Global retailers find growth with smaller, community-based formats

The National Retail Federation’s annual Top Global 50 Retailers list ranks the nation’s top international retailers based on their operations at the start of the previous year.

Over the past few years, global retailers have increasingly redirected investment away from big-box hypermarts, supercenters, department stores and grocery stores and toward smaller, community-based formats. These smaller stores have emerged as a cost-effective way to serve shoppers across markets, and have allowed for increased funding of expanded IT capabilities, higher labor costs and more efficient warehousing and distribution. 

Remodeling existing stores into smaller formats has become common in Canada, Europe, Asia and Latin America.  

Sobeys has been converting Safeway stores in western Canada to the popular FreshCo small format. Loblaw has been taking a similar approach in eastern Canada with its Maxi and No Frills stores. Carrefour has moved away from its hypermart-led strategy in favor of expanding its smaller Express grocery stores in all its markets. And in Japan, Aeon has turned a number of its urban locations into the Aeon Living format. 

In Colombia’s competitive market, retailers are building new smaller chain stores. Exito’s new owner, Grupo Calleja, aims to expand the 2,000-store Aliados Surtimax chain. In parallel, the broad range of small discount grocers in Colombia, including D1, Ara and Isimo, has shifted the market away from larger grocery and hypermarts. 

The format has also spread to Pacific Coast countries in Latin America. In Peru, Mass has been a particular success story. That format and the smaller warehouse grocer Hiperbodega Precio Uno are now expanding into Chile, where Peru-based Intercorp recently bought 39 stores of the small-format grocery chain Erbi. 

Walmart has pursued a small-format strategy outside the United States and Canada for many years. In urban areas in China, Walmart has been expanding its community markets, which it describes as “small, curated and nearby.” These stores are also integrated with digital services that extend product and service offerings beyond the physical store. In Central America, Walmart continues to open the smaller Pali and Paiz banners, while in Chile, it has remodeled all its small to medium-size grocery stores under the Lider Express banner. 

In Mexico, Walmart’s Bodega Aurrerá, Mi Bodega Aurrerá and Bodega Aurrerá Express stores have long dominated the small grocery sector. However, the market has changed in the last few years with new entrants and shifts among existing discounters. 

In the past few years, Femsa (Oxxo) has opened over 500 Bara community stores, and expects to operate over 1,000 by 2028. Grupo Salinas has opened almost the same number of Super Precio stores. For their part, deep discounters Tienda 3B and Waldo’s have expanded their portfolios to include a broader assortment of grocery and household goods.

Edeka has been growing its Netto Marken-Discount chain in Europe, while BIM is expanding beyond Turkey into Eastern Europe and the Middle East. The smaller SPAR formats have experienced major growth in Africa, parts of Southeast Asia and India. 

Also in India, Reliance has reinforced its rapid growth in B2C and B2B retail by hiring Guillaume de Colonges, Carrefour’s former global chief commercial officer. With a long history of managing several of Carrefour’s country groups, he is well positioned to bring discipline to Reliance’s diverse regional markets and grocery banners, including Reliance Smart, Reliance Smart Bazaar (including stores acquired from the Future Group), Fresh Signature and Freshpik. 

Given the lower costs required to open and operate small grocery stores in most markets, the format is likely to continue growing as retailers navigate the uncertain environment expected in 2026 and 2027.