Supermarket Industry

A supermarket is a self-service shop that offers a wide variety of food, beverages and household products organized into sections under one roof, a format that emerged around 1930 in the United States before spreading worldwide. The industry business model relies on self-service with shopping carts to reduce labor costs, bulk purchasing power that lets chains negotiate lower prices than smaller stores can obtain, extended payment terms with vendors, loss-leader pricing on staple items to draw in customers, and high sales volume to offset thin profit margins. By 2018 the United States alone had about 38,000 supermarkets, where Americans spent 701 billion dollars annually, and the format efficiency has been credited with cutting the share of disposable income Americans spend on food from 21 percent in 1930 to 16 percent by 1940.