The very elevated levels of demand we are currently seeing in grocery spending will not last forever. A lot of the uplift is driven by consumers dining out less and eating in more and, at some point, that trend will reverse. That said, some modest shifts will remain, especially from people working more from home – which means lunchtime foodservice trade is switched to buying products from supermarkets.

As such, no grocer should be expanding based solely on current trends in the market. However, there are still opportunities to expand, especially to capture market share in areas where a banner is underserved. To be prudent, grocers should ensure that their stores cater to the needs of modern consumers and are able to play a role in fulfiling online orders. That means thinking carefully about the configuration and operation of new stores, and not simply rolling out the same formats that have been used for years.

Newly-opened stores should actually over-deliver results. Consumers remain ready and committed to getting beyond the pandemic (safely, effectively, and pragmatically) — retailers must step up or step out.

When times are tough, investing in the future is paramount. I say grocers should be moving full-steam ahead and innovating wherever possible.

Opening new stores is a big decision and investment that should be taken cautiously during these uncertain times. Many of the new stores that are successful may look a lot different than traditional grocery stores. Smaller formats with curbside pickup or even “drive-thru” for some convenience stores will be more common especially in small towns or urban locations. The increase in online grocery that will likely continue with some consumers who formed new habits will also drive an increase in dark stores.

Wegmans recently opened a new store and while it was unannounced, it still garnered a lot of attention and loyal customers to its opening. I think grocers are being cautious in making sure they are taking care of their open stores with stable supply chains, and people to help support day-to-day operations. I don’t know if opening non-essential stores( apparel, shoes, etc.) is a good idea at least right now – people are still holding on to their money, spending the money on food, paying rent, and taking care of their families.

We are seeing unprecedented levels of consumer demand in the grocery space during the COVID-19 pandemic. Now is a prime opportunity for new grocery formats, re-imagined center- and perimeter-store strategies, and smaller format stores that are focusing on services, “grocerants”, cafes, sushi bars, organic foods, increased fresh and perishables, premium prepared foods, and grab-and-go offerings.

The consumer behaviors were changing and evolving before the pandemic, and now with all the disruption accelerated by COVID-19, grocers in all formats must aggressively adapt their operating models to meet the surging demands for premium prepared foods. Now is the prime opportunity to drive innovative grocery store of the future formats, develop digitally connected experiences, ignite micro-fulfillment capabilities, and continue to pivot to the changing consumer behaviors.

If a new grocery location (such as Target’s in Logan Square) or concept (such as Dom’s) was a good idea before the pandemic, it’s still a good idea. The go/no-go decision shouldn’t be based on this year’s surge in grocery sales, but in the long-term trends driving grocery sales in the first place. Cooking at home may be an elevated trend that’s here to stay, but so are small format locations in previously under-retailed urban neighborhoods. After all, Trader Joe’s success isn’t by accident.

It would be foolish to open any new grocery store that is a duplicate of what already exists. I will go further. It would be foolish to open any new grocery store whose plans were drawn before COVID-19.

Grocery shopping has changed. What we thought would happen in the next five or 10 years (or never imagined at all) has already happened. Throw out the old plans and plan a future store for today. We know what to do.

My fear is that too many grocers can’t wait to get back to the way it used to be and will make costly errors in mapping their future.

The pandemic has made significant changes in the way the consumer thinks and acts. Some of these changes are not going to go away. One of them is the way we shop for groceries and when and where we eat. Grocery stores are going to be one of the winners when it comes to the consumer dollar. Restaurants are going to be one of the losers. The new look for groceries is going to be in a lot of cases smaller and more neighborhood-specific. Now is a great time to make the move. Real estate will never be cheaper.

Stores open, close and modify formats all the time, that’s just the nature of retailing. As to the specific question, that’s hard to say because it is almost impossible to posit when a “post-pandemic” state will be achieved and conditions currently vary wildly depending on where you live, so a lot depends on where a new store is located, if it is genuinely additive or a replacement store, and a variety of other variables including whether or not a relief package clears Congress and is signed by the President. And looking forward, assuming we establish an arbitrary day – say April, 2021 – when the pandemic will be over, there are still a lot of critical unknowns including the state of the economy, unemployment rates, pandemic conditions in other countries, etc. And we know some consumers are chomping at the bit to get out and go anywhere while others have learned to enjoy picking up their groceries without ever entering a store. I think we also have to draw a distinction between stores catering to… Read more »

Whether the new stores (essential or nonessential) do more or less business depends upon whether demand exists, their inventory tracking and delivery systems can accommodate in person, online, and delivery services, and whether they offer the right assortment of products.

I believe we are cocooning right now and probably will continue to do so for the next several years so I do think grocery will be a big winner. Opening non-essential locations at this time would be a bold move — I would put a freeze on that until we know where this thing is going.

Yes, but not the same store footprint that was designed for the consumer of the 1950s. If you take the paradigm that the past six months moved grocery three years into the omnichannel world, there were other trends that are likely to have moved into prime time. Grocerants (as Brandon mentioned) but with full service for quick carry out, micro-fulfillment in the back of the store with mobile ordering to reduce the center store space (think showroom with curbside pickup), and expanded fresh and perishable sections. Let the shopper pick the product they want to shop for, browse the rest in a reduced space, or prepare mobile orders with great recommendations, all with technology in the support role.

People can only eat so much and the number of people in six months will be roughly the same as six months ago. Therefore, I would think longer term demand can generally be predicted based on pre-COVID-19 trends. Having said that, where that demand will be over the next three to five (or 10) years depends much more on macro-trends and changing customer habits. Families are becoming smaller, so there will be fewer once-a-week, fill-up two shopping carts type trips. In fact it is not very economical to even cook for two or three people, so more demand might go to picking up smaller orders closer to home. I think retailers like Target opening smaller format stores closer to work and residential hubs makes a great deal of sense for them. Brands in North America might look to those in Europe for what the landscape might look like over the next decade and they might look to South Africa for how loyalty program design and partner mix ensures capturing maximum share of wallet in a… Read more »

This is a time to be quite careful about long term investments. A great deal of the upside in business is a unique, short-term windfall from the pandemic.

Grocery needs to be careful not to misread their “Bank Error in Your Favor” Community Chest card.

Any new stores should incorporate the shopping lessons learned from COVID-19
in terms of salad bars, cashiers, cooking stations for food demos, robots, and so on. Otherwise, I would recommend investing in improving e-commerce before investing in new stores.

Smart retailers, including smart grocery retailers, know that the best time to make strategic investments is during market disruption and chaos. Opening stores is a smart investment especially if it includes enhanced on-line ordering, curbside store pick-up, and new business processes and technology to support real-time product substitution and cross-selling. I’d love to see opinions about which grocers are doing this best today.

The key factors are not related to opening or not opening — it’s about size, format, assortment, and services offered that will make or break a new grocery store. Sales may be up right now, but that won’t last long-term. These decisions need to be done based on data, but not sales data. Location still matters, especially if you’re trying to reach underserved markets. But retailers need to think about what service mix will matter, it won’t be all in-store shopping any longer and what consumers buy will also be different. Grocers that adapt to this will be the ones that successfully open new locations.