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A supermarket is a
self-service Self-service is the practice of serving oneself, usually when making purchases. Aside from Automatic Teller Machines, which are not limited to banks, and customer-operated supermarket check-out, labor-saving of which has been described as self- ...
shop Shop or shopping refers to: Business and commerce * Shop, a slang word for a commerce , commercial establishment or for a place of business * Machine shop, a workshop for machining * Retail shop, possibly within a marketplace * Shopping, e.g.: * ...
offering a wide variety of
food Food is any substance consumed to provide Nutrient, nutritional support for an organism. Food is usually of plant, animal or Fungus, fungal origin, and contains essential nutrients, such as carbohydrates, fats, protein (nutrient), proteins, vi ...

food
,
beverages A drink (or beverage) is a liquid A liquid is a nearly incompressible In fluid mechanics or more generally continuum mechanics, incompressible flow (isochoric process, isochoric flow) refers to a fluid flow, flow in which the material d ...

beverages
and household products, organized into sections. This kind of store is larger and has a wider selection than earlier
grocery store A grocery store (North America), grocery or grocery shop (UK) is a store that primarily retails a general range of food products, which may be fresh Fresh or FRESH may refer to: People *DJ Fresh Daniel Edward Stein (born 11 April 197 ...

grocery store
s, but is smaller and more limited in the range of merchandise than a
hypermarket A hypermarket (sometimes called a hyperstore, supercentre or superstore) is a big-box store A big-box store (also hyperstore, supercenter, superstore, or megastore) is a physically large retail establishment, usually part of a chain Im ...
or big-box market. In everyday
U.S. The United States of America (USA), commonly known as the United States (U.S. or US), or America, is a country primarily located in North America North America is a continent entirely within the Northern Hemisphere and almost all ...

U.S.
usage, however, "grocery store" is synonymous with supermarket, and is not used to refer to other types of stores that sell groceries. The supermarket typically has places for fresh meat, fresh
produce Produce is a generalized term for many farm-produced crops, including fruits and vegetables (grains, oats, etc. are also sometimes considered ''produce''). More specifically, the term ''produce'' often implies that the products are wikt:fresh, fr ...

produce
,
dairy A dairy is a business enterprise Business is the activity of making one's living or making money by producing or buying and selling products (such as goods and services). Simply put, it is "any activity or enterprise entered into for profi ...

dairy
,
deli Deli may refer to: * Delicatessen, a shop selling specially prepared food, or food prepared by such a shop * Sultanate of Deli, a former sultanate in North Sumatra, Indonesia Places * Deli, Boyer-Ahmad, a village in Kohgiluyeh and Boyer-Ahmad Provi ...
items, baked goods, etc. Shelf space is also reserved for canned and packaged goods and for various non-food items such as
kitchenware:'' For a record label, see Kitchenware Records Kitchenware Records was an independent record label An independent record label (or indie label) is a record label that operates without the funding of major record labels; they are a type of sma ...

kitchenware
,
household cleaner A detergent is a surfactant Surfactants are compounds that lower the surface tension (or interfacial tension) between two liquids, between a gas and a liquid, or between a liquid and a solid. Surfactants may act as detergents, wetting ...
s,
pharmacy Pharmacy is the clinical health science The following Outline (list), outline is provided as an overview of and topical guide to health sciences: Health sciences – are those sciences which focus on health, or health care, as core p ...

pharmacy
products and pet supplies. Some supermarkets also sell other household products that are consumed regularly, such as alcohol (where permitted), medicine, and
clothing Clothing (also known as clothes, apparel, and attire) are items worn on the body. Typically, clothing is made of fabrics or textile A textile is a flexible material made by creating an interlocking bundle of yarn Yarn is a long ...

clothing
, and some sell a much wider range of non-food products:
DVD The DVD (common abbreviation for Digital Video Disc or Digital Versatile Disc) is a digital Digital usually refers to something using digits, particularly binary digits. Technology and computing Hardware *Digital electronics Digital electr ...

DVD
s, sporting equipment, board games, and seasonal items (e.g.,
Christmas Christmas is an annual festival commemorating Nativity of Jesus, the birth of Jesus Christ, observed primarily on December 25 as a religious and cultural celebration among billions of people Observance of Christmas by country, around the world ...
wrapping paper Gifts wrapped in the traditional Japanese wrapping called Furoshiki. Gift wrapping is the act of Packaging and labelling, enclosing a gift in some sort of material. Wrapping paper is a kind of paper designed for gift wrapping. An alternative to gi ...
in December). A larger full-service supermarket combined with a
department store A department store is a retail Retail is the sale of goods In economics Economics () is the social science that studies how people interact with value; in particular, the Production (economics), production, distribution (economics) ...
is sometimes known as a
hypermarket A hypermarket (sometimes called a hyperstore, supercentre or superstore) is a big-box store A big-box store (also hyperstore, supercenter, superstore, or megastore) is a physically large retail establishment, usually part of a chain Im ...
. Other services may include those of banks, cafés, childcare centers/creches, insurance (and other financial services),
mobile phone A mobile phone, cellular phone, cell phone, cellphone, handphone, or hand phone, sometimes shortened to simply mobile, cell or just phone, is a portable telephone A telephone is a telecommunication Telecommunication is the tra ...

mobile phone
services, photo processing, video rentals, pharmacies, and
gas stations A filling station is a facility that sells fuel and engine lubricants for motor vehicles. The most common fuels sold in the 2010s were gasoline (''gasoline'' or ''gas'' in the United States and Canada, generally ''petrol'' elsewhere) and die ...

gas stations
. If the eatery in a supermarket is substantial enough, the facility may be called a "grocerant", a blend of "grocery" and "restaurant". The traditional supermarket occupies a large amount of floor space, usually on a single level. It is usually situated near a residential area in order to be convenient to consumers. The basic appeal is the availability of a broad selection of goods under a single roof, at relatively low prices. Other advantages include ease of parking and frequently the convenience of shopping hours that extend into the evening or even 24 hours of the day. Supermarkets usually allocate large budgets to advertising, typically through newspapers. They also present elaborate in-shop displays of products. Supermarkets typically are
chain store A chain store or retail chain is a retail Retail is the sale of goods In economics Economics () is the social science that studies how people interact with value; in particular, the Production (economics), production, distributio ...
s, supplied by the
distribution center A distribution center for a set of Product (business), products is a warehouse or other specialized building, often with refrigeration or air conditioning, which is stocked with products (good (economics), goods) to be redistributed to retaili ...
s of their parent companies, thus increasing opportunities for
economies of scale In microeconomics Microeconomics is a branch of mainstream economics Mainstream economics is the body of knowledge, theories, and models of economics, as taught by universities worldwide, that are generally accepted by economists as a basis ...

economies of scale
. Supermarkets usually offer products at relatively low prices by using their buying power to buy goods from manufacturers at lower prices than smaller stores can. They also minimise financing costs by paying for goods at least 30 days after receipt and some extract credit terms of 90 days or more from vendors. Certain products (typically staple foods such as bread, milk and sugar) are very occasionally sold as
loss leader A loss leader (also leader) is a pricing strategy where a product is sold at a price below its market cost to stimulate other sales of more profitable goods or services. With this sales promotion Sales promotion is one of the elements of the prom ...
s so as to attract shoppers to their store. Supermarkets make up for their low margins by a high volume of sales, and with of higher-margin items bought by the attracted shoppers. Self-service with shopping carts (trolleys) or
baskets A basket is a container that is traditionally constructed from stiff fibers and can be made from a range of materials, including wood splints, runners, and cane. While most baskets are made from plant materials, other materials such as horsehai ...

baskets
reduces labor costs, and many supermarket chains are attempting further reduction by shifting to self-service check-out.


History

In the early days of retailing, generally an assistant fetched products from shelves behind the merchant's counter while customers waited in front of the counter, indicating the items they wanted. Most foods and merchandise did not come in individually wrapped consumer-sized packages, so an assistant measured out and wrapped the precise amount requested by the consumer. This offered opportunities for social interaction: many regarded this style of shopping as "a social occasion" and would often "pause for conversations with the staff or other customers". These practices were by nature slow and had high
labor intensity Labor intensity is the relative proportion of Labour (economics), labor (compared to Capital (economics), capital) used in any given process. Its inverse is capital intensity. Labor intensity has been declining since the onset of the Industrial Re ...
and therefore also quite expensive. The number of customers who could be attended to at one time was limited by the number of staff employed in the store. Shopping for groceries also often involved trips to multiple specialty shops, such as a
greengrocer A greengrocer is a person who owns or operates a shop selling primarily produce, fruit and vegetables. The term may also be used to refer to a shop selling primarily produce Produce is a generalized term for many farm-produced crops, includ ...
,
butcher A butcher is a person who may slaughter animals, dress their flesh, sell their meat, or participate within any combination of these three tasks. They may prepare standard cuts of meat and poultry for sale in retail or wholesale food establishme ...

butcher
,
bakery A bakery is an Business, establishment that produces and sells flour-based food Baking, baked in an oven such as bread, cookies, cakes, Pastry, pastries, and pies. Some retail bakeries are also categorized as Coffeehouse, cafés, serving coffee and ...

bakery
,
fishmonger A fishmonger (historically fishwife for female practitioners) is someone who sells raw fish and seafood. Fishmongers can be wholesalers or retailers, and are trained at selecting and purchasing, handling, gutting, boning, fillet (cut), filleting, d ...

fishmonger
and
dry goods Dry goods is a historic term describing the type of product line a store carries, which differs by region. The term comes from the textile trade, and the shops appear to have spread with the mercantile trade across the British Empire (and Commonw ...
store, in addition to a
general store A general merchant store (also known as general merchandise store, general dealer or village shop) is a rural or small-town Retailing, store that carries a general line of merchandise. It carries a broad selection of merchandise, sometimes in a ...

general store
. Milk and other items of short
shelf life Shelf life is the length of time that a commodity may be stored without becoming unfit for use, consumption, or sale. In other words, it might refer to whether a commodity should no longer be on a pantry shelf (unfit for use), or just no longer ...
were delivered by a
milkman An Indian milkman on his motorbike Milk delivery is a delivery service dedicated to supplying milk Milk is a nutrient-rich liquid food produced by the mammary gland A mammary gland is an exocrine gland in humans and other mammals th ...

milkman
. The concept of an inexpensive food market relying on economies of scale was developed by
Vincent Astor William Vincent Astor (November 15, 1891 – February 3, 1959) was an American businessman, philanthropist, and member of the prominent Astor family. Early life Called Vincent, he was born in New York City New York City (NYC), often simply ...
. He founded the Astor Market in 1915, investing $750,000 of his fortune into a 165′ by 125′ (50×38-metre) corner of 95th and Broadway,
Manhattan Manhattan (), known regionally as ''The City'', is the most densely populated and geographically smallest of the five boroughs 5 is a number, numeral, and glyph. 5, five or number 5 may also refer to: * AD 5, the fifth year of the AD era ...

Manhattan
, creating, in effect, an open-air mini-mall that sold meat, fruit, produce and flowers. The expectation was that customers would come from great distances ("miles around"), but in the end, even attracting people from ten blocks away was difficult, and the market folded in 1917. The concept of a self-service grocery store was developed by entrepreneur Clarence Saunders and his
Piggly Wiggly Piggly Wiggly is an American supermarket chain operating in the Southern and Midwestern regions of the United States, run by Piggly Wiggly, LLC, an affiliate of C&S Wholesale Grocers. Its first outlet opened in 1916 in Memphis, Tennessee ...

Piggly Wiggly
stores, the first of which opened in 1916. Saunders was awarded several patents for the ideas he incorporated into his stores. The stores were a financial success and Saunders began to offer franchises.
The Great Atlantic & Pacific Tea Company The Great Atlantic & Pacific Tea Company, better known as A&P, was an American chain store, chain of grocery stores that operated from 1859 to 2015. From 1915 through 1975, A&P was the largest grocery retailer in the United States (and, until 19 ...
, which was established in 1859, was another successful early grocery store chain in Canada and the United States, and became common in North American cities in the 1920s. Early self-service grocery stores did not sell fresh meats or produce. Combination stores that sold perishable items were developed in the 1920s. The general trend since then has been to stock shelves at night so that customers, the following day, can obtain their own goods and bring them to the front of the store to pay for them. Although there is a higher risk of
shoplifting Shoplifting is the theft of goods from an open retail establishment, typically by concealing a store item on one's person, in pockets, under clothes, or in a bag, and leaving the store without paying. With clothing, shoplifters may put on items ...
, the costs of appropriate security measures ideally will be outweighed by reduced labor costs. Historically, there has been debate about the origin of the supermarket, with King Kullen and
Ralphs Ralphs is an American supermarket Chain stores, chain in Southern California. The largest subsidiary of Cincinnati-based Kroger, it is the oldest such chain west of the Mississippi River. Kroger also operates stores under the Food 4 Less and Fo ...

Ralphs
of California having strong claims. Other contenders included Weingarten's and Henke & Pillot. To end the debate, the
Food Marketing Institute FMI - The Food Industry Association, is a national trade association A trade association, also known as an industry trade group, business association, sector association or industry body, is an organization founded and funded by businesses that o ...
in conjunction with the
Smithsonian Institution The Smithsonian Institution ( ), or simply, the Smithsonian, is a group of museums and education and research centers, the largest such complex in the world, created by the U.S. government "for the increase and diffusion of knowledge". Founded ...

Smithsonian Institution
and with funding from H.J. Heinz, researched the issue. They defined the attributes of a supermarket as "self-service, separate product departments, discount pricing, marketing and volume selling". They determined that the first true supermarket in the United States was opened by a former
Kroger The Kroger Company, or simply Kroger, is an American retail company founded by Bernard Kroger in 1883 in Cincinnati, Cincinnati, Ohio. It is the United States' largest supermarket by revenue ($121.16 billion for fiscal year 2019), and the ...
employee, Michael J. Cullen, on 4 August 1930, inside a former garage in
Jamaica, Queens Jamaica is a middle-class neighborhood in the New York City Borough (New York City), borough of Queens. It is mainly composed of a large commercial and retail area, though part of the neighborhood is also residential. Jamaica is bordered by Hol ...
in New York City. The store, King Kullen, operated under the slogan "Pile it high. Sell it low." At the time of Cullen's death in 1936, there were seventeen King Kullen stores in operation. Although Saunders had brought the world self-service, uniform stores, and nationwide marketing, Cullen built on this idea by adding separate food departments, selling large volumes of food at discount prices and adding a parking lot. Other established American grocery chains in the 1930s, such as Kroger and
Safeway Inc. Safeway is an American supermarket A supermarket is a self-service shop offering a wide variety of food Food is any substance consumed to provide nutritional support for an organism In biology, an organism (from Ancient Gree ...
at first resisted Cullen's idea, but eventually were forced to build their own supermarkets as the economy sank into the
Great Depression The Great Depression was a severe worldwide economic depression An economic depression is a sustained, long-term downturn in economic activity in one or more economies. It is a more severe economic downturn than a economic recession, recess ...
, while consumers were becoming price-sensitive at a level never experienced before. Kroger took the idea one step further and pioneered the first supermarket surrounded on all four sides by a
parking lot Car park with drop arm in Dazaifu, Fukuoka A parking lot (American English American English (AmE, AE, AmEng, USEng, en-US), sometimes called United States English or U.S. English, is the set of varieties of the English language nat ...

parking lot
. As larger chain supermarkets began to dominate the market in the US, able to supply consumers with the desired lower prices as opposed to the smaller "mom and pop" stands with considerably more overhead costs, the backlash of this infrastructure alteration was seen through numerous anti-chain campaigns. The idea of "monopsony", proposed by Cambridge economist Joan Robinson in 1933, that a single buyer could out-power the market of multiple sellers, became a strong anti-chain rhetorical device. With public backlash came political pressure to even the playing field for smaller vendors lacking the luxury of economies of scale. In 1936, the Robinson-Patman Act was implemented as a way of preventing such larger chains from using this buying power to reap advantages over smaller stores, although the act was not well enforced and did not have much impact on the prevention of larger chains overtaking power in the markets. Supermarkets proliferated across Canada and the United States with the growth of automobile ownership and suburban development after World War II. Most North American supermarkets are located in suburban strip shopping centers as an anchor store along. They are generally regional rather than national in their company branding. Kroger is perhaps the most nationally oriented supermarket chain in the United States but it has preserved most of its regional brands, including
Ralphs Ralphs is an American supermarket Chain stores, chain in Southern California. The largest subsidiary of Cincinnati-based Kroger, it is the oldest such chain west of the Mississippi River. Kroger also operates stores under the Food 4 Less and Fo ...

Ralphs
, ,
King Soopers King Soopers is a supermarket A supermarket is a self-service shop offering a wide variety of food Food is any substance consumed to provide nutritional support for an organism In biology, an organism (from Ancient Greek, Gre ...
, Fry's, Smith's, and
QFC Quality Food Centers (QFC) is a supermarket A supermarket is a self-service shop offering a wide variety of food Food is any substance consumed to provide nutritional support for an organism In biology, an organism (from Anc ...

QFC
. In Canada, the largest such company is
Loblaw Loblaw Companies Limited is a Canadian food retailer Retail is the sale of goods and Service (economics), services to consumers, in contrast to wholesaling, which is sale to business or institutional customers. A retailer purchases goods in l ...
, which operates stores under a variety of banners targeted to different segments and regions, including
Fortinos Fortinos is a Canadian supermarket A supermarket is a self-service Retail#Types of outlets, shop offering a wide variety of food, Drink, beverages and Household goods, household products, organized into sections. This kind of store is larg ...

Fortinos
,
Zehrs Zehrmart Inc. ( doing business as Zehrs Markets or simply Zehrs), is a Canadian supermarket chain in southern Ontario Southern Ontario is a primary region of the province A province is almost always an administrative division within a cou ...
,
No Frills A no-frills or no frills service or product is one for which the non-essential features have been removed to keep the price low. The term "" originally refers to a style of fabric decoration. Something offered to customers for no additional charge ...
, the Real Canadian Superstore, and Loblaws, the foundation of the company.
Sobeys Sobeys Inc. is the second largest food retailer in Canada Canada is a country in the northern part of North America. Its Provinces and territories of Canada, ten provinces and three territories extend from the Atlantic Ocean, Atlantic to ...
is Canada's second largest supermarket with locations across the country, operating under many banners (Sobeys IGA in
Quebec ) , image_shield=Armoiries du Québec.svg , image_flag=Flag of Quebec.svg , coordinates= , AdmittanceDate=July 1, 1867 , AdmittanceOrder=1st, with New Brunswick ("Hope restored") , image_map = New Brunswick in Canada 2.svg , ...

Quebec
). Québec's first supermarket opened in 1934 in Montréal, under the banner Steinberg's. In the United Kingdom, self-service shopping took longer to become established. Even in 1947, there were just ten self-service shops in the country. In 1951, ex-US Navy sailor Patrick Galvani, son-in-law of
Express Dairies Express Dairies is a former brand of Dairy Crest, that specialised almost entirely in home deliveries of milk, and other dairy products. History The company was founded by George Barham in 1864 as the 'Express County Milk Supply Company,' so nam ...
chairman, made a pitch to the board to open a chain of supermarkets across the country. The UK's first supermarket under the new
Premier Supermarkets Express Dairies is a former brand of Dairy Crest, that specialised almost entirely in home deliveries of milk, and other dairy products. History The company was founded by George Barham in 1864 as the 'Express County Milk Supply Company,' so name ...
brand opened in
Streatham Streatham ( ) is a district in south London London is the capital Capital most commonly refers to: * Capital letter Letter case (or just case) is the distinction between the letters that are in larger uppercase or capitals (o ...

Streatham
,
South London South London is the informally defined southern part of London London is the and of and the . It stands on the in south-east England at the head of a down to the , and has been a major settlement for two millennia. The , its ancient ...

South London
, taking ten times as much per week as the average British general store of the time. Other chains caught on, and after Galvani lost out to Tesco's Jack Cohen in 1960 to buy the 212 Irwin's chain, the sector underwent a large amount of consolidation, resulting in 'the big four' dominant UK of today:
Tesco Tesco plc () is a British multinational Multinational may refer to: * Multinational corporation, a corporate organization operating in multiple countries * Multinational force, a military body from multiple countries * Multinational state, a ...

Tesco
, (owned by
Wal-Mart Walmart Inc. (; formerly Wal-Mart Stores, Inc.) is an American multinational retail corporation that operates a chain of hypermarket Asian hypermarket in the Philippines, a branch of SM Hypermarket in SM Mall of Asia">SM_Hypermarket.html ...

Wal-Mart
),
Sainsbury's J Sainsbury plc, trading as Sainsbury's, is the second largest chain of supermarket A supermarket is a self-service Retail#Types of outlets, shop offering a wide variety of food, Drink, beverages and Household goods, household products, ...

Sainsbury's
and
Morrisons Wm Morrison Supermarkets trading as Morrisons, is the fourth largest chain of supermarkets in the United Kingdom, and is headquartered in Bradford Bradford is a city A city is a large human settlement.Goodall, B. (1987) ''The Penguin D ...

Morrisons
. In the 1950s, supermarkets frequently issued
trading stamp Trading stamps are small paper stamps given to customers by merchants in loyalty programs that predate the modern loyalty card. Like the similarly-issued retailer coupons, these stamps only had a minimal cash value of a few mils (thousandths of a d ...
s as incentives to customers. Today, most chains issue store-specific "membership cards", "club cards", or " loyalty cards". These typically enable the cardholder to receive special members-only discounts on certain items when the credit card-like device is scanned at check-out. Sales of selected data generated by club cards is becoming a significant revenue stream for some supermarkets. Traditional supermarkets in many countries face intense competition from
discounter A discount store or discounter offers a retail format in which products are sold at prices that are in principle lower than an actual or supposed "full retail price". Discounters rely on bulk purchasing and efficient Logistics, distribution to keep ...
s such as Wal-Mart,
Aldi Aldi (stylized as ALDI) is the common brand of two German family-owned discount supermarket Chain store, chains with over 10,000 stores in 20 countries and an estimated combined turnover of more than €50 billion. The chain was founded by brothe ...

Aldi
and
Lidl Lidl Stiftung & Co. KG (; ) is a German international discount retailer A discount store or discounter is a term that has been used over time and across different countries for a number of different retail formats, all of which sell products ...

Lidl
, which typically is non- union and operates with better buying power. Other competition exists from
warehouse clubs A warehouse club (or wholesale club) is a retailing, retail store, usually selling a wide variety of merchandising, merchandise, in which customers may buy large, wholesale quantities of the store's products, which makes these clubs attractive t ...
such as
Costco Costco Wholesale Corporation (Trade name, doing business as Costco Wholesale and also known simply as Costco) is an American multinational corporation which operates a chain of membership-only Big-box store, big-box retail stores (warehouse cl ...
that offer savings to customers buying in bulk quantities.
Superstores A big-box store (also hyperstore, supercenter, superstore, or megastore) is a physically large retail establishment, usually part of a chain store, chain of stores. The term sometimes also refers, by extension, to the company that operates the ...
, such as those operated by Wal-Mart and Asda, often offer a wide range of goods and services in addition to foods. In Australia, Aldi,
Woolworths Woolworth, Woolworth's, or Woolworths may refer to: Businesses * F. W. Woolworth Company, the original US-based chain of "five and dime" (5¢ and 10¢) stores * Woolworths Group, former operator of the Woolworths chain of shops in the UK, ceased ...
and Coles are the major players running the industry with fierce competition among all the three. The rising market share of Aldi has forced the other two to cut prices and increase their private label product ranges. The proliferation of such warehouse and superstores has contributed to the continuing disappearance of smaller, local grocery stores; increased dependence on the automobile; sub
urban sprawl Urban sprawl (also known as suburban sprawl or urban encroachment) is the unrestricted growth in many urban area An urban area, or built-up area, is a human settlement with a high population density and infrastructure of built environment. ...
because of the necessity for large floor space and increased vehicular traffic. For example, in 2009 51% of Wal-Mart's $251 billion domestic sales were recorded from grocery goods. Some critics consider the chains' common practice of selling loss leaders to be anti-competitive. They are also wary of the negotiating power that large, often multinationals have with suppliers around the world.


Online-only supermarkets (21st century)

During the
dot-com boom The dot-com bubble (also known as the dot-com boom, the tech bubble, and the Internet bubble) was a stock market bubble caused by excessive speculation of Internet-related companies in the late 1990s, a period of massive growth in the use and a ...
,
Webvan Webvan was a dot-com companyA dot-com company, or simply a dot-com (alternatively rendered dot.com, dot com, dotcom or .com), is a company that does most of its business on the Internet The Internet (Capitalization of Internet, or int ...

Webvan
, an online-only supermarket, was formed and went bankrupt after three years and was acquired by Amazon. The British online supermarket
Ocado Ocado Group is a technology-led, global, software and robotics platform business, with a strong retail heritage, which gives retailers including Kroger The Kroger Company, or simply Kroger, is an American retail company founded by Bernard Kr ...
, which uses a high degree of automation in its warehouses, was the first successful online-only supermarket. Ocado expanded into providing services to other supermarket firms such as
Waitrose Waitrose & Partners (formally Waitrose Limited) is a brand of British supermarkets, founded in 1904 as Waite, Rose & Taylor, later shortened to Waitrose. It was acquired in 1937 by employee-owned retailer John Lewis Partnership The John Lewis ...

Waitrose
and
Morrisons Wm Morrison Supermarkets trading as Morrisons, is the fourth largest chain of supermarkets in the United Kingdom, and is headquartered in Bradford Bradford is a city A city is a large human settlement.Goodall, B. (1987) ''The Penguin D ...

Morrisons
. Grocery stores such as Walmart employ food delivery services offered by third parties such as
DoorDash DoorDash Inc. operates an online food ordering and food delivery platform. It is based in San Francisco. With a 56% market share, it is the largest food delivery company in the United States. It also has a 60% market share in the convenience de ...
. Delivery robots are offered by various companies partnering with supermarkets. Micro-fulfillment centers (MFC) are relatively small warehouses with sophisticated automated rack-and-tote systems which prepare orders for pickup and delivery. Once the order is complete, the customer will pick it up (i.e. "click-and-collect") or have it fulfilled via home delivery. Supermarkets are investing in micro-fulfillment centers with the hope that automation can help reduce the costs of online commerce and ecommerce by shortening the distances from store to home and speeding up deliveries. In short, MFCs are said by many to be the key to profitably fulfilling online orders.


Types


U.S. categorization

The U.S. FMI food industry association, drawing on research by Willard Bishop, defines the following formats (store types) that sell groceries:


Organic and environmentally-friendly supermarkets

Some supermarkets are focusing on selling more (or even exclusively) organically certified produce. Others are trying to differentiate themselves by selling fewer (or no) products containing
palm oil Palm oil is an edible vegetable oil Vegetable oils, or vegetable fats, are oil An oil is any nonpolar chemical substance A chemical substance is a form of matter In classical physics and general chemistry, matter is any substa ...

palm oil
. This as the demand of palm oil is a main driver for the destruction of rainforests. As a response to the growing concern on the heavy use of petroleum-based plastics for
food packaging Food packaging is packaging Packaging is the science Science (from the Latin word ''scientia'', meaning "knowledge") is a systematic enterprise that Scientific method, builds and Taxonomy (general), organizes knowledge in the form of ...
, so-called "
zero waste Zero Waste is a set of principles focused on waste prevention that encourages the redesign of resource A resource is a source or supply from which a benefit is produced and that has some utility. Resources can broadly be classified upon their ...

zero waste
" and "plastic-free" supermarkets and groceries are on the rise.


Growth in developing countries

Beginning in the 1990s, the food sector in developing countries has rapidly transformed, particularly in Latin America, South-East Asia, India, China and South Africa. With growth, has come considerable competition and some amount of consolidation. The growth has been driven by increasing affluence and the rise of a middle class; the entry of women into the workforce; with a consequent incentive to seek out easy-to-prepare foods; the growth in the use of refrigerators, making it possible to shop weekly instead of daily; and the growth in car ownership, facilitating journeys to distant stores and purchases of large quantities of goods. The opportunities presented by this potential have encouraged several European companies to invest in these markets (mainly in Asia) and American companies to invest in Latin America and China. Local companies also entered the market. Initial development of supermarkets has now been followed by hypermarket growth. In addition there were investments by companies such as
Makro Makro is an international brand of warehouse club A warehouse club (or wholesale club) is a store, usually selling a wide variety of , in which customers may buy large, quantities of the store's products, which makes these clubs attra ...

Makro
and Metro Cash and Carry in large-scale Cash-and-Carry operations. While the growth in sales of processed foods in these countries has been much more rapid than the growth in fresh food sales, the imperative nature of supermarkets to achieve economies of scale in purchasing means that the expansion of supermarkets in these countries has important repercussions for small farmers, particularly those growing perishable crops. New supply chains have developed involving
cluster Consortium Linking Universities of Science and Technology for Education and Research (CLUSTER) is a collection of twelve Europe Europe is a continent A continent is one of several large landmasses. Generally identified by convention ...
formation; development of specialized wholesalers; leading farmers organizing supply, and farmer associations or cooperatives. In some cases supermarkets have organized their own procurement from small farmers; in others
wholesale markets The consumption and production of marketed food are spatially separated. Production is primarily in rural areas while consumption is in urban areas. Agricultural marketing is the process that overcomes this separation, allowing produce to be moved ...
have adapted to meet supermarket needs.


Typical supermarket merchandise

Larger supermarkets in North America and in Europe typically sell many items among many brands, sizes and varieties. U.S. publisher ''
Supermarket News A supermarket is a self-service Retail#Types of outlets, shop offering a wide variety of food, Drink, beverages and Household goods, household products, organized into sections. It is larger and has a wider selection than earlier grocery stores ...
'' lists the following categories, for example:
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Hypermarkets
have a larger range of non-food categories such as clothing, electronics, household decoration and appliances. *Bakery (packaged and sometimes a service bakery and/or onsite bakery) *Beverages (non-alcoholic packaged, sometimes also alcoholic if laws permit) *Nonfood & Pharmacy (e.g. cigarettes, lottery tickets and over-the-counter medications (as laws permit),
DVD The DVD (common abbreviation for Digital Video Disc or Digital Versatile Disc) is a digital Digital usually refers to something using digits, particularly binary digits. Technology and computing Hardware *Digital electronics Digital electr ...

DVD
rentals Renting, also known as hiring or letting, is an agreement where a payment is made for the temporary use of a good, service or property owned by another. A gross lease is when the Tenement (law), tenant pays a flat rental amount and the land ...
, books and magazines, including
supermarket tabloid Tabloid journalism is a popular style of largely sensationalist In journalism Journalism is the production and distribution of reports on current events based on facts and supported with proof or evidence. The word journalism applies to t ...
s, greeting cards, toys, small selection of home goods like light bulbs,
housewaresHousehold goods are goods In economics Economics () is the social science that studies how people interact with value; in particular, the Production (economics), production, distribution (economics), distribution, and Consumption (economic ...
(typically limited) *Personal care e.g. cosmetics, soap, shampoo *Produce (fresh fruits and vegetables) *Floral (flowers and plants) *Deli (sliced meats, cheeses, etc.) *Prepared Foods (packaged and frozen foods) *Meat (fresh packaged, frozen, sometimes with a butcher service counter) *Seafood (fresh packaged, frozen, sometimes with a butcher service counter) *Dairy (milk products and eggs) *Center store (e.g. detergent, paper products, household cleaning supplies) *Multicultural (ethnic foods) *Bulk dried foods *Animal foods, toys and products


Layout strategies

Most merchandise is already packaged when it arrives at the supermarket. Packages are placed on shelves, arranged in aisles and sections according to type of item. Some items, such as fresh produce, are stored in bins. Those requiring an intact
cold chain A cold chain is a temperature-controlled supply chain. An unbroken cold chain is an uninterrupted series of refrigerated production, storage and distribution activities, along with associated equipment and logistics, which maintain quality via a d ...
are in temperature-controlled display cases. While branding and store advertising will differ from company to company, the layout of a supermarket remains virtually unchanged. Although big companies spend time giving consumers a pleasant shopping experience, the design of a supermarket is directly connected to the in-store marketing that supermarkets must conduct to get shoppers to spend more money while there. Every aspect of the store is mapped out and attention is paid to color, wording and even surface texture. The overall layout of a supermarket is a visual merchandising project that plays a major role. Stores can creatively use a layout to alter customers' perceptions of the atmosphere. Alternatively, they can enhance the store's atmospherics through visual communications (signs and graphics), lighting, colors, and even scents. For example, to give a sense of the supermarket being healthy, fresh produce is deliberately located at the front of the store. In terms of bakery items, supermarkets usually dedicate 30 to 40 feet of store space to the bread aisle. Supermarkets are designed to "give each product section a sense of individual difference and this is evident in the design of what is called the anchor departments; fresh produce, dairy, delicatessen, meat and the bakery". Each section has different floor coverings, style, lighting and sometimes even individual services counters to allow shoppers to feel as if there are a number of markets within this one supermarket. Marketers use well-researched techniques to try to control purchasing behavior. The layout of a supermarket is considered by some to consist of a few rules of thumb and three layout principles. Aghazedah, S 2005, "Layout strategies for some of the operations", Management Research News, vol. 28, no. 10, pp. 31–46. Retrieved 8 May 2012, Business Source Complete, EBSCO host. The high-draw products are placed in separate areas of the store to keep drawing the consumer through the store. High impulse and high margin products are placed in the most predominant areas to grab attention. Power products are placed on both sides of the aisle to create increased product awareness, and end caps are used to receive a high exposure of a certain product whether on special, promotion or in a campaign, or a new line. The first principle of the layout is circulation. Circulation is created by arranging product so the supermarket can control the traffic flow of the consumer. Along with this path, there will be high-draw, high-impulse items that will influence the consumer to make purchases which they did not originally intend. Service areas such as restrooms are placed in a location which draws the consumer past certain products to create extra buys. Necessity items such as bread and milk are found at the rear of the store to increase the start of circulation. Cashiers' desks are placed in a position to promote circulation. In most supermarkets, the entrance will be on the right-hand side because some research suggests that consumers who travel in a counter-clockwise direction spend more. However, other researchers have argued that consumers moving in a clockwise direction can form better mental maps of the store leading to higher sales in turn. The second principle of the layout is coordination. Coordination is the organized arrangement of product that promotes sales. Products such as fast-selling and slow-selling lines are placed in strategic positions in aid of the overall sales plan. Managers sometimes place different items in fast-selling places to increase turnover or to promote a new line. The third principle is consumer convenience. The layout of a supermarket is designed to create a high degree of convenience to the consumer to make the shopping experience pleasant and increase customer spending. This is done through the character of merchandising and product placement. There are many different ideas and theories in relation to layout and how product layout can influence the purchases made. One theory suggests that certain products are placed together or near one another that are of a similar or complementary nature to increase the average customer spend.Bezawada, R Balachander, S Kannan, PK Venkatesh, S 2009, "Cross-Category Effects of Aisle and Display Placements: A Spatial Modeling Approach and Insights", ''Journal of Marketing'', vol. 73, no. 3, pp. 99–117, 3 May 2012, Business Source Complete. This strategy is used to create cross-category sales similarity. In other words, the toothpaste is next to or adjacent the toothbrushes and the tea and coffee are down the same aisle as the sweet biscuits. These products complement one another and placing them near is one-way marketers try to increase purchases. For vertical placement, cheap generic brands tend to be on the lowest shelves, products appealing to children are placed at the mid-thigh level, and the most profitable brands are placed at eye level. The fourth principle is the use of color psychology, and the locations of the food, similar to its use in fast food branding. Consumer psychologists suggest that most buyers tend to enter the store and shop to their right first. Some supermarkets, therefore, choose to place the entrance to the left-hand side as the consumer will likely turn right upon entry, and this allows the consumer to do a full anticlockwise circle around the store before returning to the checkouts. This suggests that supermarket marketers should use this theory to their advantage by placing their temporary displays of products on the right-hand side to entice you to make an unplanned purchase. Furthermore, aisle ends are extremely popular with product manufacturers, who pay top dollar to have their products located there. These aisle ends are used to lure customers into making a snap purchase and to also entice them to shop down the aisle. The most obvious place supermarket layout influences consumers are at the checkout. Small displays of chocolates, magazines, and drinks are located at each checkout to tempt shoppers while they wait to be served.


Criticisms

* The large scale of supermarkets, while often improving cost and efficiency for customers, can place significant economic pressure on suppliers and smaller shopkeepers. * Supermarkets often generate considerable food waste, although modern technologies such as biomethanation units may be able to process the waste into an economical source of energy. Also, Stock management#Software applications, purchases tracking may help as supermarkets then become better able to size their stock (of perishable goods), reducing food spoilage.


See also

* Hypermarket * List of grocers * Short food supply chains **Farmers' markets * Retail#Types of retail outlets, Types of retail outlets * Effects of the car on societies


References

"September 6, 1916: The first supermarket opens for business". Knappily.


Further reading

* * Petroski, Henry (November–December 2005)
"Shopping by Design"
''American Scientist'' 93 (6): 491. * Thomas Sowell, Sowell, Thomas. ''Basic Economics'' (Third Edition, 2007 Basic Books). Pages 92–94 describe the competition between the dominant grocery chains in the United States through the 20th century and beyond.


External links


Food Stories
– Explore a century of revolutionary change in UK food culture on the British Library's Food Stories website
groceteria.com
– supermarket history and architecture from the 1920s to the 1970s
Scrambling for customers
4 August 2005, San Francisco Chronicle {{Authority control American inventions Food retailing Supermarkets,