E-commerce could end era of expansive supermarkets

Tuesday, March 6, 2012 - 10:47 by Mike Price

The days of the hypermarket and the megastore could well be numbered, according to a report published by the Guardian.

A number of pieces of evidence from the retail sector suggest that the popularity of safe shopping online and the pressure which it is putting on the high street will result in fewer large supermarkets being opened and a more focused, compact set of shops replacing them.

This is in part based on the news that Tesco has seen its market share slip to levels previously recorded seven years ago, indicating that its expansion strategy of drastically increased store sizes is no longer effective.

While the behemoths of the high street wowed visitors with the size of their outlets back in 2005, the proliferation of web technology and the increasing flexibility of online shopping, means many people do not favour the bricks and mortar experience when there is a far easier alternative available.

Retail experts now predict that we could see an upper limit of 70,000 sq ft on any new supermarket which is opened. This is because many of the items which might have been placed within will actually experience better sales if they are offered via safe shopping online, where the market is far broader.

While the high street offers convenience and reliability due to its immediacy, it cannot match the web when it comes to giving out product information and e-commerce is catching up fast in these other areas.

Of course the inevitable waning of the dominance of real world outlets extends beyond supermarkets. Half of all physical film media sold is bought online, which has seen many major retailers that previously relied on this sector either hybridise their approach and join the web revolution, or disappear from the high street altogether.