The 10 largest supermarket chains in the world operate across several continents and have thousands of locations, both under their corporate names and under other names.
As some predict the inevitable demise of brick-and-mortar stores, supermarkets will likely remain stalwarts of retail that are unlikely to close. Even though online shopping is growing at a fast pace and more and more people opt for home delivery of their groceries, supermarkets will still be around due to their proximity to customers, allowing them to get fresh food whenever they want. Many customers also want to check the quality of the products they’re paying good money for, so they will still buy at least some of their groceries at local supermarkets as opposed to taking their chances with delivery of fruit, veggies, or meat. In this way, the future of supermarkets will be dependent on their performance through both the online and offline mediums.
Since supermarkets are consumer staples companies, they are less sensitive to economic cycles and are expected to do well in any economic environment because people will always need to buy food and other items that they require day-to-day, as opposed to stuff like gadgets and cars. Hence, supermarket companies usually represent good long-term investments.
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Alongside housing and transportation, food accounts for one of the largest chunks of the average household’s budget. The US Department of Agriculture estimates that a family of two spends approximately $380 to $760 per month on food alone and that sum goes higher for a family with children. Since households are most likely to spend money at the nearest supermarkets, companies have been aggressively investing in expansion both domestically and internationally. Worldwide food retail sales amount to around $4 trillion annually and the market is dominated by a few large companies that control more than 30% of that figure.
As supermarket chains grow bigger, it means that they have more power over their suppliers and can more easily control their prices. In addition, some supermarket chains, like Wal-Mart Stores Inc (NYSE:WMT) in the U.S and Tesco in the UK, are among their nations’ largest employers, which in turn gives them the power to influence the political and social landscape.
However, as stated earlier, in order to succeed, supermarket chains need to embrace the phenomenon of online shopping and they have to do it fast, as the industry has already started to go through some major changes. Recently, Amazon.com, Inc. (NASDAQ:AMZN) announced the acquisition of Whole Foods Market, Inc. (NASDAQ:WFM) for $14 billion. The move will allow the largest e-commerce retailer to enter the grocery segment, without the need to purchase real estate locations and build its own network, but rather expand on Whole Foods’.
Now then, let’s take a closer look at the 10 largest supermarket chains in the world in terms of the number of locations. As stated earlier, these companies dominate the market and due to their size, they benefit from the cost advantages due to technology and economies of scale, compared to smaller retailers. Check out the list beginning on the next page.
If you’re looking for a different perspective on grocers, be sure to also check out the 11 Largest Grocery Chains By Revenue in America.
