Grocery Market in India 2024-2028

The India grocery market size is forecast to increase by USD 310 billion at a CAGR of 8.1% between 2023 and 2028. The food retail market, encompassing consumer goods and household essentials such as food, beverages, and household essentials, is witnessing significant growth trends.

One notable trend is the increasing popularity of m-commerce, with more consumers opting for online grocery shopping. Another trend is the rising demand for functional foods and beverages, as consumers prioritize health and wellness. However, there remains a mixed perception among end-users regarding online grocery shopping, with some preferring the tactile experience of physical stores. Despite this, the convenience and time-saving benefits of online shopping continue to attract a growing number of customers. Additionally, the consumer products industry is evolving to meet changing consumer preferences, with a focus on sustainability, transparency, and customization. Overall, these trends present both opportunities and challenges for market participants in the food retail sector.

The global grocery market is a dynamic and ever-evolving industry that caters to the consumer needs for food, beverages, household essentials, and personal care items. This sector, often referred to as food retail or consumer goods, plays a vital role in the daily lives of consumers worldwide. Let's explore some key trends shaping the future of this industry. Online-Grocery Sales: With the increasing popularity of e-commerce and the convenience it offers, online grocery sales have been on a steady rise. Consumers are increasingly opting for the convenience of shopping for their essentials online, especially in the wake of the pandemic.

Grocery retailers are increasingly focusing on merchandising strategies to attract and retain customers. Private-label goods, which offer better margins and customer loyalty, have become an essential part of the merchandising mix. The lines between brick-and-mortar and online retail are blurring, with many retailers adopting an omnichannel approach. This strategy allows consumers to shop seamlessly across multiple channels, including physical stores, e-commerce platforms, and mobile apps. Consumers appreciate the convenience of having their groceries delivered right to their doorstep or available for pickup at a convenient time. The rise of e-commerce and internet shopping has transformed the grocery industry. Consumers can now shop for their essentials from the comfort of their homes, and retailers are investing heavily in technology to offer a seamless shopping experience.

Consumers are increasingly conscious of the environmental impact of their shopping habits. Grocery retailers are responding by offering sustainable delivery options, such as electric vehicles, and eco-friendly packaging solutions. The integration of technology into the grocery shopping experience is a key trend. Consumers can now use internet services, such as voice assistants and mobile apps, to shop for their essentials, make payments using virtual methods, and even track their orders using smart devices. Online platforms, such as social media and food delivery apps, are becoming essential tools for grocery retailers to reach and engage with consumers. These platforms offer opportunities for targeted marketing, customer engagement, and real-time communication. In conclusion, the global grocery market is undergoing significant changes, driven by consumer preferences, technology, and competition. Retailers that can adapt to these trends and offer a seamless shopping experience across multiple channels are likely to thrive in this dynamic industry.

Market Segmentation

The market report provides comprehensive data (region-wise segment analysis), with forecasts and estimates in "USD billion" for the period 2024-2028, as well as historical data from 2018-2022 for the following segments.

• Platform
  • Offline
  • Online
• Product
  • Food grains
  • Bread bakery and dairy products
  • Fruits and vegetables
  • Personal care
  • Others
• Geography
  • India

By Platform Insights

The offline segment is estimated to witness significant growth during the forecast period. In the realm of grocery retail, personal care items have emerged as significant contributors to sales, particularly in the merchandising strategies of supermarkets and hypermarkets. These large-format stores, including discount stores, cash and carry outlets, and convenience stores, have become preferred destinations for consumers seeking a wide range of grocery options. The convenience of having all categories of products available under one roof, coupled with the ability to compare prices and brands, drives consumer preference toward these channels.

The offline segment accounted for USD 411.00 billion in 2018 and showed a gradual increase during the forecast period. Moreover, the rise of online-grocery sales has not diminished the importance of offline retail. Supermarkets and hypermarkets continue to attract shoppers due to their expansive shelf spaces and storage areas, enabling them to offer a diverse selection of grocery products. Additionally, these stores often provide discounts and freebies when consumers reach a certain purchase threshold, further boosting sales. Cooking at home remains a popular trend, making the grocery market a thriving sector in retail.

The researchers analyzed the data with 2023 as the base year, along with the key drivers, trends, and challenges. A holistic analysis of drivers will help companies refine their marketing strategies to gain a competitive advantage.

Market Driver

Rapid growth in m-commerce is notably driving market growth. The Indian online grocery market has experienced significant growth, particularly in the mobile-based or m-commerce sector. This trend is largely driven by the widespread use of smartphones in India, enabling consumers to shop for food, beverages, consumer goods, and household essentials from anywhere and at any time. Major e-commerce and online retail players, including Amazon.com Inc, have recognized this trend and have either shifted their focus to m-commerce or offer services through both channels.

Metropolitan cities, such as Mumbai, Delhi, Hyderabad, and Bangalore, exhibit high penetration of e-commerce due to the prevalent use of laptops and desktops. The increasing demand for m-commerce presents a lucrative growth opportunity for online retailers in these urban areas. Thus, such factors are driving the growth of the market during the forecast period.

Market Trends

Growth in demand for functional foods and beverages is the key trend in the market. The food retail industry in the country is witnessing a significant shift towards consumer goods and products, particularly in the sectors of food, beverages, and household essentials. Health-conscious consumers, driven by the increasing prevalence of obesity and other health conditions, are seeking out functional food and beverage items. These products cater to the growing trend of health and wellness lifestyles, particularly among the younger demographic of 18-32 years. Consumers are willing to pay a premium price for these items, which offer various functional benefits such as reduced fat and other health-promoting attributes. However, the availability of these products remains limited, even in large-scale supermarkets and hypermarkets. This presents an opportunity for retailers to expand their offerings and cater to the evolving needs of health-conscious consumers. Thus, such trends will shape the growth of the market during the forecast period.

Market Challenge

End-user mixed perception of online grocery shopping is the major challenge that affects the growth of the market. The Indian grocery market, encompassing food, beverages, and household essentials, is witnessing a steady expansion. However, transforming the mindset of a significant consumer base remains a challenge for companies. End-users, particularly those purchasing food items, prioritize freshness and satisfaction. Many continue to prefer traditional offline retail stores for their shopping needs.

Further, the tactile experience of personally selecting and inspecting products is a significant factor influencing their decision-making process. Despite the growing popularity of e-commerce platforms, the grocery sector in India is yet to fully embrace digital transformation. companies must focus on addressing consumer concerns and creating a positive impact to gain market traction. Hence, the above factors will impede the growth of the market during the forecast period

Exclusive Customer Landscape

The market forecasting report includes the adoption lifecycle of the market, covering from the innovator's stage to the laggard's stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the market forecast report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their market growth analysis strategies.

Key Companies & Market Insights

Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.

Amazon.com Inc.: The company offers groceries such as fresh fruits and vegetables, cheese, dry fruits, dals, and home care items under its brand AmazonFresh.

The market research and growth report also includes detailed analyses of the competitive landscape of the market and information about key companies, including:

• Avenue Supermarts Ltd.
• B L Agro Industries Ltd.
• Blink Commerce Pvt. Ltd.
• Brisam Retail Pvt. Ltd.
• Dookan Technologies s.r.o
• Dunzo Digital Pvt. Ltd.
• Flora foods
• FRESHTOHOME FOODS Pvt. Ltd.
• GFOI retail Pvt. Ltd.
• Heritage Foods Ltd.
• Innovative Retail Concepts Pvt. Ltd.
• One97 Communications Ltd.
• Reliance Industries Ltd.
• RP Sanjiv Goenka Group
• Satvika Bio Foods India Pvt. Ltd.
• SPAR Group Inc.
• Tata Sons Pvt. Ltd.
• Walmart Inc.
• Zepto

Qualitative and quantitative analysis of companies has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize companies as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize companies as dominant, leading, strong, tentative, and weak.

Market Analyst Overview

The food retail industry encompasses the sale of consumer goods, including food, beverages, household essentials, and personal care items. In recent years, grocery shopping behaviors have shifted towards online channels, with e-commerce playing a significant role in the industry's growth. Online retailers offer convenience through various delivery models such as curbside pickup and direct-to-door delivery. The online grocery industry has gained traction due to the increasing trend of cooking at home and the convenience it provides. Consumers can now purchase a wide range of food cupboard products, specialty items, and private-label goods from the comfort of their homes. Merchandising strategies have evolved to cater to this new shopping landscape, with retailers leveraging online platforms, internet services, smart devices, and virtual payment methods to enhance the shopping experience. Grocery sales through e-commerce channels continue to grow, driven by the convenience and flexibility they offer. Omnichannel mass merchandisers have embraced this trend, integrating their physical and online channels to provide a seamless shopping experience. Sustainable delivery and eco-friendly packaging are becoming essential considerations for consumers and retailers alike, with many adopting green initiatives to reduce their carbon footprint.

The Indian food and grocery retail market is a dynamic and evolving sector, witnessing significant growth and transformation in recent years. This market, encompassing both online and offline channels, is a crucial component of the country's overall retail industry. Online purchasing through ecommerce businesses, such as buy online pickup instore (BOPIS) and doorstep product delivery, has gained immense popularity. Retail brands have capitalized on this trend, offering consumers the convenience of shopping from the comfort of their homes. However, physical shopping at specialty shops and traditional markets continues to thrive, with extended shopping hours catering to the busy lifestyles of urban consumers. The food and grocery retail market in India is characterized by a diverse consumer base, with varying preferences and demands. This diversity necessitates a multi-channel approach, allowing retailers to cater to both online and offline shoppers. As the market continues to evolve, the focus on providing seamless shopping experiences, competitive pricing, and high-quality products will remain key differentiators. In conclusion, the Indian food and grocery retail market offers immense opportunities for growth and innovation, with a blend of traditional and modern retail formats, and the convergence of online and offline channels. Whether it's the convenience of doorstep delivery or the sensory experience of physical shopping, consumers in India have a wealth of options to choose from.