Food and Grocery in International Retail: A Blueprint for India

Walk into the headquarters of any global retail giant and you will find the same quiet truth driving the business: people need to eat, and they need to eat every single day. Food and grocery is the largest category in retail worldwide, and it is the engine that built the biggest store chains on the planet. The international retail story did not grow in a vacuum. It evolved through decades of economic shifts, supply-chain innovation, and changing consumer habits, and it now serves as a useful map for where organised retail in India is heading. Let us unpack why food and grocery sits at the centre of global retail, what Walmart, Tesco, and Carrefour did to dominate it, and what all of this means for the Indian market.

Why food and grocery dominates global retail 🔗

The logic is simple but powerful. Groceries are high-frequency, low-margin, repeat purchases. A customer might buy a television once in five years, but they buy milk, vegetables, atta, and cooking oil every week. That frequency turns a grocery store into a footfall machine. Once a shopper is inside for daily essentials, retailers can sell them higher-margin items like apparel, electronics, and home goods on the same trip.

This is why food and grocery forms the single biggest slice of sales for nearly every major chain. In the United States and Europe, grocery is not a side category; it is the backbone of the entire operation. The global food and grocery retail market was valued at roughly USD 11.9 trillion in 2023, with the Asia Pacific region accounting for the largest share. No other retail category comes close to this scale.

Lessons from the world’s biggest grocers 🔗

Three names appear again and again when people study modern retail: Walmart, Tesco, and Carrefour. Each grew enormous on the back of food and grocery, but each took a different road to get there.

Walmart and the everyday low price model 🔗

Walmart, the world’s largest retailer, is the clearest example of grocery muscle. For the financial year ending January 2024, its US business reported grocery sales of around USD 264 billion out of roughly USD 442 billion in total US sales, according to the company’s annual filing with the US Securities and Exchange Commission. That means grocery alone makes up close to 60% of its domestic sales. Walmart’s strategy rests on everyday low prices, achieved through ruthless supply-chain efficiency, massive purchasing power, and tight inventory control. The company has also extended this dominance online, capturing about 37% of US online grocery sales in mid-2024, driven largely by its pickup and delivery network.

Tesco and the power of customer data 🔗

Tesco, the largest grocer in the United Kingdom, took a different path. While it also competes hard on price and range, its real edge came from understanding the customer. Its Clubcard loyalty programme, with tens of millions of members, turned everyday shopping data into a strategic asset. Tesco learned what shoppers bought, when, and in what combination, then used that insight to stock shelves, design promotions, and develop private-label products. For Tesco, food and grocery is not just the bulk of sales; it is the source of the data that powers the rest of the business.

Carrefour and the hypermarket format 🔗

Carrefour, the French chain, effectively pioneered the hypermarket, a single large store that sells groceries and general merchandise under one roof. This format is built around the grocery trip. By pulling customers in for food, Carrefour could sell them everything from clothing to kitchenware in the same visit. The company spread this model across Europe, Latin America, and Asia, and built strong private-label ranges spanning budget to premium tiers. Its hypermarket blueprint directly influenced the large-format stores that later appeared in India.

The common playbook behind the giants 🔗

Strip away the differences and a shared strategy emerges. These chains succeeded because grocery gave them three things that smaller players could not easily match.

Supply chain control. Selling perishables at scale forces a retailer to master logistics, cold chains, and inventory turnover. Once that machine is built, it becomes a competitive moat that is hard to copy.

Private labels. Because customers visit so often, retailers can build trust in their own brands. Private-label products improve margins and give the chain pricing power against suppliers.

Footfall and cross-selling. Grocery brings shoppers through the door repeatedly. Each visit is a chance to sell higher-margin categories, which is why so many of these chains evolved into hypermarkets and supercentres rather than staying pure supermarkets.

The food and grocery scenario in India 🔗

India follows the same fundamental pattern, with a scale all its own. Food and grocery is already the largest single category of household spending, accounting for roughly half of what an average family spends. That makes it the most important battleground in retail. The opportunity is enormous: the Indian food and grocery retail market was valued at about USD 719 billion in 2023, one of the biggest in the world.

What sets India apart is who controls that market. For decades, the sector has been dominated by kirana stores and neighbourhood shops rather than organised chains. Modern retail still represents only a modest slice of total food and grocery sales, with the organised segment historically valued at a small percentage of the overall business. The vast majority of grocery shopping still happens at the corner shop, the local mandi, and the wet market.

From early pioneers to today’s leaders 🔗

Organised grocery retail in India was built by value-based formats that borrowed heavily from the global hypermarket playbook. Early movers like Big Bazaar, Giant, and Spencer’s introduced Indian shoppers to the idea of buying a month’s groceries under one large, air-conditioned roof at competitive prices. They proved that the hypermarket model could work in Indian conditions.

The market has since reshaped around a new set of leaders. Chains such as DMart, built on a strict low-cost and value pricing approach reminiscent of Walmart, and large players like Reliance Retail have scaled aggressively, while Spencer’s and others continue to operate. The Future Group’s Big Bazaar, once a category leader, ran into financial trouble and largely exited the scene, a reminder that scale alone does not guarantee survival in a thin-margin business. The chains thriving today are the ones that mastered supply chains and cost control, exactly the disciplines that made the global giants successful.

What is fuelling the next wave of growth 🔗

Several forces are pushing organised food and grocery toward faster growth. Rising disposable incomes are giving households more to spend and more reasons to shop modern formats. Urbanisation and busier lifestyles are nudging consumers toward the convenience of supermarkets and apps. Crucially, retail expansion is no longer limited to metros. The fastest consumer growth is now coming from Tier-II and Tier-III cities, which are adding tens of millions of new organised-retail shoppers.

India is also leapfrogging in ways the older Western chains never did. Quick-commerce platforms are delivering groceries in minutes, and the government-backed Open Network for Digital Commerce is bringing small kirana stores online. Overall, India’s retail sector is projected to exceed USD 2 trillion by 2030, with organised retail expected to capture more than a third of the market. Food and grocery will sit at the heart of that expansion.

What the global playbook teaches the Indian market 🔗

The lessons from Walmart, Tesco, and Carrefour translate clearly. Win on grocery first, because it builds the frequency and trust that everything else depends on. Invest early in supply chains and cold storage, since perishables reward operational discipline. Use customer data and private labels to protect margins in a low-margin category. And design store formats, whether a physical hypermarket or a delivery app, around the regular grocery trip.

The key difference is context. India must adapt these strategies to a market where the kirana store is a trusted institution, not a relic to be wiped out. The most likely future is not the replacement of traditional retail but a blend of it with modern formats, digital ordering, and efficient logistics. The chains that respect this balance are the ones positioned to lead the next decade.

What do you think? If food and grocery is the foundation of every great retailer, why has organised retail in India taken so much longer to capture this category than it did in the US or Europe? And as quick commerce and kirana digitisation grow side by side, do you believe India will follow the Western hypermarket path, or build a model entirely its own?

References

1. https://www.grandviewresearch.com/industry-analysis/food-grocery-retail-market
2. https://www.sec.gov/Archives/edgar/data/0000104169/000010416924000056/Financial_Report.xlsx
3. https://www.digitalcommerce360.com/2024/08/07/us-online-grocery-sales-q2-2024/
4. https://www.fas.usda.gov/data/india-retail-foods-2
5. https://www.ibef.org/industry/retail-india