Are traditional grocery stores headed for a showdown with Wal-Mart Store Inc. (NYSE:WMT) and Target Corp. (NYSE:TGT) soon? By all indications, they already are, as the two largest discount retailers in the U.S. have been fighting with grocery chains like Publix, Albertsons and Kroger Co. (NYSE:KR) for a while now. Wal-Mart has the "Supercenter" and even the grocery-only "Neighborhood Market" while Target has the "SuperTarget." These examples all carry a full line of grocery items.

In fact, a recent piece of research shows that 46% of shoppers prefer to shop for food where they can also purchase items like clothing, home accessories and CDs. Should that fact alone scare food retailers that could lose (or are losing) customers to the larger discount chains that are placing "everything merchandisable" under one roof and into one trip?

While some customers shop on convenience and atmosphere -- both of which can be hard to find at a Wal-Mart or Target location -- many shop on price and "one stop shop" alone. What are grocery chains doing about it? Well, traditional grocery stores appear to be reinventing product mixes and creating niches to maintain market share and sustain sales growth. At the same time, these grocery chains are trying to capture the attention of an increasingly disloyal army of shoppers who are tired of the "one stop shop" approach. What can they do? Offer customers something unique, as in excellent customer care, eclectic and exclusive products or an innovative store floor plan.