2026 Retail Supplier Playbook
- Jon Allen
- 5 days ago
- 5 min read
The big picture
2026 looks like a year of modest top-line growth, more challenging profit math, and more “systems-driven” retail. Translation: retailers will still want growth, but they’ll increasingly demand it through automation, tighter compliance, and pay-to-play visibility.
Circana’s latest outlook expects U.S. food and beverage retail dollar sales growth of 2% to 4% in 2026, with growth driven more by price/mix than easy volume gains. That’s a margin environment where execution beats optimism.
1) Value shopping stays sticky, and promo pressure rises
Consumers are still feeling price fatigue. Retailers will continue to rely on promotions and sharper price points to drive traffic.
Supplier impact
More pressure on trade spend effectiveness (not just spend).
More scrutiny on price gaps vs. private label and “value brands.”
More demand for pack/price architecture that can win in both everyday and promo.
What to do now
Build a simple “price pack ladder” for your top items: good/better/best, plus a promo-ready pack.
Start 2026 with a promo calendar that is tied to inventory reality (not wishful thinking).
2) Private label keeps gaining ground
Retailers are not shy about investing in their own brands. PLMA projected U.S. private-label sales would reach $280 billion by the end of 2025, representing about 21% of the total U.S. food and grocery market. FMI survey data also indicate that many retail and manufacturing leaders plan to increase private-brand investment over the next two years.
Supplier impact
“Me-too” branded products will get squeezed.
Brands that can prove differentiation (taste, claims, convenience, performance, story) will still win—but they’ll need to prove it faster.
What to do now
Tighten your differentiation into one sentence a buyer can repeat.
Validate it with proof: reviews, velocities, repeat rates, or a tight test-market story.
Assume your product page and packaging must “sell” in 3 seconds.
3) Retail media grows again—but it concentrates
Retail media is projected to hit $69.33B in the U.S. in 2026 (up from $58.79B in 2025). And eMarketer notes that most incremental growth is expected to accrue to Amazon Ads and Walmart Connect—meaning the “rich get richer” dynamic continues.
Supplier impact
More pressure to fund visibility to defend share, not just to grow it.
More complex measurement conversations (incrementality, halo effect, and attribution wars).
What to do now
Treat retail media like a portfolio: defense spend on hero SKUs + growth spend on new bets.
Align media to operational readiness (in-stock and content clean first).
Ask a blunt question before you spend: “If we win traffic, can we win conversion and stay in stock?”
4) AI changes shopping behavior and retailer expectations
2026 is shaping up to be a year when “AI shopping” becomes normal—not for everyone, but enough people that it matters. Forrester’s 2026 predictions frame a future where answer engines and agentic commerce pull attention away from traditional journeys; they note only 24% of U.S. online adults had used ChatGPT (as of their 2025 survey), but the direction is clear.
At the same time, Reuters reports many businesses still struggle to turn generative AI into consistent profit, with surveys cited by Reuters (Forrester and BCG) showing only a minority reporting meaningful improvements so far. That’s important: adoption is rising, but performance will be uneven.
Supplier impact
“AI-ready content” is a significant competitive advantage: clean attributes, clear claims, strong imagery, and consistent pack/case data.
Faster, more automated decisioning means errors are punished more quickly (pricing files, compliance misses, item setup mistakes).
What to do now
Run an “AI readiness” audit on your top 20 SKUs:
Are titles, bullet points, attributes, and claims consistent throughout?
Are images retail-compliant and conversion-optimized?
Is your item setup data clean enough to survive automation?
Fictional example (for illustration only): A brand’s product page calls something “sugar-free,” but the ingredient panel and attribute data don’t align across systems. A human might shrug and fix it later. An automated compliance or search system may suppress visibility. Same product. Different outcome.
5) Tariff and trade volatility remains a board-level variable
This is not calming down. Reuters analysis of corporate filings and earnings calls estimated that companies faced a significant tariff hit in 2025 and calculated nearly $15B in 2026 impact based on hundreds of corporate statements. The OECD commentary covered by Reuters also noted that global trade growth is moderating to 2.3% in 2026, as tariffs weigh on investment and consumption.
And trade professionals are loudly signaling uncertainty: Thomson Reuters’ 2026 Global Trade Report says 72% cite U.S. tariff volatility as the most impactful regulatory change they face.
Supplier impact
More frequent re-costing cycles.
More pack/price changes.
More margin erosion if you can’t move quickly.
What to do now
Build a tariff “if/then” playbook:
If landed cost moves by X%, here are the pack/price options.
Here’s the customer communication template.
Here’s the promo guardrail to prevent the P&L from blowing up.
6) SNAP changes become real in 2026
These are no longer theoretical. USDA’s SNAP waiver list shows multiple states with food restriction waivers effective across 2026 (many targeting soda, energy drinks, candy, and sweetened beverages), with specific effective dates by state.
There are also legal and administrative complications around SNAP eligibility guidance—Reuters reported a federal judge required USDA to extend compliance timing related to immigration-related restrictions.
Supplier impact
Demand shifts in value channels and certain geographies.
More item eligibility and data accuracy pressure.
Higher stakes for “better-for-you” positioning and compliant claims.
What to do now
Map your exposure by state and category (even a rough map helps).
Identify which SKUs need reformulation, repositioning, or portfolio balancing.
Tighten item data governance—misclassification costs money.
7) Compliance tightens, and deductions remain a cost-to-serve tax
This is the least exciting trend and the most expensive to ignore. Retailers will continue to automate compliance and enforce standards with fewer humans in the loop—especially in a labor market still reducing headcount.
Retail job cuts in 2025 were materially higher year over year, per Challenger’s tracking. When retail runs lean, exceptions don’t get handled faster. They get handled more mechanically.
Supplier impact
More auto-issued claims.
Longer dispute cycle times.
Higher internal labor cost per recovered dollar.
What to do now
Treat deductions like a KPI:
top codes by dollars and count
win rate
cycle time
root cause fixes by owner (ops vs. finance vs. sales)
8) “Next barcode” and packaging regulation prep becomes a 2026 workload
Two operational shifts suppliers should not sleep on:
GS1 Sunrise 2027: the industry push for retailers to read 2D barcodes at point-of-sale by the end of 2027. That makes 2026 a prime year for pilots and preparation.
Packaging EPR laws: multiple states have enacted Extended Producer Responsibility (EPR) packaging laws; legal updates summarize seven states with comprehensive EPR packaging laws as of late 2025.
Supplier impact
More compliance work that doesn’t feel like “selling,” but affects eligibility and retailer confidence.
Potential fees, reporting requirements, and packaging redesign requirements depend on the footprint.
What to do now
Assign an owner for 2D barcode readiness and EPR monitoring.
Start with your highest-volume SKUs and highest-risk packaging.
What retail suppliers can do now: a practical 2026 jumpstart
If you only do eight things before Q1 gets busy, do these:
Build a retailer-level cost-to-serve view (even rough): margin – trade – freight – deductions – dispute labor.
Make deductions visible weekly, not monthly.
Standardize your “proof packet” (PO, invoice, delivery, promo terms, compliance docs).
Run an AI/content readiness audit on your top SKUs (attributes, images, claims, consistency).
Re-architect pack/price to win value shoppers without living on promo.
Treat retail media like a portfolio, not a panic button.
Create a tariff scenario playbook with decision triggers.
Map SNAP exposure by state/category and plan your portfolio response.
If you do those, you’re not just defending 2026. You’re setting yourself up to take a share while others are still explaining variance.
Woodridge Retail Group’s view is simple: keep it practical, keep it measurable, and keep it tied to what retailers actually enforce.