(June 6) The Wal-Marts and Targets of the world have transformed the grocery business, and purveyors of fresh fruits and vegetables must adjust accordingly.

That’s the message of a new study by McKinsey & Co., a New York-based strategic consulting firm. In “Competing in a Value-Driven World,” McKinsey analysts take a close look at “value retailers” — supercenters like Wal-Mart and Target, as well as club stores like Costco.

What they find is that value has transformed retail, and traditional grocers have to do something about it.

The reality is stark: Value retailers have nearly doubled their share of U.S. retailing in the past decade, the report says.

In 1992, value retailers claimed 10.2% of the U.S. retail pie. By 2001, that had climbed to 17.4%. Value’s gain came at the expense of, among other things, foodservice, which fell from a 12.5% share to 12.2%, and the food and beverage category, which dropped from 22.8% to 18%.

And while grocers have historically distinguished themselves by the superior quality of their produce and other fresh departments, they no longer enjoy that luxury, the report says.

In a survey of consumers who live near both traditional grocery stores and value stores that sell groceries, a majority said the value stores have caught up in the quality of their fresh foods.

Grocery has been a cash cow for the value stores.

Value stores have more than doubled their grocery returns on invested capital in the past decade, making them comparable with the best-performing traditional retailers.

High margins mean more labor hours invested in the store, a boon for the quality-control and presentation so crucial to fresh produce.

A long drive from home to store, not low quality, is the main reason consumers polled by McKinsey don’t buy their fresh fruits and vegetables and other groceries at a value store. About 64% of consumers listed distance as the top obstacle, compared to just 7% who cited the poor quality of fresh foods in value stores.

Still, for the time being, traditional grocers are holding back the value store tide.

Less than a quarter of the stores owned by some of the largest national grocers face competition from a Wal-Mart Supercenter. And produce and other service-intensive categories continue to have a strong foothold.

But that will undoubtedly change, the report says, with Wal-Mart in particular coming after grocery full force with its Supercenters as well as its new, smaller Neighborhood Markets, which aren’t so big they have to set up shop on the edge of town.

So what must traditional retailers do to stay viable? Become more consumer-friendly, the McKinsey analysts say.

Value stores may on the surface seem big and impersonal, but they are successful largely because they listen to their customers and adapt quickly to their changing demands. Traditional retailers, the report urges, need to do likewise.