IGD’s 2031 UK grocery forecasts show the market is entering a prolonged period of structurally weak demand despite continued headline growth, as underlying consumption fails to recover.
The market is expected to grow by more than £45bn by 2031, reaching £303.7bn in value, but this expansion will be driven primarily by inflation and population growth rather than a significant increase in demand.
“There will not be a meaningful recovery in underlying demand over the next five years,” said Senior Insight Analyst Alex Rowberry.
“Ongoing economic pressure, lasting changes in shopper behaviour, and emerging factors, such as GLP-1s, are all acting to limit how much people buy. We expect that GLP-1 adoption alone will offset £11.2bn of market growth.”
Shopper behaviour shifts
Growth is expected to become increasingly uneven over the forecast period, as online and discount channels benefit from sustained shifts in shopper behaviour and capture a disproportionate share of future gains.
Online will be the fastest-growing channel, with a CAGR of 5.6 per cent, while discount will grow at 3.6 per cent, as both align more closely to how shoppers are choosing to buy.
These gains are rooted in long-term changes in how people shop, including a continued move towards smaller baskets, more frequent trips, and value-led decision-making. These behaviours are reinforcing demand for convenience and low prices, while placing pressure on more traditional formats.
“What’s changing is that retailers can no longer rely on a growing market to drive performance. With demand remaining structurally weak, growth increasingly depends on being positioned in the channels and missions where spend is shifting,” said Rowberry.
Supermarkets grow but lose share
Supermarkets will remain the largest channel and contribute the most to overall growth, adding £17.9bn over the forecast period, but will lose share to faster-growing competitors. IGD says large store formats will be particularly affected, with hypermarkets continuing to underperform.
In a significant shift, discount is forecast to close the gap with convenience – the UK’s second-largest grocery channel – driven by faster growth of 3.6 per cent CAGR versus 2.5 per cent. This will see discount’s value reach £52.9bn compared with convenience’s £54.7bn, underlining the strength of value-led formats in a constrained consumer environment.
Policy and health are also expected to play an increasing role, with the combined impact of HFSS regulation and changing health behaviours shaping category mix, purchasing patterns and long-term consumption levels.
While all channels will continue to grow in value terms, some will face additional pressure from these shifts. This includes convenience, which will grow but gradually cede share as it is impacted by declining tobacco and vape sales and wider regulatory change.
IGD concludes that the UK grocery market is transitioning from an inflation-led recovery into a more stable, lower-growth phase.