This report provides a comprehensive analysis of the US grocery market to identify optimal locations for new store openings based on foot traffic patterns, demographic trends, and competitive dynamics. Our findings indicate how businesses in the grocery retail store chains can find the most optimal and profitable location for their next retail store.
This comprehensive analysis provides grocery retailers with a data-driven framework to identify optimal locations that maximize foot traffic, align with favorable demographics, and strategically position against competitors.
Key Findings:
- There is a strong correlation between foot traffic and grocery retail success.
- Areas with high pedestrian movement (urban centers, commercial malls) generate higher grocery cart revenues.
- The average in-store shopper spends 23.4 minutes per visit.
- Family dynamics significantly impact purchasing behavior, with larger households (5+ members) spending nearly twice as much ($262) as two-person households ($143).
- Multicultural grocery markets are valued at approximately $50 billion. Strategic
- Competitor density emerges as a nuanced factor in location selection.
- Areas with lower competitor saturation can yield more market share.
- 61% of shoppers prefer mainstream grocery chains like Target, Walmart, and Costco.
Location Analysis for Grocery Stores Expansion
The US Grocery Retail Market, valued at over $900 billion in 2025, is projected to grow at 3.7% annually.
Whether you want to find the most suitable grocery store location in Florida or in North Dakota, this research report explains how analyzing foot traffic, demographics, and competitor density can ease the task of finding the location.
Grocery retail’s success depends largely on the location of the store. While competitive pressure in the industry is extremely high, there are some grocery retail players who are managing to stay highly profitable by adopting some best business practices and strategies. One of them is aligning their location with consistent foot traffic areas and choosing a location for their store where competitive pressure is minimal.
The right location can provide:
- Consistent customer traffic
- Higher basket sizes
- Stronger community integration
- Lower marketing costs
- Sustainable competitive advantage
Also, studying the demographics closely is a strategy that never fails in retail. Choosing a location where people love to shop in-store (brick and mortar stores) works in favor of the retailers.
Even when e-commerce sales are rising, even today 80-85% of grocery sales happen via retail stores.
As grocery retail is still a thriving business, a multi-dimensional analysis before choosing a location for a grocery store is a prudent decision. Any successful expansion of grocery stores must align with consumer demand and competitive positioning, and therefore, foot traffic analysis and demographics analysis are key for identifying consumer demand trends. Similarly, analysis of competitor stores is key to meet competitive positioning objectives.
1. Foot Traffic Analysis
Foot traffic analysis provides a direct glance into the area’s viability for grocery retail. Mobile device tracking and computer vision tech installed in the areas can help provide data regarding foot traffic, peak hours of shopping, consumer influx, and shopping patterns. Combined with heat mapping technologies, businesses can also find barriers to entry or potential traffic issues in the area.
Foot traffic analysis provides essential insights into consumer behavior, helping grocery retailers choose locations where customer visits are frequent and consistent. Foot traffic analysis also highlights barriers such as poor parking or difficult accessibility. Preliminary foot traffic analysis can help retailers avoid costly investment mistakes.
Foot traffic data is often directly proportional to sales volumes.
Grocery stores located in high foot traffic areas such as urban centers, commercial districts, or near transit hubs tend to benefit from spontaneous consumer visits. This convenience factor encourages frequent, smaller purchases.
Furthermore, foot traffic data also provides financial projection into sales if a new location is chosen for retail store establishment. Analyzing historical foot traffic trends alongside predictive analytics is the best way to select locations that promise sustainable growth of your grocery business.
- Grocery stores located in areas with high pedestrian traffic experience up to 20% higher sales than less trafficked locations (Statista, 2024).
- In 2024, Kroger was the store with the most foot traffic in the USA.
- 72% of grocery shoppers frequent stores located near their homes or workplaces (Retail Dive, 2024).
- 74% of grocery shoppers still visit physical stores.
- Grocery stores near transit hubs experience an increase in spontaneous purchases compared to suburban locations.
- Grocery store foot traffic rose to nearly 17.2 billion visits in 2024.
- Grocery store locations with optimal foot traffic achieve lower customer acquisition costs.
- In-store grocery shoppers spent an average of 23.4 minutes in 2024.
Foot Traffic Analysis of Major Grocery Store Chains in the USA
| Grocery Chain | Avg. Foot Traffic (Million/Month) | % Shoppers <1 Mile | Avg. Basket Size ($) | Avg. Store Size (sq ft) | % With Public Transit Access | Est. Market Share (%) |
| Walmart | 165.2 | 73% | $58 | 180,000 | 41% | 25.2 |
| Kroger | 110.7 | 69% | $49 | 95,000 | 38% | 10.8 |
| Costco | 56.4 | 61% | $130 | 145,000 | 28% | 8.2 |
| Target | 115 | 70% | $174 | 135,000 | 38% | 14.7 |
| Albertsons | 47.9 | 65% | $44 | 67,000 | 34% | 5.7 |
| Whole Foods | 14.7 | 59% | $59 | 46,000 | 46% | 2.3 |
2. Demographic Analysis
Demographics analysis finds out about the income groups that are key shoppers. For instance, extremely busy professionals generally order groceries online. Family size distribution, disposable business income, and multi-generational households also affect grocery store analysis.
Other demographic analysis factors for grocery retail include:
- Income stability (percentage of salaried vs. gig economy workers)
- Percentage of households with children
- Single-person households
- Ethnic diversity
- Senior populations
- Gen Z consumers
- lifestyles and values
- Health and wellness orientation
- Environmental consciousness
- Cooking vs. convenience preferences
Demographic analysis is also crucial for grocery retailers to align their shoppers’ interests, preferences, budget, and behaviors with their locations and offerings. For instance, a particular demographic of shoppers may not be willing to move beyond a mile to reach a grocery store, and your competitor’s store is within a mile, and you’re at 1.2 miles. This may create a huge barrier for you. Thoroughly analyzing shopper preferences based on their demographics data can help avoid such mistakes.
Family dynamics are another major demographic factor to consider in choosing grocery store locations. Areas with larger household sizes have higher grocery consumption, and this increases chances of your success.
Demographics related to lifestyle preferences and generational traits also impact store success. Younger consumers, especially Gen Z, increasingly prioritize online shopping over retail visits. If you can provide home delivery in a vicinity, then it can be a solution to getting market share with GenZ customers in dominance.
- The multicultural grocery market is estimated at $50 billion. A major portion of grocery sales growth is driven by multicultural and ethnically diverse households.
- Household size of 5+ had $262 average grocery spend compared to that of $143 for household size of 2.
3. Competitor Density Analysis
The US grocery industry is fiercely competitive. Without analysis of locations of various other grocery chains, you can rarely find the sweet location spot for your store. You need to analyze the current locations of your direct competitors who share the same format as yours.
For example, Walmart and Target have identical grocery store formats, and therefore, they are direct competitors. Walmart vs. Target store locations analysis will be necessary for competitor density analysis if either of these two wants to expand their store. You also need to analyze indirect competitors that have different formats but may sell the same grocery items as yours. Also, understanding e-commerce penetration is important. In areas where e-commerce is not easily available, you have less competition from this online rival.
In areas where there are more competitors or grocery stores than the foot traffic, there will be extreme margin pressure, market share dearth due to saturation. However, even in areas with no or little competition, one should be cautious as it may indicate insufficient demand.
Key Competitive Density Metrics
- Stores per capita ratio
- Square footage of grocery retail per household
- Market share distribution among existing competitors
- Average distance between similar format stores
- Parking capacity ratio (parking spots per store square footage)
- Product category overlap percentage with nearby competitors
For instance, understanding the proximity and performance of large-scale competitors like Walmart, Target, or Kroger allows businesses to anticipate market challenges and adjust their competitive strategies accordingly. Indirect competitors, including convenience stores and specialized markets, also impact grocery retail success. Locations where convenience stores dominate may indicate consumer preference for quick shopping trips.
- 61% of grocery shoppers prefer a mainstream grocery chain like Target, Costco, or Walmart.
- Stores with low competitor density enjoy an average market share increase of 15% compared to stores in highly saturated markets.
- Grocery store visits increased 0.9% in Q1 2025 compared to Q1 2024.
- 63% of shoppers choose stores based on proximity to their home or workplace, making location analysis crucial for grocery retailers.
- Retailers using location analytics see up to a 34% improvement in location strategy returns, highlighting the value of data-driven decision-making.
Grocery stores are changing. While online shopping grows, physical stores are still important. Smart store owners use data to find the best locations. The best spots can work as both regular stores and delivery centers for online orders.
Conclusion
This gives customers more options. If you are a retail store business, a grocery chain, or grocer with multiple locations looking to expand further, then location analysis is needed to find out the most suitable and premium location for your next store. This location analysis is powered by datasets about foot traffic, demographics, and competitor density.
At LocationsCloud, we provide retail grocery stores location datasets to assist you in your location analysis endeavor.
