Supermarket or Grocery Store? Which one will be more Profitable?

The first thing that comes to our mind, before starting a business, is the profit margin. Yes, we conduct a business to earn a good return and not to spend a lump sum amount in a never growing business. Both these supermarkets and grocery stores can bring greater profit if conducted out t of the right place. What matters is the distribution services. Making availability of top-rated products and daily necessities at a lower price attracts customers.

With constant population growth, consumer demands are increasing. People are getting engaged in building careers and looking forward to higher salaried jobs. Most of the people working in Dubai have financial strength but lack time for their personal space. To meet the regular needs, supermarkets and grocery stores have evolved in densely populated areas.

Though both serve the same purpose yet there are differences. Supermarkets lay their foundation within malls or market complexes. Whereas the grocery stores are small retailers in your locality. The profit margin for supermarkets is the lowest. In the case of grocery stores, it is 1 to 3% profit, but it keeps rising with the volume. People need more than one item whenever they are visiting a grocery store as these are daily necessities. On a whole, the profit margin grows. Supermarkets are chain marketing distribution services therefore the profit margin reduces.

Supermarkets provide all your necessities in one destination. For example, you can find electronic items, toiletries, fruits and veggies, snacks, fresh meat, organic products, basic items of clothing, and so on. But again you need to overstock in a supermarket whereas grocery stores order items according to their consumer demands. When the setup cost, labour charges, designing cost, and all other miscellaneous expenses are added, it is seen that supermarkets cost you higher than a small grocery store. Grocery stores are small and deal with fresh food items as well as pre-packaged goods. These are added with some non-food household items like cleaning products, over-the-counter medications, and so on.

The distribution services offered by top retailers include all the branded items gathered from dealers around the world. While others deal with local products. The food and beverage industry of Dubai is growing day by day and therefore these industries are looking forward to earning higher profits shortly.

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