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How bringing local groceries online empowers communities

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It’s hard to understate just how massive the shift to online grocery shopping has been for consumers and retailers alike. In August of 2019, total e-grocery sales were just over $1 billion dollars—a notable sum, at the time.

Contrast that with June 2020, when total sales hit $7.2 billion, a seven-fold increase that’s only predicted to grow once the numbers for July and August become available. In short, the online grocery store isn’t just open for business—for many, it’s now the preferred option.

Yet the competitive playing field is uneven. Local businesses often lack the technical expertise to compete in an online environment they’ve only recently entered.

Moreover, the rapid pace of technological change means that companies that do come up with a solution can’t keep up with the ongoing maintenance and support requirements.

All of this has allowed larger companies, who with larger budgets can effectively outsource the entire process, to gain an advantage over their smaller competitors.

While smaller and locally-owned grocery stores are thriving for now, they’re at risk of losing sales due to their larger counterparts.

Luckily, ecommerce solutions keep local grocery stores serving their communities and empower them to take charge of their own growth.

Here’s how.

A Shifting Landscape

The grocery industry was a late-comer to ecommerce. Major shifts only started to occur in 2017, when Amazon announced its $13.4 billion deal to acquire the supermarket chain Whole Foods.

In their press release, Amazon highlighted its commitment to making “natural and organic food affordable for everyone,” and with the expanded rollout of Amazon Fresh that same year, the company was able to take even greater control of the e-grocery market.

All of this meant heightened competition against locally-owned grocery stores, yet when Instacart, UberEats, PostMates, and others entered the scene, small businesses had a new problem to contend with—by way of a purported solution.

Platforms that provide the ecommerce and delivery components to grocery stores offer a quick solution for online ordering, but by now, store owners have learned that this comes at a cost. Third-party order collection and delivery fees can effectively eat up the grocery store’s profits.

A wrong choice can have adverse impact.

The losses aren’t only financial. One of the major strengths small businesses have is their ability to connect with the local community.

Small grocery stores are often passed down through generations, operating as the hub of community interactions and, particularly now, a vital source of food and supplies. That connection is often lost in the shift to online—unless the company has the tools to nurture close relationships.

Your Local Store Online

Customers are changing their shopping patterns, particularly with the shift to mobile ordering creating new channels for grocery store owners.

Having a fast, user-friendly app in iOS and Android helps companies both market their products and increase orders. The key is that the app must be native—simply having a webstore available in-browser does not bring the speed necessary to turn a first-time customer into a return buyer.

With an app in place, the next challenge any independent grocery store faces is the product database.

Having every product inventoried online with quality images, descriptions, and nutritional information is a challenge for grocery store employees who must focus their time on day-to-day operations and in-store customer satisfaction.

Providing small businesses with cost-effective tools that do this is now a possibility, as are new options for what small groceries want most: better marketing. When grocery stores go online, they’re well aware they’re competing against a swath of larger companies with broad advertising campaigns.

Meanwhile, the local grocery’s greatest asset is its local impact on the community, along with earned trust and respect. Marketing to both the people who also shop in-store along with a wider audience is critical.

Bringing the competitive strength of independent groceries into the online realm requires rethinking the way we, as customers, expect grocery delivery to function.

There’s no loss to convenience when ordering local—in fact, the more small groceries that go online, the greater the likelihood of fast delivery to homes and offices.

As for the price, giving the groceries the tools to create their own online experience—through apps, storefronts, and analytics—puts the money in the pockets of the independent grocery and its employees.

The Independent Grocer’s Future

Every community is different, and that uniqueness is always represented in the local grocery store, from the employees manning the checkout counters to the products set out on display.

Keeping that uniqueness alive online means giving small businesses the right tools to develop their own one-of-a-kind virtual presence.

The technology that gets local grocery stores there is in place—now, it’s about deciding the best path forward for each individual business, based on their time-tested knowledge of how their community lives, shops, and thrives for the future.

Disclosure: This story is brought to you through an ESPACIO portfolio company

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Bagrat Safaryan
Bagrat Safaryan is the CEO and Co-Founder of end-to-end grocery ecommerce platform LocalExpress. He is a serial entrepreneur with a focus on technology startups. He has extensive prior experience in corporate finance and advisory and several C level roles at cross-border technology, financial and industrial enterprises.