group is a British business based in Hatfield, England, which licenses grocery technology. It owns a 50% share of Ocado.com (the other 50% is owned by UK retailer Marks & Spencer) and licenses its grocery fulfilment technology to global ...
, which uses a high degree of automation in its warehouses, was the first successful online-only supermarket. Ocado expanded into providing services to other supermarket firms such as
Waitrose
Waitrose & Partners (formally Waitrose Limited) is a brand of British supermarkets, founded in 1904 as Waite, Rose & Taylor, later shortened to Waitrose. It was acquired in 1937 by employee-owned retailer John Lewis Partnership, which still se ...
and
Morrisons
Wm Morrison Supermarkets, trading as Morrisons, is the fifth largest supermarket chain in the United Kingdom. As of 2021, the company had 497 supermarkets across England, Wales and Scotland, as well as one in Gibraltar. The company is headqua ...
.
Grocery stores such as Walmart employ food delivery services offered by third parties such as
DoorDash
DoorDash, Inc. is an American company that operates an online food ordering and food delivery platform. The company is based in San Francisco, California. It went public in December 2020 on NYSE and trades under the symbol DASH.
With a 56% mar ...
. Other online food delivery services, such as
Deliveroo
Deliveroo is a British online food delivery company founded by Will Shu and Greg Orlowski in 2013 in London, England. It operates in the United Kingdom, France, Belgium, Ireland, Italy, Singapore, Hong Kong, the United Arab Emirates and Kuwait. ...
in the United Kingdom, have begun to pay specific attention to supermarket delivery.
Delivery robots are offered by various companies partnering with supermarkets.
Micro-fulfillment centers (MFC) are relatively small warehouses with sophisticated automated rack-and-tote systems which prepare orders for pickup and delivery. Once the order is complete, the customer will pick it up (i.e. "click-and-collect") or have it fulfilled via home delivery. Supermarkets are investing in micro-fulfillment centers with the hope that automation can help reduce the costs of online commerce and ecommerce by shortening the distances from store to home and speeding up deliveries. In short, MFCs are said by many to be the key to profitably fulfilling online orders.
Types
U.S. categorization
The U.S. FMI food industry association, drawing on research by Willard Bishop, defines the following formats (store types) that sell groceries:
Organic and environmentally-friendly supermarkets
Some supermarkets are focusing on selling more (or even exclusively)
organically certified produce. Others are trying to differentiate themselves by selling fewer (or no) products containing
palm oil
Palm oil is an edible vegetable oil derived from the mesocarp (reddish pulp) of the fruit of the oil palms. The oil is used in food manufacturing, in beauty products, and as biofuel. Palm oil accounted for about 33% of global oils produced from ...
. This as the demand of palm oil is a main driver for the destruction of rainforests.
As a response to the growing concern on the heavy use of petroleum-based plastics for
food packaging
Food packaging is a packaging system specifically designed for food and represents one of the most important aspects among the processes involved in the food industry, as it provides protection from chemical, biological and physical alterations ...
, so-called "
zero waste
Zero waste is a set of principles focused on waste prevention that encourages redesigning resource life cycles so that all products are reused. The goal of this movement is to avoid sending trash to landfills, incinerators, or the ocean. Curren ...
" and "plastic-free" supermarkets and groceries are on the rise.
Growth in developing countries
![La Anonima San Martin de los Andes 3](https://upload.wikimedia.org/wikipedia/commons/4/4c/La_Anonima_San_Martin_de_los_Andes_3.jpg)
Beginning in the 1990s, the food sector in developing countries has rapidly transformed, particularly in Latin America, South-East Asia, India, China and South Africa. With growth, has come considerable competition and some amount of consolidation. The growth has been driven by increasing affluence and the rise of a middle class; the entry of women into the workforce; with a consequent incentive to seek out easy-to-prepare foods; the growth in the use of refrigerators, making it possible to shop weekly instead of daily; and the growth in car ownership, facilitating journeys to distant stores and purchases of large quantities of goods. The opportunities presented by this potential have encouraged several European companies to invest in these markets (mainly in Asia) and American companies to invest in Latin America and China. Local companies also entered the market. Initial development of supermarkets has now been followed by hypermarket growth. In addition there were investments by companies such as
Makro
Makro is a Dutch international brand of warehouse clubs, also called cash and carry stores. Makro was founded by SHV Holdings, a Dutch conglomerate based in Utrecht in partnership with German company Metro AG, with the first warehouse club ...
and
Metro Cash and Carry
Metro AG is a German multinational company based in Düsseldorf which operates business membership only cash and carry stores primarily under the Metro brand. Until 2020 it was also active in general retail business through Real division, wh ...
in large-scale
Cash-and-Carry operations.
While the growth in sales of processed foods in these countries has been much more rapid than the growth in fresh food sales, the imperative nature of supermarkets to achieve economies of scale in purchasing means that the expansion of supermarkets in these countries has important repercussions for small farmers, particularly those growing perishable crops. New supply chains have developed involving
cluster
may refer to:
Science and technology Astronomy
* Cluster (spacecraft), constellation of four European Space Agency spacecraft
* Asteroid cluster, a small asteroid family
* Cluster II (spacecraft), a European Space Agency mission to study t ...
formation; development of specialized wholesalers; leading farmers organizing supply, and farmer associations or cooperatives. In some cases supermarkets have organized their own procurement from small farmers; in others
wholesale markets
The consumption and production of marketed food are spatially separated. Production is primarily in rural areas while consumption is mainly in urban areas. Agricultural marketing is the process that overcomes this separation, allowing produce to b ...
have adapted to meet supermarket needs.
Typical supermarket merchandise
Larger supermarkets in North America and in Europe typically sell many items among many brands, sizes and varieties. U.S. publisher ''Supermarket News'' lists the following categories, for example:
Hypermarkets
A hypermarket (sometimes called a hyperstore, supercentre or superstore) is a big-box store combining a supermarket and a department store. The result is an expansive retail facility carrying a wide range of products under one roof, including ...
have a larger range of non-food categories such as clothing, electronics, household decoration and appliances.
*Bakery (packaged and sometimes a service bakery and/or onsite bakery)
*Beverages (non-alcoholic packaged, sometimes also alcoholic if laws permit)
*Nonfood & Pharmacy (e.g. cigarettes, lottery tickets and over-the-counter medications (as laws permit),
DVD
The DVD (common abbreviation for Digital Video Disc or Digital Versatile Disc) is a digital optical disc data storage format. It was invented and developed in 1995 and first released on November 1, 1996, in Japan. The medium can store any kin ...
rentals
Renting, also known as hiring or letting, is an agreement where a payment is made for the temporary use of a good, service or property owned by another. A gross lease is when the Tenement (law), tenant pays a flat rental amount and the land ...
, books and magazines, including
supermarket tabloid
Tabloid journalism is a popular style of largely sensationalist journalism (usually dramatized and sometimes unverifiable or even blatantly false), which takes its name from the tabloid newspaper format: a small-sized newspaper also known as ...
s, greeting cards, toys, small selection of home goods like light bulbs,
housewares
Household goods are goods and products used within households. They are the tangible and movable personal property placed in the rooms of a house, such as a bed or refrigerator.
Economic role
Businesses that produce household goods are categorize ...
(typically limited)
*Personal care e.g. cosmetics, soap, shampoo
*Produce (fresh fruits and vegetables)
*Floral (flowers and plants)
*Deli (sliced meats, cheeses, etc.)
*Prepared Foods (packaged and frozen foods)
*Meat (fresh packaged, frozen, sometimes with a butcher service counter)
*Seafood (fresh packaged, frozen, sometimes with a butcher service counter)
*Dairy (milk products and eggs)
*Center store (e.g. detergent, paper products, household cleaning supplies)
*Multicultural (ethnic foods)
*Bulk dried foods
*Animal foods, toys and products
Layout strategies
![KrogerattheVillages](https://upload.wikimedia.org/wikipedia/commons/7/7e/KrogerattheVillages.jpg)
Most merchandise is already
packaged
Packaging is the science, art and technology of enclosing or protecting products for distribution, storage, sale, and use. Packaging also refers to the process of designing, evaluating, and producing packages. Packaging can be described as a co ...
when it arrives at the supermarket. Packages are placed on shelves, arranged in aisles and sections according to type of item. Some items, such as fresh produce, are stored in bins. Those requiring an intact
cold chain
A cold chain is a low temperature-controlled supply chain network. An unbroken cold chain is an uninterrupted series of refrigerated production, storage and distribution activities, along with associated equipment and logistics, which maintain qu ...
are in temperature-controlled display cases.
While branding and store advertising will differ from company to company, the layout of a supermarket remains virtually unchanged. Although big companies spend time giving consumers a pleasant shopping experience, the design of a supermarket is directly connected to the in-store marketing that supermarkets must conduct to get shoppers to spend more money while there.
Every aspect of the store is mapped out and attention is paid to color, wording and even surface texture. The overall layout of a supermarket is a visual merchandising project that plays a major role. Stores can creatively use a layout to alter customers' perceptions of the atmosphere. Alternatively, they can enhance the store's atmospherics through visual communications (signs and graphics), lighting, colors, and even scents. For example, to give a sense of the supermarket being healthy, fresh produce is deliberately located at the front of the store. In terms of bakery items, supermarkets usually dedicate 30 to 40 feet of store space to the bread aisle.
Supermarkets are designed to "give each product section a sense of individual difference and this is evident in the design of what is called the anchor departments; fresh produce, dairy, delicatessen, meat and the bakery". Each section has different floor coverings, style, lighting and sometimes even individual services counters to allow shoppers to feel as if there are a number of markets within this one supermarket.
![Minatkulim](https://upload.wikimedia.org/wikipedia/commons/2/23/Minatkulim.jpg)
Marketers use well-researched techniques to try to control purchasing behavior. The layout of a supermarket is considered by some to consist of a few rules of thumb and three layout principles.
[
Aghazedah, S 2005, "Layout strategies for some of the operations", Management Research News, vol. 28, no. 10, pp. 31–46. Retrieved 8 May 2012, Business Source Complete, EBSCO host.] The high-draw products are placed in separate areas of the store to keep drawing the consumer through the store. High impulse and high margin products are placed in the most predominant areas to grab attention. Power products are placed on both sides of the aisle to create increased product awareness, and end caps are used to receive a high exposure of a certain product whether on special, promotion or in a campaign, or a new line.
The first principle of the layout is circulation. Circulation is created by arranging product so the supermarket
can control the traffic flow of the consumer. Along with this path, there will be high-draw, high-impulse items that will influence the consumer to make purchases which they did not originally intend. Service areas such as restrooms are placed in a location which draws the consumer past certain products to create extra buys. Necessity items such as bread and milk are found at the rear of the store to increase the start of circulation. Cashiers' desks are placed in a position to promote circulation. In most supermarkets, the entrance will be on the right-hand side because some research suggests that consumers who travel in a counter-clockwise direction spend more.
However, other researchers have argued that consumers moving in a clockwise direction can form better mental maps of the store leading to higher sales in turn.
The second principle of the layout is coordination. Coordination is the organized arrangement of product that promotes sales. Products such as fast-selling and slow-selling lines are placed in strategic positions in aid of the overall sales plan. Managers sometimes place different items in fast-selling places to increase turnover or to promote a new line.
![K-SupermarketTarmola](https://upload.wikimedia.org/wikipedia/commons/9/95/K-SupermarketTarmola.jpg)
The third principle is consumer convenience. The layout of a supermarket is designed to create a high degree of convenience to the consumer to make the shopping experience pleasant and increase customer spending.
This is done through the character of merchandising and product placement. There are many different ideas and theories in relation to layout and how product layout can influence the purchases made. One theory suggests that certain products are placed together or near one another that are of a similar or complementary nature to increase the average customer spend.
[Bezawada, R Balachander, S Kannan, PK Venkatesh, S 2009, "Cross-Category Effects of Aisle and Display Placements: A Spatial Modeling Approach and Insights", ''Journal of Marketing'', vol. 73, no. 3, pp. 99–117, 3 May 2012, Business Source Complete.] This strategy is used to create cross-category sales similarity. In other words, the toothpaste is next to or adjacent the toothbrushes and the tea and coffee are down the same aisle as the sweet biscuits. These products complement one another and placing them near is one-way marketers try to increase purchases.
For vertical placement, cheap generic brands tend to be on the lowest shelves, products appealing to children are placed at the mid-thigh level, and the most profitable brands are placed at eye level.
The fourth principle is the use of
color psychology
Color psychology is the study of hues as a determinant of human behavior. Color influences perceptions that are not obvious, such as the taste of food. Colors have qualities that can cause certain emotions in people. How color influences individ ...
, and the locations of the food, similar to its use in fast food branding.
Consumer psychologists suggest that most buyers tend to enter the store and shop to their right first.
Some supermarkets, therefore, choose to place the entrance to the left-hand side as the consumer will likely turn right upon entry, and this allows the consumer to do a full anticlockwise circle around the store before returning to the checkouts. This suggests that supermarket marketers should use this theory to their advantage by placing their temporary displays of products on the right-hand side to entice you to make an unplanned purchase. Furthermore, aisle ends are extremely popular with product manufacturers, who pay top dollar to have their products located there. These aisle ends are used to lure customers into making a snap purchase and to also entice them to shop down the aisle. The most obvious place supermarket layout influences consumers are at the checkout. Small displays of chocolates, magazines, and drinks are located at each checkout to tempt shoppers while they wait to be served.
Criticisms
* The large scale of supermarkets, while often improving cost and efficiency for customers, can place significant economic pressure on suppliers and smaller shopkeepers.
* Supermarkets often generate considerable
food waste
Food loss and waste is food that is not eaten. The causes of food waste or loss are numerous and occur throughout the food system, during production, processing, distribution, retail and food service sales, and consumption. Overall, about o ...
, although modern technologies such as
biomethanation
Methanogenesis or biomethanation is the formation of methane coupled to energy conservation by microbes known as methanogens. Organisms capable of producing methane for energy conservation have been identified only from the domain Archaea, a g ...
units may be able to process the waste into an economical source of energy.
Also,
purchases tracking may help as supermarkets then become better able to size their stock (of perishable goods), reducing food spoilage.
See also
*
Hypermarket
A hypermarket (sometimes called a hyperstore, supercentre or superstore) is a big-box store combining a supermarket and a department store. The result is an expansive retail facility carrying a wide range of products under one roof, including ...
*
List of grocers
This is a list of notable grocers. A grocer is a purveyor or bulk seller of food.
Grocers American
* Joe Albertson
* John Buttencourt Avila
* Joseph Azzolina
* James Butler (grocer)
* Charles Butt
* Peter P. Carr
* Joe Coulombe
* Micha ...
*
Short food supply chains
A broad range of food production-distribution-consumption configurations can be characterised as short food supply chain (SFSCs), such as farmers' markets, farm shops, collective farmers' shops, community-supported agriculture and solidarity purch ...
**
Farmers' market
A farmers' market (or farmers market according to the AP stylebook, also farmer's market in the Cambridge Dictionary) is a physical retail marketplace intended to sell foods directly by farmers to consumers. Farmers' markets may be indoors or o ...
s
*
Types of retail outlets
*
Effects of the car on societies
Since the start of the twentieth century, the role of cars has become highly important, though controversial. They are used throughout the world and have become the most popular mode of transport in many of the more developed country, developed ...
References
Further reading
*
* Longstreth, R. W. (1999). ''The Drive-In, the Supermarket, and the Transformation of Commercial Space in Los Angeles, 1914-1941''. The MIT Press.
* Lorr, B. (2020). ''The Secret Life of Groceries: The Dark Miracle of the American Supermarket''. Avery.
* Newman, K. (2012). ''The Secret Financial Life of Food: From Commodities Markets to Supermarkets'' (Illustrated edition). Columbia University Press.
* Petroski, Henry (November–December 2005)
"Shopping by Design" ''American Scientist'' 93 (6): 491.
*
Sowell, Thomas. ''Basic Economics'' (Third Edition, 2007 Basic Books). Pages 92–94 describe the competition between the dominant grocery chains in the United States through the 20th century and beyond.
* Yee, A. (2003). ''Shopping at Giant Foods: Chinese American Supermarkets in Northern California'' (Illustrated edition). University of Washington Press.
External links
Food Stories– Explore a century of revolutionary change in UK food culture on the British Library's Food Stories website
groceteria.com– supermarket history and architecture from the 1920s to the 1970s
Scrambling for customers 4 August 2005,
San Francisco Chronicle
The ''San Francisco Chronicle'' is a newspaper serving primarily the San Francisco Bay Area of Northern California. It was founded in 1865 as ''The Daily Dramatic Chronicle'' by teenage brothers Charles de Young and M. H. de Young, Michael H. de ...
{{Authority control
American inventions
Food retailing