Food suppliers need to target new retail formats to survive in the new grocery landscape, according to Charles Wilson, chief executive of Booker Group and keynote speaker at the City Food Lecture.
Wilson said that after 60 years of growth, supermarkets are starting to slow down and do not offer the same investment for suppliers.
He told the 450 delegates: “Supermarkets are expected to grow by 8 per cent in the next five years. Online is expected grow by 98 per cent, the discounters by 65 per cent and the convenience sector by 29 per cent.”
Wilson said premium retailers are doing well as there has been a shift towards high-quality among consumers. He also highlighted new retail formats expected to grow including delis, farm shops and nutri-specialists.
“Farm shops are a wonderful model as they allow the supplier to re-engage directly with the consumer,” Wilson said.
“All these sectors are growing faster than supermarkets. Suppliers need to go where the growth is: foodservice outlets, convenience channels, discounters, new formats and emerging countries.
“In this new grocery landscape there are some huge opportunities for astute suppliers.”
He added that collective share of the top four retailers dropped by 1 per cent during 2011 and 2013, despite the fact collective capital spend during this period was £12 billion.
According to Wilson, choice and product range will continue to proliferate and suppliers should be 'smarter' when placing products into the right channel.
He concluded: “Suppliers will have to redefine their trade strategies, but the rewards will be substantial as there is plenty of growth outside the supermarkets.”
The 13th City Food Lecture took place in London’s Guildhall on Monday 17 February. It was organised by the Livery Companies of the City, including the Worshipful Company of Fruiterers, and attended by Past Master of the Butchers' Company HRH the Princess Royal, who made the closing remarks.
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