Food Retail Market Size, Share, Growth, Report 2025 to 2034

Food Retail Market Size and Growth 2025 to 2034

The global food retail market size was reached at USD 12.49 trillion in 2024 and is expected to be worth around USD 22.54 trillion by 2034, exhibiting at a compound annual growth rate (CAGR) of 6.08% over the forecast period 2025 to 2034.

The food retail industry has been experiencing steady growth, driven by changing consumer lifestyles, urbanization, and technological advancements. With increasing demand for convenience, online grocery platforms have expanded rapidly, allowing consumers to shop from home with doorstep delivery. The shift towards healthier food choices, including organic and plant-based products, has also contributed to the industry’s transformation. Additionally, the integration of digital payment solutions, AI-based inventory management, and smart retail technologies has improved efficiency in food retail operations.

Sustainability and eco-friendly practices are also influencing market growth. Retailers are adopting biodegradable packaging, reducing food waste, and supporting local sourcing to meet consumer demand for ethical and environmentally responsible products. The expansion of supermarkets and hypermarkets in developing regions further fuels industry growth, providing consumers with a wider variety of products at competitive prices. The future of food retail is expected to be shaped by automation, data-driven marketing, and personalized shopping experiences.

What is Food Retail?

Food retail refers to the process of selling food and grocery products to consumers through various distribution channels, such as supermarkets, convenience stores, and online platforms. It includes both perishable items like fruits, vegetables, dairy, and meat, as well as non-perishable goods like packaged snacks, beverages, and cooking essentials. Food retailers ensure that consumers have easy access to fresh, processed, and packaged food products for daily consumption.

The food retail industry operates through multiple formats, including hypermarkets, supermarkets, grocery stores, and online marketplaces. Large retail chains like Walmart, Carrefour, and Tesco dominate the market, while local convenience stores and specialty food shops also play a crucial role. In recent years, online grocery shopping has gained popularity due to convenience, digital payment options, and home delivery services. The industry continuously evolves with changing consumer preferences, focusing on organic, healthy, and sustainable food choices.

Food Retail Market Report Highlights

• The Asia-Pacific has held dominant position, accounted for revenue share of 36.5% in 2024.
• Europe has reported revenue share of 25.5% in 2024.
• By product type, the food segment has captured revenue share of 62.7% in 2024.
• By category, the packed segment is expected to witness notable growth over the forecast period.
• By distribution channel, the physical stores segment has garnered revenue share of 59.8% in 2024.

Food Retail Market Recent Trends

• Emphasis on Sustainability and Ethical Practices: Consumers are increasingly prioritizing sustainability and ethical sourcing in their purchasing decisions. Retailers are responding by implementing measures to reduce food and packaging waste. For instance, Tesco has committed to halving its food waste and ensuring all its own-brand packaging is fully recyclable by the end of 2025. Since 2019, Tesco has reduced over 5,900 tonnes of packaging and has introduced collection points for soft plastics, amassing over 2,000 tonnes for recycling. Additionally, Tesco collaborates with organizations like FareShare and Olio to redistribute surplus food, aiming to redistribute 85% of unsold food by 2025. 
• Rise of Plant-Based and Alternative Proteins: The demand for plant-based and alternative proteins is growing as consumers seek healthier and more sustainable diets. The global plant-based food market is projected to reach USD 200 billion by 2034, growing at a compound annual growth rate (CAGR) of 12% from 2025 to 2034. This growth is attributed to factors such as increasing consumer awareness of health and environmental benefits, as well as higher levels of venture investments in plant-based food companies. 
• Technology-Driven Shopping Experiences: Advancements in technology are reshaping the food retail landscape. Retailers are investing in online infrastructure, automating stores and warehouses, and enhancing online pickup and delivery services. For instance, Walmart has significantly increased its online revenue, now generating 18% of its total revenue from e-commerce, and is expected to report record revenue of USD 681 billion.
• Health and Wellness Focus: Health-conscious consumers are driving demand for products that align with specific dietary needs and wellness goals. The global nutraceuticals market, for example, was valued at USD 658.33 billion in 2024 and is expected to grow at a CAGR of 7.42% from 2024 to 2033, reaching USD 1,254.19 billion by 2033. This growth is driven by increasing awareness about the benefits of a vegan diet and rising concerns about animal health and cruelty.
• Omnichannel Retailing: The integration of online and offline shopping experiences is becoming essential. Retailers are creating seamless transitions between in-store and digital platforms, utilizing data analytics for personalized marketing, and developing loyalty programs that reward purchases across all channels. This approach meets consumer expectations for a cohesive shopping experience and is crucial for maintaining competitiveness in the market.

Report Scope

Food Retail Market Dynamics

Market Drivers

Consumer Demand for Convenience

• Modern consumers increasingly prioritize convenience in their shopping experiences. A recent research survey indicates that 52% of consumers value convenience more now than in the past. This shift has prompted retailers to enhance online grocery services, offer ready-to-eat meals, and streamline in-store experiences. Notably, 84% of grocers acknowledge that competing on convenience is crucial for increasing sales volume. 

Health and Wellness Trends

• There's a growing consumer focus on health and wellness, influencing purchasing behaviors towards healthier food options. For instance, 66% of consumers are willing to pay a premium for fresh food, with an average willingness to pay 22% more for fresh over alternatives like canned or frozen options. Retailers are responding by increasing the availability of organic, natural, and minimally processed foods to meet this demand. 

Market Restraints

Supply Chain Disruptions

• The food retail industry is susceptible to supply chain disruptions from factors such as natural disasters, labor shortages, and geopolitical tensions. These disruptions can lead to product shortages and increased operational costs. For example, during the COVID-19 pandemic, a significant number of consumers experienced shortages of certain food products, highlighting the vulnerability of supply chains.

Low Profit Margins

• Food retailers often operate with thin profit margins due to intense competition and high operational costs. Expenses related to inventory management, logistics, and compliance with food safety regulations can further strain profitability. Retailers must focus on cost-cutting measures and operational efficiency to maintain financial health.

Market Opportunities

E-Commerce Integration

• The integration of e-commerce platforms offers significant growth opportunities for food retailers. The global online food delivery market is experiencing rapid growth, driven by increasing consumer preference for online shopping and home delivery services. Retailers investing in robust online platforms and logistics can tap into this expanding market segment.

Expansion into Emerging Markets

• Emerging markets present vast potential for growth due to increasing urbanization and rising disposable incomes. For instance, the Asia-Pacific region is witnessing a surge in demand for packaged foods and international brands. Retailers expanding into these markets can capitalize on the evolving consumer preferences and growing middle-class population.

Market Challenges

Regulatory Compliance

• Navigating the complex landscape of food safety regulations and labeling requirements across different regions poses challenges for retailers. Non-compliance can result in financial penalties and damage to brand reputation. For example, in the European Union, non-compliance with food safety regulations can lead to substantial fines, emphasizing the importance of adherence to regulatory standards.

Intense Competition

• The food retail market is highly competitive, with both established players and new entrants striving for market share. This competition can lead to price wars, further squeezing profit margins. Retailers must differentiate themselves through unique product offerings, superior customer service, and strategic partnerships to maintain a competitive edge.

Food Retail Market Segmental Analysis

The food retail market is segmented into product type, category, distribution channel and region. Based on product, the market is classified into food and grocery. Based on category, the market is classified into packed and unpacked. Based on distribution channel, the market is classified into physical store and online stores.

Product Type Analysis

Food: The food segment remains the backbone of the food retail industry, covering fresh produce, dairy, meat, seafood, and packaged food products. Growing consumer demand for healthier and organic food options is influencing purchasing patterns. The increasing availability of ready-to-eat meals, plant-based products, and gluten-free alternatives has significantly expanded this segment. Supermarkets and online grocery platforms are playing a key role in increasing consumer access to diverse food options, including specialty and international cuisines. The demand for functional foods fortified with vitamins and nutrients is also rising, as consumers prioritize well-being and immunity-boosting products.

Food Retail Market Revenue Share, By Product Type, 2024 (%)

Grocery: Grocery products, including essential staples such as grains, pulses, cooking oils, dairy products, and beverages, are witnessing steady demand. Changing lifestyle patterns, coupled with increasing urbanization, have driven a shift toward packaged grocery items with extended shelf life. The expansion of private-label grocery brands by major retailers has further fueled market competition. Consumers are increasingly seeking sustainable grocery options, such as organic and non-GMO products, as environmental awareness grows. Digital grocery shopping trends have also enhanced the segment, as subscription-based grocery delivery services become more common.

Category Analysis

Packed: Packed food products, including frozen foods, processed meats, dairy products, snacks, and confectionery, have gained significant traction due to convenience and extended shelf life. Consumers prefer pre-packaged and easy-to-cook meals to accommodate their fast-paced lifestyles. Food safety and hygiene concerns have also increased the appeal of packed foods, as they offer controlled packaging and labeling with detailed nutritional information. The rise of sustainable and eco-friendly packaging options, such as biodegradable wraps and reusable containers, is further transforming the segment. Supermarkets and hypermarkets dominate the sales of packed food products, with online grocery platforms emerging as strong competitors.

Unpacked: Unpacked food includes fresh produce, bulk grains, and dairy products sold in open markets or minimal packaging formats. This segment remains essential for consumers who prioritize freshness and affordability. Farmers’ markets, local grocery stores, and specialty organic retailers play a crucial role in providing unpacked food items. Consumers seeking preservative-free and locally sourced food favor this segment. Additionally, rising awareness of plastic waste and food sustainability has encouraged some consumers to opt for bulk purchases and reusable packaging. However, the segment faces challenges related to storage, food wastage, and shorter shelf life compared to packed alternatives.

Distribution Channel Analysis

Physical Stores: The Physical Stores dominated the market in 2024. Supermarkets, hypermarkets, and local grocery stores continue to dominate food retail, as many consumers prefer an in-person shopping experience where they can inspect products before purchasing. Supermarkets offer a wide variety of fresh and packaged food items, competitive pricing, and loyalty programs that keep customers engaged. Hypermarkets, with their large-scale operations, provide discounts and bulk purchase options, making them popular for household grocery shopping. The presence of physical stores also enhances trust and convenience for consumers who prefer immediate purchases without delivery wait times. In addition, physical stores frequently incorporate in-store promotions, tasting counters, and seasonal discounts, which contribute to strong consumer retention.

Food Retail Market Share, By Distribution Channel, 2024 (%)

Online Stores: The rapid expansion of digital grocery shopping has reshaped the food retail landscape. Consumers increasingly prefer online grocery platforms for their convenience, variety, and doorstep delivery options. E-commerce platforms allow users to compare prices, access exclusive discounts, and schedule deliveries at their convenience. The emergence of AI-driven recommendations and personalized shopping experiences has enhanced customer engagement. Subscription-based grocery delivery services and meal kits have also gained popularity, providing curated food selections tailored to dietary preferences. Online food retailers are leveraging advanced logistics, warehouse automation, and partnerships with local vendors to ensure fresh and timely deliveries.

Food Retail Market Regional Analysis

The food retail market is segmented into various regions, including North America, Europe, Asia-Pacific, and LAMEA. Here is a brief overview of each region:

Asia-Pacific: Dominating the Food Retail Market

The Asia-Pacific food retail market size was valued at USD 4.56 trillion in 2024 and is expected to reach around USD 8.23 trillion by 2034. Asia-Pacific holding the largest market share in 2024. The region’s dominance is driven by China, India, and Japan, where rising urbanization, increasing disposable incomes, and evolving consumer preferences fuel market expansion. The rapid growth of supermarkets, hypermarkets, and online grocery platforms has further strengthened the food retail sector in APAC. The increasing adoption of digital payment solutions and e-commerce platforms has accelerated online grocery sales, making APAC the most dynamic market for food retail. Additionally, the region’s strong agricultural base and expanding processed food industry contribute to sustained growth. The demand for organic, functional, and convenience foods is also on the rise, driving product innovation and distribution expansion.

North America: Mature and Innovative Food Retail Market

The North America food retail market size was estimated at USD 2.87 trillion in 2024 and is forecasted to hit around USD 5.17 trillion by 2034. North America holds a significant market share in the food retail industry, driven by the U.S. and Canada. The region’s market strength is attributed to its well-established supermarket chains, advanced supply chain infrastructure, and high consumer spending on premium and organic food products. The demand for ready-to-eat meals, frozen foods, and plant-based alternatives is rising, fueled by changing lifestyle preferences and increasing health consciousness. E-commerce grocery platforms such as Amazon Fresh and Walmart+ are reshaping the industry, offering personalized shopping experiences and seamless delivery services. Additionally, sustainability initiatives such as zero-waste grocery stores and eco-friendly packaging are gaining traction in North America.

Europe: A Stable and Growing Market

The Europe food retail market size was reached at USD 3.18 trillion in 2024 and is projected to surpass around USD 5.74 trillion by 2034. Europe maintains a strong position in the food retail market, driven by Germany, France, and the U.K. The region’s food retail sector benefits from well-established supermarket chains, stringent food safety regulations, and a growing consumer preference for organic, gluten-free, and plant-based foods. The demand for sustainable and locally sourced products is increasing, leading to a rise in specialty food stores and farm-to-table retail models. Additionally, the presence of discount grocery chains such as Lidl and Aldi has intensified price competition, making food retail highly competitive. The European market is also witnessing significant investment in digital grocery solutions, including AI-driven personalized shopping experiences and rapid delivery services.

LAMEA (Latin America, Middle East & Africa): Emerging Food Retail Market

The LAMEA food retail market was reached at USD 1.88 trillion in 2024 and is anticipated to reach around USD 3.39 trillion by 2034. LAMEA represents an emerging market in the global food retail industry, with steady growth potential. Countries like Brazil, Mexico, Saudi Arabia, and South Africa are experiencing increased investments in supermarket infrastructure and digital grocery platforms. The rise of modern retail formats such as hypermarkets and convenience stores is transforming the region’s traditional food retail landscape. Additionally, the increasing adoption of mobile-based grocery shopping and digital payments is enhancing accessibility and affordability. Governments across LAMEA are also focusing on improving food security and supply chain efficiency, which is expected to support the long-term expansion of the food retail sector in this region.

Food Retail Market Top Companies

• Walmart Inc.
• The Kroger Co.
• Amazon.com, Inc. (Amazon Fresh, Whole Foods)
• Tesco PLC
• Carrefour S.A.
• Aldi Group
• Costco Wholesale Corporation
• Ahold Delhaize
• Target Corporation
• Metro AG
• Seven & i Holdings Co., Ltd. (7-Eleven)
• Lidl Stiftung & Co. KG

The food retail market is highly competitive, dominated by global giants like Walmart, Amazon, and Tesco, alongside regional players catering to specific markets. These companies leverage advanced supply chain management, omnichannel retailing, and private label offerings to strengthen their market presence. E-commerce and digital transformation have reshaped the industry, with online grocery sales growing significantly, driven by consumer demand for convenience. Supermarkets, hypermarkets, and discount retailers continue to hold a major share, while organic and sustainable product lines are gaining traction. Strategic mergers, acquisitions, and partnerships play a crucial role in market expansion, enabling companies to tap into emerging markets and diversify product portfolios.

Recent Developments

• In January 2025, Greggs, a prominent British food retailer, announced plans to expand its store network after opening a record number of new shops in 2024. The company is also investing in supply chain capacity to support this growth. However, it reported a decline in its year-on-year cash position and experienced slowed sales growth in the latter half of 2024, reflecting broader economic challenges.
• In December 2024, Pop Up Grocer, founded by CEO Emily Schildt, opened a permanent location in New York's West Village. This innovative grocery store aims to transform shopping into an aspirational experience, featuring high-end and unique food brands that appeal to younger generations. The company plans further expansion, potentially targeting markets like Los Angeles.
• In January 2025, U.S. fast-food chain Chick-fil-A announced its entry into the UK market, with plans to open sites in Belfast, Leeds, Liverpool, and London. This move is part of a broader trend of U.S. fast-food brands expanding into the UK.
• In October 2024, Whole Foods Market, owned by Amazon, enhanced its omnichannel grocery shopping experience by offering in-store pickup for online orders and personalized deals for Amazon Prime members, reflecting a broader trend towards integrated retail solutions.
• In October 2024, Tesco implemented a combination of traditional stores, dark stores, and automated micro-fulfillment centers to support both online and offline shopping, aiming to provide a seamless omnichannel experience for customers.

Market Segmentation

By Product Type

• Food
• Grocery

By Category

• Packed
• Unpacked

By Distribution Channel

• Physical Store
  • Supermarkets
  • Hypermarket
  • Warehouse Stores
  • Connivence Stores
  • Others
• Online Stores

By Region

• North America
• APAC
• Europe
• LAMEA