Grocery Outlet (GO) Morgan Stanley Global Consumer & Retail Conference 2025 summary

Business performance and consumer trends

• November saw an 8% decline in SNAP sales and a slight deceleration in non-SNAP sales, reflecting pressure on lower-income customers and increased trade-down behavior.

• Traffic remained positive, but average unit retail (AUR) dropped as customers shifted to lower-priced or smaller items to stretch budgets.

• SNAP sales were highly negative in early November but rebounded in the latter half, though overall comps declined.

• Inflation and economic pressures are leading to more consolidated shopping trips and cautious spending, especially among customers reliant on public transit or sensitive to fuel prices.

Store refresh and operational improvements

• A pilot Refresh program is underway, focusing on improving in-store experience, navigation, and value communication, with favorable results in pilot stores.

• Changes include co-locating produce and meat, improving merchandising, and ensuring core items are consistently in stock, leading to mid-single-digit sales increases.

• The program started with a few stores and is expanding, aiming to reach over 150 stores next year, with nearly 20 completed by year-end.

• Early results show pilot stores outperforming the rest of the network, with increased basket size and traffic.

Marketing, pricing, and customer engagement

• Marketing efforts are shifting toward clearer in-store communication and external storytelling, highlighting real customer savings and value.

• Price perception lags actual value; explicit basket comparisons and staff education are being used to reinforce the value proposition.

• Everyday items and national brands are being added to meet customer needs, with a focus on competitive pricing to drive larger baskets and build trust.