Convenience stores set to grow by 30% in next five years to hit £50 billion in sales
The rise in local top up shopping is set to continue over the coming years with the overall UK convenience market set to be worth £49 billion by 2019, growing by over 30% over the next five years according to the IGD (Institute of Grocery Distribution).
The sector will continue to be dominated by convenience chains of the major multiples and the growing distribution of symbol groups like Costcutter and Spar.
Symbol groups currently account for over £4 in every £10 spent in UK convenience stores and are becoming of increasing importance to wine and spirits suppliers. The breakdown of the UK convenience market is shown below:
| Convenience sales 2014£m | Share of sales 2014% | Sales change year to April 2014% | |
|---|---|---|---|
Symbol groups | 15,537 | 42 | 5.1 |
Convenience multiples | 7,277 | 19 | 16.3 |
Unaffiliated independents | 6,528 | 17 | -0.1 |
Convenience forecourts | 3,962 | 11 | -0.5 |
Co-operatives | 4,125 | 11 | 2.3 |
Total convenience | 37,430 | 100 | 5.2 |
Source: IGD Retail Analysis. Please note individual segments do not add up to the total convenience value due to rounding
Unaffiliated independent stores and merchants account for the largest number of convenience stores by number, closely followed by symbol groups, but their scale is not reflected in their share of overall sales. Unaffiliated and symbol groups account for over 70% of the total number of convenience stores.
| Number of stores2014 | Share of stores 2014% | Stores change year to April 2014% | |
|---|---|---|---|
Unaffiliated independents | 18,630 | 38 | -1.0 |
Symbol groups | 17,080 | 34 | 2.8 |
Convenience forecourts | 7,418 | 15 | -1.6 |
Convenience multiples | 3,771 | 8 | 13.6 |
Co-operatives | 2,680 | 5 | 1.6 |
Total convenience | 49,579 | 100 | 1.3 |
Source: IGD Retail Analysis and William Reed Business Media
Joanne Denney-Finch, chief executive, of the IGD, said: "The convenience sector continues to build on its success and we're forecasting almost £12bn in extra sales between now and 2019.
"Convenience stores are benefiting from changing social demographics, such as smaller households, and shoppers spreading more of their spending across a variety of grocery formats. Our latest ShopperVista research shows that seven out of ten (71%) of them are using both a supermarket and convenience shop in any given month.
"Our 24-hour, seven day a week society means people can buy anything, anywhere and at any time.
Convenience stores are well placed to make the most of this trend as shoppers use them more than any other type of grocery format.
"Building on the success of click and collect, convenience shops continue to offer a link between digital and physical shopping - acting both as a drop-off and collection point. This also provides another reason for shoppers to visit, helping them combine two tasks in one journey.
"With all types of retailers focusing so much on convenience, it's an incredibly exciting time to be involved in this sector. However, it's vital convenience shops stay close to shoppers changing needs and keep innovating to maintain this momentum. One convenience operator, for example, tweets alerts about seasonal products while another has an interactive digital 'smart pad' allowing customers to view local suppliers and leave feedback."
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