Fresh Is Physical Grocery’s Power Category—Now More Than Ever.

In an era of rising consumer expectations, razor-thin margins, and digital disruption, fresh is where brick-and-mortar grocers win. While e-commerce giants dominate in price, speed, and endless assortment, they still struggle to replicate the immediacy, sensory appeal, and trust-building power of fresh departments.

Fresh—produce, meat, seafood, deli, bakery, prepared foods, and floral—aren’t just categories. They’re high-value strategic drivers of growth where shopper loyalty, brand trust, and financial performance are earned (or lost) every single day. This is no longer just an in-store differentiator, it’s the irreplaceable advantage of physical retail.

Fresh is Redefining Grocery’s Growth

According to the FMI State of Fresh Foods 2024 report, 42% of total grocery sales in 2023 came from fresh departments. Perhaps even more striking, fresh and perimeter categories made up 41% of online grocery revenue.

Fresh is no longer just the store’s perimeter. It is the performance center. Quality, availability, selection, and price anchors shopper trust, drives basket size, and reflects brand strength.

It has become the revenue engine, the trip generator, and the key differentiator in a digital-first market. Unlike center store goods, which are increasingly commoditized or fulfilled online, fresh is tactile, time-sensitive, and operationally complex.

Why Fresh Became Retail’s Strategic Frontier

1. Shoppers are prioritizing the quality of fresh departments

Nearly one-third of shoppers say the quality of the produce department determines where they shop. And the value placed on freshness extends beyond selection: two-thirds of U.S. grocery shoppers say they would pay a premium—on average 22% more—for fresh food, with 90% reporting that fresh offerings directly impact their sense of satisfaction and happiness. While promotions may attract attention, its availability and quality that keep shoppers loyal.

2. Health, Convenience & Local Still Reign

FMI’s report reinforces enduring trends in consumer preferences:

• Health and wellness continues to drive fresh choices, especially in produce and meat.
• Convenience is critical, with shoppers looking for ready-to-eat and easy-to-prepare options.
• Locally-sourced products are tied to quality, freshness, and sustainability in the eyes of today’s consumer.

Retailers who get fresh right aren’t just meeting demand, they’re aligning with core values that build long-term trust and loyalty.

3. In-store, fresh departments continue to lead traffic

Fresh departments pull customers into the store and anchor the in-person experience. The sensory, immediate, and personalized nature of perimeter shopping is hard to replicate online. In fact, FMI reports that traffic continues to increase around the perimeter, making it a key driver of store visits.

For retailers navigating hybrid formats, fresh is the connective tissue that links physical presence to brand experience in a way few categories can.

Margin Maker and Margin Risk

All this potential comes with real operational weight. These are the most perishable, labor-intensive, and variable parts of the store, and they’re also where losses accumulate fastest. The perimeter accounts for the highest shrink across the store, with an average shrink rate of 6.6% across fresh departments. When forecasting is off or rotation falls behind, the impact on margins, shopper satisfaction, and sustainability targets is immediate.

Yet fresh is also where labor drives the highest return. Meat and produce departments lead in sales per labor hour, according to FMI, making them high-leverage areas for productivity and automation investment.

The bottom line: fresh is both a margin maker and a margin risk. Shelf execution is everything.

Grocers Need Better Tools to Manage Fresh

Despite its strategic importance, many grocers still rely on outdated processes to manage fresh. Manual audits, fragmented systems, and inconsistent practices slow response times and limit visibility. Store associates spend hours on repetitive shelf checks, managers operate without real-time data, and digital teams are often left without a clear picture of what’s truly available on shelves.

No surprise, then, that a growing number of retail leaders are shifting focus. More than half of grocery executives expect fresh to be their most strategically important department over the next one to three years. From cutting food waste to fulfilling omnichannel demand, grocers are actively seeking intelligent platforms to manage fresh execution with more speed, accuracy, and accountability.

How Simbe Digitizes Fresh: Execution, Insight, and Impact at Scale

Simbe’s Store Intelligence™ platform was built for retail and designed to flex across every department, every store, and every operational model. While built for retail, it’s become a go-to platform for solving the unique problems that fresh presents.

Working closely with top-tier grocery partners, Simbe has developed and tested fresh-focused capabilities that deliver real-world results across categories like produce, prepared foods, and deli.

With Simbe, retailers can:

• Maximize availability during peak periods
• Reduce shrink up to 42% by identifying overstock early and rotating inventory
• Cut food waste by up to 88% through better freshness tracking
• Improve labor efficiency by automating checks and audits
• Maintain brand standards across locations even when staffing is tight

Deliver a consistent shopper experience, rooted in quality and trust

Fresh is Now More Than a Department

Fresh is where grocery’s future is unfolding. It’s where consumer demand meets operational complexity. And increasingly, it’s where competitive edge is gained or lost.

Retailers can’t afford to manage these areas like they did a decade ago. The stakes are too high, and the margins are too tight. To win, they need real-time, multimodal intelligence that brings visibility, actionability, and accountability to every shelf and every department.

Fresh is too strategic to leave to guesswork. Simbe gives you the shelf-level truth to act with speed, accuracy, and confidence.

Want to learn more? Contact us today.