For the European grocery sector, 2025 brought a period of stabilisation, with shopper spending patterns broadly unchanged while retailers continued to face cost pressure.
Looking into 2026, 64 percent of grocery CEOs expect market conditions to improve or remain stable compared to 2025, yet margin pressure, strong competition and limited growth prospects remain key concerns.
The report is based on surveys of over 35 grocery executives and more than 15,000 consumers across 14 European countries, supported by market analysis conducted in early 2026. According to the interviewed CEO’s, major trends are:
- Increased cost and margin pressure
- Adopting AI and automation
- Strengthening private label
- Finding new growth opportunities
- Downtrading of consumers
While input costs showed early signs of easing at the start of 2026, the operating environment remains sensitive to geopolitical shocks and shifts in consumer sentiment. The McKinsey and EuroCommerce State of Grocery Retail Europe 2026 report highlights how tensions, including recent developments in the Middle East, could quickly affect inflation, supply chains and demand.
Simon Wintels of McKinsey will present the findings of the report during PLMA’s pre-show seminars on Monday 18 May. Admission to the seminars and workshops is complimentary to all registered visitors and exhibitors who possess an official 2026 World of Private Label entrance badge. Click here for the detailed programme.