Online food shopping will remain most successful format

The research and training charity, which provides information and best practice to the global food and grocery industry, predicts a stabilisation of sales at larger stores over the next five years, following a challenging few years.

Online will remain the fastest-growing format, growing by 68 per cent, followed by the discounters.

By 2021, discounters will be worth £24.9bn, said IGD, although growth will be more measured than previously.

Convenience will remain the third fastest-growing sector, yet will also see a slowdown in expansion.

Joanne Denney-Finch, IGD chief executive, said: “It has been a challenging time for food and grocery retailers, with an extremely competitive market dampened by unprecedented food and drink deflation. Yet we believe there will be a modest recovery across food and grocery over the next five years, as inflation picks up and shoppers start to benefit from the investments that retailers are making in their stores and ranges.”

Online growth will be driven by the rise in click and collect services and new players entering the online grocery arena.

Meanwhile, IGD forecasts that by 2021, £1 in every £8 will be spent at a discounter, up from £1 in £10 this year. However, it is forecasting their growth to slow over the next five years.