How to Run an Online Grocery Store

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February 29, 2024

A grocery store is one of the safest businesses in the retail industry. Whereas electronics quickly become obsolete and clothes drop out of fashion, there will always be a demand for fresh food.

During the ecommerce boom brought about by the 2020 pandemic, online grocery was one of the strongest-performing sectors. From August 2019 to March 2020, monthly online grocery sales in the US surged by 233%, growing from $1.2 billion to $4 billion.

Though the fear of COVID-19 has passed, the gains made by online groceries have only continued to increase. For those considering a new venture or entrepreneurs who already own a brick-and-mortar store, an online venture is certainly a sound business decision.

Read on to learn how to run an online grocery store, and turn it into a thriving endeavor.

Things to consider before starting an online grocery store

Before diving into an online grocery store business, take the time to plan out a detailed strategy. It’s already a very crowded market, so having a reliable plan and fallbacks beforehand will improve your chances of success.

Target market

Are you catering to budget-conscious shoppers or indulgent consumers who splurge on higher-end, imported items?

Your inventory and marketing strategies should be designed to cater to the kind of customers you want to attract.

Delivery logistics

Ensuring your customers receive their orders with no delay is the most critical part of running an online grocery store. Setting up your order fulfillment processes and last-mile delivery methods, either in-house or through a third-party logistics (3PL) partner, is crucial.

Answer the following questions when planning out order fulfillment:

  • Will you be providing hyper-local deliveries or sending groceries long-distance?
  • What delivery timelines do customers expect?
  • How much will labor and fuel cost?

Ecommerce platform

You can run your business on an existing ecommerce platform or build one on your own. While custom-built platforms give you a greater degree of control, it’s often easier to go with an existing ecommerce platform, especially one designed exclusively for online groceries.

Business model

There are many viable business models for online grocery stores. It can be a multi-vendor, hyperlocal model like Instacart or a single-store, omnichannel model like Walmart, with many other iterations in between.

4 ways to make your online grocery store stand out

Even though online grocery is a very competitive market, a new business can still stand out by offering customers valuable services and novel features.

Leverage software solutions to improve your online grocery store’s efficiency and brand recognition, and you will see your sales and profits grow.

1. Advanced inventory management

A grocery store’s fulfillment center is a busy place. Modern automated inventory management software takes the guesswork out of processing and fulfilling orders by providing an unprecedented degree of visibility over your stock.

With every product mapped to its assigned aisle and shelf location, software solutions like the Wave Grocery Picker app make order fulfillment quicker and more cost-effective.

2. Personalized customer experiences

Most consumers are willing to share their data with businesses if it improves their customer experience. To that end, your online grocery store must offer shoppers all the amenities they would use in a physical store, like choosing a weighted quantity of a product or comparing prices.

Because you gather data on customer behavior through your ecommerce platform, you can use it to offer additional features that help to personalize every user’s experience, like:

  • Tailored search results
  • Individual product preferences
  • Delivery method options

3. Green, sustainable online retail practices

With retail giants like Walmart, Krogers, and Amazon Fresh already in the online grocery market, how do you make your store stand out?

One option is to offer a greener alternative. A majority of consumers (73%) say they would change their consumption habits to promote sustainable practices, according to a Nielsen report.

Some environmentally friendly ways your online grocery can operate include:

  • Using recyclable packaging materials
  • Grouping nearby deliveries to reduce carbon emissions
  • Donating a percentage of sales commissions to environmental causes

4. Native smartphone app

An easy-to-use smartphone app is a must-have to run an online grocery store in 2024. A report from Insider Intelligence estimated that mobile commerce (m-commerce) sales will account for 44.6% of all US ecommerce retail sales this year.

Most consumers would prefer using a native app rather than a website. This is because apps allow for better use of the smartphone’s operating software’s built-in features.

Online grocery is here to stay

The rise of ecommerce completely changed the way people shop. Today, at least three out of every four Americans (76%) shop online, according to data from National Public Radio (NPR).

While other categories like consumer electronics and apparel are very popular with consumers, online grocery has been on a steady upward trajectory. A report by Insider Intelligence predicted that by 2026, online grocery will account for 19% of all ecommerce sales, making it the largest category.

As the digital world grows increasingly connected, more consumers will continue buying groceries online. There are over 150 million estimated online grocery shoppers in the United States alone, representing almost half the population. Younger demographics are even more likely to use online grocery stores, with a 2023 report showing that two-thirds of millennials buy groceries online every month.

With such a large existing market and much more growth on the horizon, an online grocery store can potentially revolutionize your business.

The best ecommerce platform to bring your grocery store online

Grocery store owners needn’t worry about having to build their mobile apps in-house. Wave Grocery offers end-to-end ecommerce solutions that let you run an online grocery store with complete ease. Our offerings include a mobile app, picker app, delivery app, administration panel, and more.

The Wave Grocery ecommerce platform is simple to work with and can be scaled up as your business requires. Enjoy the benefits of an ecommerce website and mobile app with no hidden costs.

The business of selling groceries is slowly but surely moving online. Allow Wave Grocery to help your store do the same.

February 29, 2024
Last updated
July 8, 2024
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