Grocery store technology It hasn’t changed much in decades, so when the pandemic hit it served as a wake-up call for the industry, highlighting its flaws, especially when it comes to e-commerce. Grocery stores that don’t adapt will lose market share.
The good news for the grocery industry is that technological advances in recent years, particularly in the field of computer vision, are giving startups a head start on e-commerce-like grocery stores in brick-and-mortar locations.
And venture capital is here for it. Investors say computer vision, along with friction-free checkout and inventory management tools, are revolutionizing the grocery industry and will ultimately impact the retail business at large.
Expanding equity capital and footprints.
Grocery tech is attracting VC activity for a few reasons: For one, grocery retail is a huge market — a $1 trillion industry poised to grow 3% over the next eight years, according to Grandview Research.
Before the pandemic, 3% of that trillion dollars came from online sales. That has now grown to 8%, said Elaine Russell, principal at Greycroft and co-head of Albertsons Fund, a $50 million fund launched by Greycroft and the grocery chain in 2018 to invest in the future of retail and next-generation retailers.
Another example is that e-commerce’s share of the grocery market is expected to be between 10% and 20% by 2025, Russell told TechCrunch.
“This kind of change in the hundreds of billions of dollars will shake up the entire industry and shine a light on the glaring holes and issues that large retailers need to fix,” she added. “Change brings innovation and opportunity, and grocery is a good challenge, by the way, for the industry, because many of the technologies used in grocery can be applied to other retailers as well.”