Grocery Stores Turned Everything We Know About Fast Food On Its Head

Fast food and casual dining restaurants face increasing competition from an unlikely source: Supermarkets are moving beyond groceries and doubling as restaurants. Welcome to the age of the "grocerant," where the line between shopping and dining is becoming deliciously blurred.

While grocery store cafeterias have been around for decades, large chains like Costco, Whole Foods, Wegmans, and Kroger are upping their food service game to a level that competes with casual quick-service restaurants serving pizza, burgers, salads, and even grocery store sushi. One benefit to the grocerant is convenience. Imagine meeting a friend for a coffee or lunch, then filling your family's prescriptions and doing your weekly grocery shopping — all without leaving the building. 

The grocerant experience also makes a supermarket more competitive. "The grocerant game is something that almost every retailer with larger stores should be playing," Diana Sheehan of marketing research firm Incontext Solutions told CNN. In 2022, 25% of consumers bought more prepared food meals from grocery stores compared to 2021, according to a report by The Food Industry Association.

Younger consumers want a nice meal at a good price

Ghost kitchens, or off-site spaces utilized by a supermarket, make it easier for grocery stores without full commercial kitchens to offer delicious and convenient restaurant-style food. While ghost kitchens are a force throughout the food service industry, from restaurant overflow to delivery, they fit especially well in the retail environment. For example, Kitchen United is the nationwide ghost kitchen service that prepares Kroger's in-store pick-up and take-out meals.

Grocerants were trending before the COVID-19 pandemic, but tasty and affordable meals prepared by grocery stores have become particularly appealing to younger consumers like millennials, since there's usually a wide array of healthy options at an affordable price. And the expansion of app-based ordering and delivery services could make grocerants even more alluring.

Grocery chain Wegman's toppled Trader Joe's as the top grocery store in 2016, according to a Market Force Information survey (per CNBC). One factor may be Wegman's popular dine-in restaurants serving burgers, sushi, salads, and more, which Trader Joe's lacks. But it's not just Wegman's — Costco's food court is a popular fast food restaurant itself, while Whole Foods' prepared foods and bakery offerings are the hot ticket for a coffee date or an outing with friends.