Dive Brief:

  • Independent grocers now account for 33% of U.S. grocery sales, up from 25% a decade ago, an economic study from the National Grocers Association (NGA) found.
  • Sales at independent stores increased almost 94% between 2012 and 2020, to $253.6 billion, while overall U.S. grocery sales increased roughly 47% to $772 billion during the same period.
  • Despite recent sales momentum, independents face growing competition and anti-competitive practices from big box and dollar stores, the NGA said.

Dive Insight:

The NGA study also noted that independent grocers account for more industry jobs than they did a decade ago, with 1.1 million workers earning a collective $39 billion. Independents also help support nearly 860,000 jobs across other industries like agriculture, manufacturing and transportation, the study noted.

Tempering these increases, however, are competitive pressures from dollar stores and other chains, magnified by favorable pricing deals for these companies, according to NGA.

“Despite this growth over the past decade, independents appear to be losing a foothold in rural and inner-city low-income areas,” NGA President and CEO Greg Ferrara said in a statement. “NGA is working to reverse this trend through a comprehensive antitrust advocacy approach that would rein in growing power-buyer influence and encourage grocery investment in disadvantaged communities.”

In March, NGA called on Congress to strengthen antitrust laws to protect independent grocers, saying that “power buyers” have used industry disruption and unprecedented consumer demand brought on by the pandemic to gain unfair business advantages.

The economic study, which was conducted by John Dunham & Associates, highlighted other challenges independents faced while growing their sales, including food inflation, which had an average rate of 1.69% per year between 2012 and 2020.

Even with the challenges, more independent grocers have worked to accept SNAP benefits online, which can help people who are food insecure, the study noted. The number of grocers offering SNAP online purchasing continues to expand after previously being dominated by Amazon and Walmart.

Independents represent 1.2% of the 2020 U.S. gross domestic product of $20.93 trillion, with a total output exceeding $255 billion, according to the study.