The food and grocery retail market include the retail sales of all food products, both packaged and unpackaged, as well as beverages, tobacco, and household products. Food & grocery segment is the highest contributor to the retail sector with a minimum penetration of organized retailing. The Danish population is among the highest consumers of organic food and retailers are increasingly offering organically sourced produce to meet demand.
According to study, “Food & Grocery Retailing in Denmark, Market Shares, Summary and Forecasts to 2022” some of the major companies that are currently working in the food & grocery retailing in Denmark are Rema 1000, Dagli’Brugsen&Lokalbrugsen, Super Brugsen, Netto, Fakta, Fotex, Meny, Kvickly, Spar, Aldi.
On the basis of type, food and grocery retail market are segmented into unpackaged food, packaged food, drinks, tobacco, and household products. Packaged food type is sub-segmented into bakery & cereals, canned food, chilled food, confectionery, dairy products, dried food, frozen food, ice cream, oils & fats, sauces, dressings & condiments, savory snacks, soup, and spreads. Unpackaged food type is sub-segmented into sales of unpackaged fruit, vegetables, meat, and grains. Drink type is sub-segmented into soft drinks, hot drinks, and alcoholic drinks. Tobacco type is sub-segmented into cigarettes, cigars & cigarillos and loose tobacco. Household products are sub-segmented into air fresheners, bleach, dishwashing products, and furniture cleaning products, general-purpose cleaners, insecticides, paper products, scouring products, textile washing products, and toilet care products. On the basis of category, the market is segmented into dry food grocery, milk & dairy food, spices, fresh category, perishables, and beverages. On the basis of the distribution channel, the market is segmented into supermarkets, hypermarkets, discounters, small grocery retailers and specialist retailers. On the basis of the end consumer, the market is segmented into key buyers, food and grocery product manufacturers, farmers, and agricultural cooperatives.
Some opportunities for food & grocery retailing are rising disposable income, rising consumerism, demographic dynamics, marketing exposure, increase in dual income, urbanization and largely untapped market, plastic revolution and easy mobility etc. Some threats are included new customer & rapidly changing taste & fashion, competition, frauds in retail, high real estate cost, international standards, and fluctuation in trade cycles. Some strength is involved better layout of stores & products, contribution to employment generation, reduction in intermediaries & efficient supply chain, modern technology adaption, government revenue, consumer well-being, cost-effective and availability of product & raw material. Additionally, some of the weaknesses are an inconsiderable regulatory framework, lack of infrastructural development, limited consumer insight lack of skilled & trained workforce and ineffective complaint handling system etc.
In 2017, there were 1,496 grocery discounters in Denmark. Increasing demand for organic food drives the food & grocery sector. Hypermarkets are leading distribution channel of these sector sales. In 2018, revenue in the food & grocery segments amounts to US$477m, which shows an annual growth rate of 11.7%, is resulting in a market volume of US$742m by 2022. This sector’s user penetration rate is 13.3% and is expected to hit 15.6% by 2022. Denmark retail market is forecasted to grow at a CAGR of 2.3% during 2017-2022. Rema 1000 is the largest player in a consolidated food & grocery market. Additionally, increased consumer demand for more convenient shopping options will boost online food and grocery sales through the end of the decade.
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Ankur Gupta, Head Marketing & Communications