Why Grocery Retail Teams Need This New 5-Year Sales Forecast

The grocery landscape is constantly evolving, and staying ahead of the curve is crucial for any executive in the industry. Our new report, the U.S. Grocery Sales 5-Year Forecast: 2025-29, offers invaluable insights and perspective that grocery retail teams should consider as they look to strengthen their own business.

This forecast projects continued shifts in how consumers will shop for groceries, both in-store and online, over the next five years. Here are the key takeaways.

The Shifting Tides of Grocery Spending

While overall grocery spending growth is expected to slow, the online segment (aka eGrocery) is poised for stronger growth. The report projects that eGrocery will increase at a compound annual growth rate (CAGR) of 8.9%, which is more than five times faster than the 1.7% rate anticipated for in-store sales.

• The report projects that eGrocery will increase at a compound annual growth rate (CAGR) of 8.9%, which is more than five times faster than the 1.7% rate anticipated for in-store sales.
• By the end of 2029, online sales, encompassing Pickup, Delivery, and Ship-to-Home, are expected to account for 17% of all U.S. grocery sales.

While overall grocery spending growth is expected to slow, the online segment (aka eGrocery) is poised for stronger growth. The report projects that eGrocery will increase at a compound annual growth rate (CAGR) of 8.9%, which is more than five times faster than the 1.7% rate anticipated for in-store sales.

The surge is a continuation of trends first observed in 2024, where promotion-fueled growth in the second half of the year drove annual eGrocery sales up by just over 9% compared to 2023. This momentum is expected to continue through most of 2025, with Delivery leading much of the year-over-year growth.

Beyond the Topline Numbers: Critical Factors to Consider

Grocery retail executives need to look beyond the topline forecast numbers for the following two reasons.

1. Mass retailers and Walmart (excluding Sam's Club) currently hold significant shares of the eGrocery market, accounting for nearly 50% and 40% of sales, respectively.
2. The overall forecast includes Ship-to-Home, a service not offered by most grocers. This underscores the importance of leveraging the national forecast as a guide to examining regional trade areas, competitive sets, household demographics, and growth opportunities.

Potential "Gray Swans" on the Horizon

The forecast also calls out critical external factors that could significantly impact shopping behaviors. These "gray swans" introduce uncertainty and highlight the need for being nimble.

• Immigration: A more restrictive immigration policy by the current administration is identified as a factor contributing to the projected slowdown in sales growth. A similar approach in the past led to a 9% CAGR decrease in immigration for three years (excluding 2020), which, if repeated, could result in a 54-basis point drag on the 5-year eGrocery sales CAGR.
• Trade Policy and Inflation: Changes in trade policy, such as tariffs, can cause rapid and significant shifts in buying behaviors due to higher prices. While political uncertainty makes precise predictions difficult, the forecast anticipates grocery-related inflation to range between 2.7% and 1.2% through 2029, covering a wide array of products from Food at Home to Personal Care Products.
• SNAP Changes: Pending legislation related to Supplemental Nutrition Assistance Programs (SNAP) at both federal and state levels could reduce overall payments, make it harder to qualify for assistance, or restrict eligible products. With approximately 17% of U.S. households receiving SNAP benefits as of January 2025, any reductions would likely trigger further changes in consumer purchasing habits.

Intel for Adapting to an Evolving Business

Grocery retail has always been a dynamic business, but the rate of change over the last five plus years has disrupted shopping patterns, especially for Delivery and value formats, like Walmart, and that disruption is not disappearing anytime soon. In addition, the motivation behind eGrocery adoption has also evolved: from saving time before the pandemic, to protecting health during it, and now often a combination of saving money and time.

The U.S. Grocery Sales 5-Year Forecast: 2025-29 is an annual initiative that provides a comprehensive projection of grocery sales, broken down by in-store and online, and further by service methods like Pickup, Delivery, and Ship-to-Home. This forecast is built on a proprietary model that integrates Brick Meets Click's own research, supplemented with data from various government agencies.

For grocery retail teams looking to better understand the eGrocery ecosystem, learn about potential risks, and capitalize on growth opportunities in an increasingly complex market, this Forecast is an essential tool. Reach out to me at david.bishop@brickmeetsclick.com to see about special deals/offers just for retailers.

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