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Market and trends

Digitalization, demographic changes and a heightened focus on sustainability and price value are examples of trends that affect society and our industry. Our ability to understand how these trends affect us and translate them into a long-term strategy and concrete priorities enables us to meet customers’ changing needs.

The food retail trade in Sweden is a mature market in which Axfood is the second largest player – a position that has strengthened in recent years. The competition is fierce and has grown in recent years with the emergence of discount stores, the establishment of e-commerce, and the increase in Swedes who eat out more.

Demographic changes

  • High population growth
  • Aging population
  • Income gaps are widening
  • Greater diversity
  • Continued high pace of urbanization affecting both cities and the countryside

Population growth in Sweden has been significant for a number of years. According to Statistics Sweden’s forecast, Sweden’s population will increase to more than 11 million by 2030. The share of people born outside of the country will increase to around 22%. Population growth is expected to be strongest in the major cities. Meanwhile, the share of elderly is growing at the same time that the share of people of working age is decreasing. These factors affect what, when and how food is bought and eaten.

Competition and price value

  • Continued growing competition from traditional retailers, but also from new actors
  • Discount trend remains strong
  • Large, global actors creating ecosystems, and Swedish actors building retail ecosystems with food as a base
  • Innovative, small actors seeking partnerships with larger, traditional companies

With digitalization comes greater price transparency, making it easy for customers to compare. Axfood’s customers are generally very price conscious. According to Axfood’s brand survey, “value for money” is most important after “quality”. At the same time it is not only price that determines what customers perceive as value for money. Aspects such as helpful service, attractive peripheral services and a high-quality assortment are key factors in what customers experience as offering price value. To bring down prices for customers, retailers are relying on private labels and large purchasing organizations.

Sector convergence

  • Sector convergence is increasing, especially in major cities
  • Focus on culinary spaces and meal solutions
  • New distribution channels opening up for meal solutions

The distinction between sectors is being erased as many companies offer products and services that traditionally are not part of their core businesses. Groceries are being sold to a greater extent at restaurants, convenience stores and other retail venues. Cafés and pharmacies are sharing premises with grocery stores, and also selling grocery items. Since the turn of the millennium, the share of household expenses that go to groceries has been at around 12%. With rising incomes, a lower share is expected to be spent on groceries. The share of household expenses spent at cafés and restaurants is expected to rise.

Health and sustainability

  • Growing concerns about climate change
  • Awareness of the impact of food on the climate and health is rising, especially among young people
  • Consumers more prepared to compromise in order to reduce their carbon footprint
  • Sustainable global food consumption is putting high demands on changes in consumption and food production

Issues such as responsibility, environmental impact and health are becoming increasingly important, and conscious consumers are manifesting their lifestyles through active food choices. Environmentally adapted packaging, reduced food waste, food in season, ethical aspects and country of origin are becoming increasingly important considerations. Many customers want more information about products’ country of origin, quality and ingredients to live healthier lives.


  • Continued high growth in e-commerce, which is gaining ground in food retail
  • Customers who shop online are looking primarily for time savings and convenience
  • Large retailers are investing heavily in e-commerce, and growth in the market is being driven by the traditional actors
  • The business model is challenging, especially for pure-pay online retailers and for home delivery

Digitalization is making an impact in all areas of food retail, from purchasing, logistics, ways of working and marketing to the customer meeting. This means more automation and efficiency, but also a greater need for employee competence development. E-commerce is growing fast, and more people are shopping online. A key factor for the growth in e-commerce is that younger consumers are more digitally literate and shop more online than older ones. According to the Swedish Trade Federation, online food retail is expected to grow from today’s share of approximately two percent to a share of between 6%-11% by 2025. Changed shopping behaviours are opening up for new business models and businesses.