Supermarkets and specialty food-product retailers are among the strongest performers, our study of the fastest-growing companies finds.
The world's biggest retailer, Walmart, continues to grow steadily, but shuttered its healthcare services in the U.S. in the summer of 2024, citing the "challenging reimbursement" process. At the same time, a pharmacy group, Redcare Pharmacy, found rapid gains (30% revenue CAGR over the past two years) through building out its digital pharmacy in Europe. Redcare appears on our list of the fastest retail growers—evidence that a change-positive approach can win market share. In this article we will explore common themes we find among our fastest growers and talk about what it means for the future.
The top two firms in the retail category saw revenue growth of 90% (PDD Holdings, Inc.) and 86% (Avolta AG) over the past year, accounting for roughly 72% of the total revenue among the top 10 Fastest Growers in retail. PDD Holdings—which owns low-cost-goods retailer Temu and Chinese e-commerce site Pinduoduo, and is now based in Ireland—accounted for 50% of the total revenue on our list, putting it in a category of its own with 412.3 million Temu orders dispatched in 2023—the volume roughly doubling each quarter. PDD/Temu is a classic disruptor that cuts through the retail value chain. Its digital platform is an aggregator that allows China-based fast-fashion apparel and goods makers to bypass distributors and sell directly to customers (an approach Amazon is working to emulate).
Outside of these outliers, those making gains in retail are primarily focused on three growth strategies:
- Investment in store and distribution footprints
- Private-label product lines
- Digital-first models
Firstly, we find that geographic reach and supply-chain resilience are kingmakers. Polish supermarket Dino Polska has invested in new distribution facilities to create a network that supports the rapid expansion of its stores. Fresh produce supplier Orsero has likewise invested in logistics and distribution to strengthen the supply chain and deliver on its promise of ripe, delicious fruit and vegetables in southern Europe and Latin America. AMCON Distributing Company already boasts a robust logistics network but invested in M&A to build it out further over the past year.
Suppliers like AMCON have also seen success from the development of private-label products. Service stations across the U.S. can stock their own branded bottled water and candy at a retail sticker price that appeals to customers and boosts revenue at the same time, thanks to AMCON's offerings. UK wholesaler Kitwave Group, p.c. has similarly found strength in own-label product lines, expanding into the independent retail, vending, and food-service sectors with high-margin offerings with low order minimums.
Rounding out the trifecta of winning strategies for retail, we see big wins for companies capitalizing on industry inflection points with a digital-first strategy. Take Redcare Pharmacy, which positioned itself to capitalize on the growing e-prescription market in Europe as customers and healthcare providers continue to move online post-pandemic (see Amazon's acquisition of PillPack). Likewise, The Chef's Warehouse has set itself apart from other distributors by targeting high-earner independent restaurants (Jean-Georges, Daniel), and implementing AI-assisted search to improve the customer experience.
You don't need to be in the "largest" Western market or an upstart to appear on the list. We see broad strength in Europe for the list, with only two firms based in the U.S., and impressive performances from long-established retail firms like Avolta, the 159-year-old Swiss retailer that operates duty-free, gift, and convenience stores in airports, railway stations, seaports, and aboard cruise lines, as well as other tourist hubs. Stationer WH Smith PLC bests it as the oldest fastest-grower at 232 years old; it, too, has expanded by opening locations in airports and other transportation centers. Avolta and WH Smith have also benefited from the post-COVID rebound in travel.
Here, we focus on retail companies demonstrating these winning strategies as retail contends with stubborn inflation and supply-chain turbulence.
Redcare Pharmacy NV
The "local" pharmacist is increasingly online, and long-time chemist brand Redcare Pharmacy, based in the Netherlands and active in Europe, has found a way to build trust in the e-commerce channel. In 2023, the company rebranded from "Shop Apotheke Europe N.V." to emphasize its positioning as a healthcare business, and the move paid off: Redcare had an average customer net promoter score of 71 and repeat orders for 85% of customers last year. The company was well-positioned for the eventual rollout of electronic prescriptions in Germany in mid-2023, partnered with leading Swiss healthcare provider Galenica AG, and otherwise saw its non-prescription business grow 23% in the DACH region.
The Chefs' Warehouse, Inc.
There's a shortage of peppers needed for Sriracha sauce; attacks on Suez Canal shipping have delayed the delivery of shrimp from Thailand to Europe; there's a sudden shortage of kosher salt—such are the market challenges for specialty food distributor The Chefs' Warehouse, Inc., founded in 1985, which recorded strong growth in the first quarter 2024 of $874.5 million, a 21.5% increase from the previous year. The company caters to independent restaurants, fine dining establishments, country clubs, hotels, caterers, culinary schools, bakeries, and specialty food stores but has found top-performing independent restaurants to be a highly lucrative slice of the overall market (62% of customers are chain restaurants; 38% are independent). It operates in the U.S., Canada, and select Middle Eastern markets and has pushed through logistical headwinds with its "high-touch, flexible distribution platform," including AI-assisted online search, bridging the specificity of specialty suppliers and the geographic reach and range of generalist suppliers to win over restauranteurs.
To put a finer point on their value proposition, as the haute restaurant supplier in a golden culinary age (see: The Bear), The Chef's Warehouse is where EATALY gets its goods. Also, Milk Bar, MGM Resorts, and Daniel. The company has used small bolt-ons ($130 million a drop in the bucket for the company's roughly $3.4 billion revenue) to boost supply-chain resilience and extend its footprint: In 2023, it acquired Hardie's Fresh Foods and Greenleaf Produce & Specialty Foods to build out its produce category nationally, expand its geographic reach in California and Texas, and bolster its stores of premier meats at a time when beef supply anxiety is high.
Dino Polska, S.A.
In 2020, Dino Polska had 1,473 supermarkets in Poland and now has over 2,400, with plans for further rapid expansion. Founded in 1999 and headquartered in Krotoszyn, Poland, Dino operates a network of mid-sized supermarkets primarily in less urbanized areas with good proximity to underserved customers, supported both by a strong branded offer and an emphasis on fresh and healthy products. The company is focused on investment: ongoing investments in photovoltaic panels saw the retailer generate 37.4% more solar power in the first quarter of 2024 over the same period in 2023. This is attractive to eco-conscious consumers.
Dino Polska has also constructed new distribution centers to support the logistical requirements of its expanding store network and improve supply-chain efficiencies. The company emphasizes the availability of fresh produce and high-quality products and dynamically responds to consumer demands and trends to stay competitive.
Orsero, S.p.A.
Mid-summer in Milan, large billboards offered passersby the tantalizing sight of blueberries, raspberries, currents, and blackberries. Italy-based fruit and vegetable import business Orsero S.p.A., formerly known as Glenalta Food S.p.A., was behind the campaign, having made tropical fruits and consumer favorites their business. The company imports and distributes bananas, pineapples, avocados, and other fruits and vegetables to retail chains and wholesalers and has supported its value proposition as a reliable supplier of ripe premium fruits by acquiring an 80% stake in French company Blampin S.a.a. and CAPEXO S.a.s. in one parcel.
Orsero's operations span Italy, France, Spain, Portugal, Greece, and several countries in Latin America and Central America, and it has invested in logistics and distribution infrastructure to improve supply-chain efficiency and ensure product quality.
AMCON Distributing Company
If there's a road, there's a good chance AMCON Distributing Company has delivered products along it. Across the U.S., AMCON has grown through its core business, supplying convenience stores with tobacco, beverages, groceries, and health and beauty items. Established in 1986, the company is based in Omaha, Neb. It has expanded its line of health products under the Chamberlin's Natural Foods and Earth Origins Market brands to capitalize on demand for organic and natural products. AMCON has also pushed margins wider through the development of private-label products like bottled water and candy, which attract price-sensitive customers there to refuel.
The company has a well-established distribution network across key U.S. regions, supporting its supply chain operations, and has also invested via M&A in Burklund Distributors in early 2024 to expand its reach in the Midwest.
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