Italy will witness a 2.6% decline in sales in supermarkets in 2021, while discount stores look set to buck the trend, a new report from the Coop cooperative and Nomisma has revealed.
The study surveyed managers of the major companies in the Italian food sector.
Italy ended 2020 with a 4.2% increase in sales across the large-scale retail distribution channel.
During Christmas week, sales grew by 8%, as the COVID-19 pandemic resulted in further closures of the HoReCa channel, boosting in-home consumption.
Last year, the worsening economic situation contributed to the growth of discount stores (+9.1%), self-service (+5.8%) and e-commerce (+140%) channels, while hypermarkets saw a sales decline of 2.8% year-on-year.
Other Predictions
Southern Italy looks set experience more difficulties, according to the study, while losses in the northern regions will be less pronounced, partly due to the strong growth of e-commerce (+62% according to Nielsen estimates) in those areas.
E-commerce represents a significant dilemma for operators in the food supply chain, the study noted.
A majority (60%) of respondents see the growth of online as a threat, as they believe it will 'cannibalise' the physical store network and add further costs to the sector's already precarious financial situation.
For the remaining 40%, it represents an opportunity to provide better services to consumers.
Economic Crisis
Other challenges in 2021 include the threat of a looming economic crisis, once the COVID-19 pandemic subsides, and its consequent impact on demand.
Around 27% of the respondents expect a drop in food and FMCG purchases, the study found.
The 'slow cooking' trend will continue, with Italians continuing to spend less, buying more basic ingredients and fewer ready-made dishes, while focusing on quality and wholesomeness.
Purchases will be more focused on food produced with Italian (+53%) and natural or sustainable raw materials (+48%), as well as fresh ingredients (+52%) poised to see the most growth.
© 2021 European Supermarket Magazine – your source for the latest retail news. Article by Branislav Pekic. Click subscribe to sign up to ESM: The European Supermarket Magazine.
