The National Grocers Association (NGA) is out with its annual Independent Grocers Financial Survey, conducted with FMS Solutions Holdings, showing that “independent grocers’ same store sales were down 0.6 percent compared to the previous year. Despite the decline, it is an improvement over last year’s results, which showed a 1.62 percent decrease in same store sales.”

The survey goes on: “Despite a growing number of competitive formats, independent grocers’ margins were slightly ahead of where they were a year ago. Additionally, 71% of the respondents indicated that they are more optimistic about their business’ future.”

One explanation: “In fiscal year 2017, food at home price deflation continued to be a drain on sales. Average food at home prices were 0.2 percent lower than they were a year prior according to the Bureau of Labor Statistics. Deflation was especially drastic toward the beginning of the year, however by December, monthly food at home prices began to show improvement.”

“There’s no doubt that the supermarket industry is changing at a rapid pace,” says Peter Larkin, president/CEO of NGA. “However, independent grocers have faced industry shifts and challenges in the past and have proven resilient. They are the entrepreneurs of the industry, and have the ability to experiment and adjust as needed to meet their shoppers’ needs.”

KC's View: Seems appropriate here to refer you back to something Tom Furphy said in today’s Innovation Conversation…

Stores whose value proposition is solely to serve as inventory access-points for shoppers are going to be increasingly challenged by stores that provide deeper value. Shoppers have access to large, personalized assortments online. Having their purchases delivered to their homes or staged for pickup eliminates the mundane tasks of shopping. This opens up time for the shopper to spend on richer experiences and it enables stores to be used increasingly in value-added ways. Discovery, information and sensory experiences will become even more important. Stores that deliver on this will not go away.

What was resilient in the past may be insufficient in the present. Independent retailers - especially those that may be undercapitalized, because being small and independent can have its drawbacks - have to be not just experimental, but also ambitious, aggressive and innovative in finding new paths to relevance and resonance.