Indie Grocers Boosted Gross Margins, Bottom Lines in 2008: Survey

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Indie Grocers Boosted Gross Margins, Bottom Lines in 2008: Survey

This year’s Independent Grocers Survey from the National Grocers Association (NGA) and FMS Solutions showed a 4.31 percent increase in same store sales over last year, prior to adjustments for CPI Food at Home. Additionally, breaking a three-year negative streak, respondents across all categories turned a higher net profit before taxes. Overall store margins experienced a solid increase, reporting 26.94 percent in 2008 vs. 25.55 percent in 2007.

The average square footage decreased from last year’s respondents from 28,617 to 25,469, and the total inventory in the store rose to $658,454, bringing the total inventory per square foot to $13, a $3.35 increase per square foot over last year. Of the total square footage in respondents’ stores, 84.4 percent of the space is actually selling square footage -- a significant increase from last year’s 76.5 percent.

The survey also included the top seven issues chosen by members of Arlington, Va.-based NGA, which this year were health care reform (one of the biggest retailer issues over the past decade), energy costs, the economic stimulus plan, supercenter legislation, (permanent repeal of) death tax, immigration reform and international policies.

Health care costs increased by an average 7.98 percent in 2008; last year’s respondents had expected an 8.36 percent increase. This year’s respondents are expecting an 11.18 percent increase in 2009. The average cost of health care reported in the current survey was $6,581.23 per employee.

An overwhelming 85.3 percent of respondents also said this year that the Obama administration would implement change that would adversely affect employers’ bottom lines.

The 2009 Independent Grocers Survey is a financial and operational review of the independent retail grocery industry. Retailers of all sizes and formats took part in the survey. Baltimore-based FMS provides independent retail grocers and supermarkets with financial information.