WASHINGTON REPORT
Independents in California are a Powerful Economic Engine G R EG F ER R A R A PR E S IDE N T AN D CEO N AT ION AL GR OCER S AS S OCIATIO N
When talking about an independent community grocer, entrepreneurship is its foremost quality. Anyone familiar with the independent supermarket industry knows in their gut that local retailers are a driving force in the U.S. economy. Millions of people across the U.S. rely on their local independent for quality products at an affordable price. However, while we all know this to be true, it helps to have the data to back it up, whether it’s used to show lawmakers at the state and federal level the pivotal role independents have in the U.S. economy, or so that operators can use the data to adjust their business strategy. That is why NGA commissioned John Dunham & Associates to conduct an economic impact study to demonstrate the strength of independent operators in the grocery industry. The results were not surprising: Independents are at the heart of the U.S. economy, supporting more than 1 million jobs and generating billions in wages nationally. Updating the study NGA last conducted in 2012, the results showed independent grocers’ sales rose from $131 billion when the study was last conducted to $253.6 billion in 2020. This means that even in a world with more and more big-box stores, consumers still find value in their local independent grocery store.
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But what about in California, where there are 2,701 independent grocery stores? The study revealed that independent grocers: • Account of 1.2% of the state’s GDP
Some key takeaways from the study: • Overall, independent grocers contribute more than $255 billion to the economy, or about 1.2% of the U.S. GDP
• Generate $15.1 billion in wages • Are responsible for 274,600 of the Golden State’s total jobs • Have a total economic impact of 38.1 billion • Contribute $3.2 billion in federal tax and $3.1 billion in state tax revenues
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• Independents are responsible for 1.1 million jobs earning wages approaching $39 billion • They generate federal, state and local tax revenues surpassing $36 billion • Their sales account for 33% of total U.S. grocery sales, up from 25% a decade ago
Much like the data nationally, independent grocers in California are a driving force in the economy. Even with all the challenges faced during the Covid-19 pandemic – increased demand, government regulations and a labor shortage – independent grocers have persevered, innovating whenever necessary to continue serving their communities. The study also found e-commerce has driven sales as independent grocers have invested more in their online shopping platforms, which gave independents an edge during the pandemic of the past year-plus. Online grocery sales grew 54% in 2020 to nearly $96 billion, driving it to a 12% share of total U.S. e-commerce sales and 7.4% of all grocery sales (Insider Intelligence, emarketer.com/ content/2021-online-grocery-sales-willsurpass-100-billion)
