Key Difference: Supermarkets are large self-service grocery stores that offer customers a variety of foods and household supplies. The merchandise is organized into an organized aisle format, where each aisle is numbered or labeled and has only similar goods placed together. A grocery store is a store that sells food items to customers and nothing else. A grocery store is a small version of a supermarket that allows people to purchase dry food items, canned goods and exotic foods or spices from other countries.

Grocery stores and supermarkets are related rather than being completely different. They share many qualities, such as a supermarket is a type of grocery store, while not all grocery stores are supermarkets. A grocery store is a store that sells food, while a supermarket sells food and other items. These other items are what make a supermarket different from a grocery store. A supermarket is also bigger in size, compared to a grocery store.

Supermarkets are large self-service grocery stores that offer customers a variety of foods and household supplies. The merchandise is organized into an organized aisle format, where each aisle is numbered or labeled and has only similar goods placed together. The supermarket houses fresh foods, poultry as well as canned and boxed goods.  Supermarkets are quite larger compared to traditional grocery stores, where people are available behind the counter to provide the consumer with goods and the consumer stands in front of the counter asking for the goods. However, supermarkets are smaller than hypermarkets or big-box markets, which are basically supermarkets combined with departmental stores.

Supermarkets have a special format where it allows consumers to pass through aisles using shopping carts or baskets and pick up whatever they require. Although, the early supermarkets did not house fresh grocery or meat, modern supermarkets have meats, poultry, bread, dairy products and fresh fruits and vegetables. In addition to fresh and canned food, supermarkets also keep household products such as cleaning supplies, baby goods, pet needs, medicine, kitchen appliances, crockery, etc. Supermarkets offer low prices and many deals or discounts on their products to attract consumers. Some even operate on negative profit margins sometimes to bring in customers. Supermarkets usually receive goods and merchandise in bulk from either manufacturers or large distributors in order to avail economies of scale. The profit margin is usually very small and the discounts are forwarded to the customers. Supermarkets may also be part of a huge chain system and may be closer to other supermarkets. Supermarkets closer together can save even more on costs by sharing distributors and slashing their transportation costs. Supermarkets are usually one-level brick and mortar store but may also include two floors depending on the amount of supplies that are kept.

The concept of an inexpensive food market that relies on discounts based on economies of scale was developed by Vincent Astor, who founded the Astor Market in 1915 but failed to be able to make a successful venture and shuttered it in 1917. The first self-service grocery store concept was developed by entrepreneur Clarence Saunders, who founded the Piggly Wiggly stores in 1916. The store become a financial success and become a franchise. Slowly, the concept started becoming popular all over the world, with many developed countries establishing their own self-service grocery stores. In the developing countries, self-service grocery stores are a recent phenomenon and have received only gained popularity in the last decade or so. Specifically in these countries, many supermarkets also offer loose or open merchandise similar to old grocery stores. People can measure out grains, rice and other staple products and buy it by weight. Supermarkets have also started offering ready-to-eat foods as a way to provide the customer to shop as well as eat at the same time. Some supermarkets may also have banks, ATMs, coffee bar, juice bar and anything else that may attract customers.

 A grocery store is a store that sells food items to customers and nothing else. A grocery store is a small version of a supermarket that allows people to purchase dry food items, canned goods and exotic foods or spices from other countries. Grocery stores were the place where people would purchase their food, fruits and vegetables before. Before the World War II, neighborhood grocery stores were the only place where people would purchase their groceries. This all changed after the War, when supermarkets or self-service grocery stores started becoming a trend. Supermarket provided additional supplies such as wet groceries, ready-made food, cleaning supplies and other household items.

A grocer, the owner of the grocery store, would stock the store with exotic as well as local supplies. He would also employ young store hands that would help in bagging groceries, taking groceries out and delivering them. The grocer would specifically be in charge of jotting down customer bills and maintaining accounts. The store would have a counter, behind which the grocery and his helpers would be. They would go around the whole store and bag whatever the customer requires. The people could then put the groceries on credit, which would be cleared at the end of the month. Many people could also give their orders over the phone, which would be delivered to them.

The shift from grocery stores to supermarkets began with the introduction of cheaper vehicles. Vehicles allowed people mobility, which did not limit them to the groceries in the neighborhood. They could travel to different places and sample foods and groceries from them firsthand. The mobility also contributed to the success of the supermarket. Though grocery stores have become obsolete in many developed countries, developing countries still keep grocery stores. In India, these stores are called as Kirana stores. Grocery stores are not limited to keeping just dry food and spices and have also expanded to include some daily used household items such as cleaning supplies, soaps, tissues, etc. Some grocery stores also specialize in foods and goods of a certain nationality, such as Middle-Eastern, Italian or Indian. These stores are known as ethic markets. Some grocery stores also predominantly sell snack foods and sandwiches are known as convenience stores or delicatessens.

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