MULTICHANNEL 2022 Report 2018

The Swedish market for groceries 2022 Multichannel 2022 forecasts the development of the market for groceries in Sweden up to year 2022. The report also describes the historic development of the same market from the year 2000 to 2016. The definition of the market for groceries in the report includes all grocery channels (restaurants are for example included). The market development from the year 2000 to 2016 shows that groceries’ share of total household consumption expenditures increased from 23% in the year 2000 to just over 26% in 2016. The grocery trade (named grocery stores in the report) is the largest channel, but its channel share has decreased from 64% in year 2000 to 57% in 2016. The restaurant channel has on the other hand increased its share from 19% in year 2000 to 25% in 2016. Pharmacies and discount department stores have registered the highest increase of their channel share during the same period. The forecasted market development up to year 2022 is based on information from a number of official sources such as: KI, SCB, HUI, Visita and on information from expert interviews with senior leaders and experts in the grocery industry. The total market for groceries is forecasted to grow 3.4% per year to 623,5 Billion SEK (incl. VAT) in the year 2022. The total household consumption is however forecasted to grow 4,1% annually in the same period, which means that groceries share of total household consumption will decrease slightly to 25,2%. The grocery channels are expected to develop differently. As an example, restaurants are expected to continue increasing their channel share, mostly driven by higher price increases than other channels. Pharmacies and discount department stores are also expected to continue increasing their channel share while grocery stores are expected to see their channel share drop further. Next page summarizes the forecasted development for each channel up to the year 2022.

The Swedish market for groceries from the year 2000 to 2022 Annual growth 2000-2016 Growth 2015-2016 Year 2022 Annual growth 2016-2022 Grocery Channels (Billion SEK incl. VAT) T.O. Channel Share Current Prices Grocery stores (incl. Service trade) 166,4 64,2% 282,3 57,7% 290,2 57,1% 3,5% 2,8% 342,5 54,9% Restaurants 50,1 19,3% 118,9 24,3% 126,7 24,9% 6,0% 6,6% 168,0 26,9% 4,8% Discount department stores 1,8 0,7% 6,0 1,2% 6,3 8,0% 3,9% 8,0 1,3% 4,2% Pharmacies 3,8 1,5% 11,7 2,4% 12,6 2,5% 7,8% 7,6% 17,5 5,6% Liquor monopoly 21,5 8,3% 34,6 7,1% 35,6 7,0% 3,2% 3,0% 42,5 6,8% Specialty retailers 9,2 19,9 4,1% 20,8 5,3% 4,9% 26,0 3,8% Food specialists 6,5 16,2 3,3% 16,5 1,6% 19,0 Total groceries 259,2 100,0% 489,6 508,7 4,3% 623,5 3,4% Household consumption expenditures 1115,0   1889,1 1949,8 3,6% 2475,4 Total groceries share of above 23,2% 25,9% 26,1% 25,2% The total market for groceries grew from 259,2 Billion SEK in the year 2000 to 508,7 Billion SEK in 2016. The market for groceries is forecasted to be worth 623,5 Billion SEK in 2022. This means that groceries share of total household consumption expenditures decreases slightly from 26,1% in the year 2016 to 25,2% in 2022. The grocery trade channel is expected to see its share drop from 64% in the year 2000 to 55% in 2022. The restaurant channel is expected to increase its shares from 19% to 27% during the same period.

Sources and method A combination of quantitative and qualitative sources Marketing Clinic has been assigned by DLF to produce the report Multichannel 2022. The historical information are based on different sources of information, all of which have been selected and validated by Marketing Clinic’s experts. The forecast is based on quantitative information from a number of official agencies (KI, SCB, HUI) and from interviews with senior leaders and experts in the grocery industry. Marketing Clinic’s experts have summarized all the information and calculated the forecast for the year 2022. Historical turnover The historical turnover are in current prices includes VAT. Marketing Clinic has selected the different sources used to measure the turnover in different channels. The aim has been to achieve the best possible estimate. Expert interviews Marketing Clinic has conducted around 20 interviews with senior leaders and experts in the grocery industry. The interviews have been analyzed and validated by Marketing Clinic. Forecast year 2022 The forecast is based on information from a number of official agencies (KI, SCB, HUI) and from interviews with senior leaders and experts in the grocery industry. Marketing Clinic’s experts have summarized all information and calculated the forecast for year 2022.