Independent grocers see sharp sales gains through online delivery and marketplace platform Mercato

12-Feb-2019 - Last updated on 12-Feb-2019 at 17:15 GMT

Independent grocers using the online ordering and delivery marketplace, Mercato, have experienced strong year-over-year sales increases despite growing competition from national chains and larger online grocery delivery providers.

Mercato analyzed year-over-year and fourth quarter 2018 sales for retailers on the Mercato.com platform and found that sales increases ranged from 45% to 400%.

Examples include natural grocer LifeThyme Natural Market, with a 380% year-over-year increase and 320% growth in Q418 over Q417 in online sales. For New York City-based wholesale seafood provider, The Lobster Place, online sales increased 275% Q418 over Q417, and British-themed grocery store Myers of Keswick in Manhattan registered online sales growth of 130% in Q418 compared to Q417.

"Mercato complements the in-store experience for shoppers – we ensure the stores maintain their brand, oversee their own order fulfillment and leverage our vast delivery network for everything from staples to special ingredients,” said Mercato co-founder and CEO Bobby Brannigan.

Mercato offers its merchants the option to use its national courier network or manage their own deliveries, and also works with independent grocers to create a unique online shopping experience for shoppers to use.

Mom-and-pop store battle for market share

It's not easy out there for independent and specialty retailers who have to go head to head with national retailers that have access to more resources and distribution. By store count, the market share of independent retailers declined 41% across US counties between 2005 and 2015, according to a USDA report. The report also found that independent grocery stores generated roughly $70bn in sales in 2015 representing an 11% share of all US grocery sales, down from about 14% in 2007.

To take some of the headache out of devising an online grocery strategy, Mercato provides its more than 650 merchants with the option to use its national courier network or manage their own deliveries, and also works with independent grocers to create a unique online shopping experience for shoppers to use.

Jason Bander, owner of LifeThyme Natural Food Market in New York City and a Mercato merchant said, "Mercato is helping us to compete with bigger chains opening stores in our community by increasing our reach to shoppers who prefer carefully curated local products and produce and who otherwise would not be able to come into the store."

In addition, consumers are becoming increasingly familiar and comfortable with ordering groceries online. According to Forrester Research, online grocery sales are expected to double over the next four years, reaching $334bn by 2022.

Higher spending per order is also driving growth of online grocery shopping. A 2018 Brick Meets Click study found that online shoppers have increased their weekly online spending from 28% to 46% of their total grocery spend, with an average order size increase from $62 in 2017 to $69 in 2018. By comparison, the average Mercato weekly average ranges from about $74 to $85 per order.

“Merchants should continue to see increases of online sales as shoppers learn how easy it is to get home delivery of their groceries within about an hour with Mercato,” said Brannigan.