Grocery giants are turning to artificial intelligence to combat food waste and protect profits as inflation-weary shoppers demand better value.
Around the world, supermarkets face relentless pressure from rising costs and shifting consumer behaviour. In the U.S., discounters like Dollar General and Costco are gaining ground, according to NielsenIQ figures, while in the UK, Aldi and Lidl hold a combined 20 per cent market share.
Shoppers now visit more stores for deals, with a Deloitte study revealing that 89 per cent seek discounts and Numerator data showing a 23 per cent increase in grocery outlet trips.
AI offers a smart solution by dynamically pricing perishables close to their best-by dates, tackling massive waste. The USDA reports that 30 per cent of U.S. supermarket food, worth $18.2 billion, goes to landfill each year. In the UK, WRAP pegs annual losses at 6.4 million tonnes and £2 billion. With fuel prices surging anew, grocers aim to cut this “shrink” through technology.
Kroger leads the pack. “We see AI as a meaningful opportunity to both improve the customer experience and drive productivity across our business,” Chairman Ronald Sargent said on the latest earnings call. “We’re already seeing results from more competitive pricing.”
Platforms like Flashfood connect stores with bargain hunters, letting customers buy near-expiry items via app and collect from in-store zones.
“Not only is everyone now a value shopper, but shoppers have the information and resources available to find the best deal,” CEO Jordan Schenck noted. “This raises the stakes in terms of competition between grocers, because they’re now competing with value-specific retailers.”
The results impress: partners such as Kroger, Piggly Wiggly, Loblaws, and Gelson’s cut shrink by 27 per cent, while app users add four extra trips monthly and $28 in full-price spend. McKinsey’s 2026 report highlights 20-30 per cent sell-through gains for items like bakery and produce.
“Grocery stores have some of the best personalized data, but not all grocery stores know what to do with the data,” analyst Bill Kirk of Roth Capital Partners observed. “Kroger has been at the forefront of recognizing the importance of their data and the insights that can be derived.”
From Tesco’s AI trials in 200 UK stores to Walmart’s 15 per cent waste reduction, this tech bridges excess stock and deal-seekers, securing margins in tough times.