A freelance graphic designer in Gilmer, Texas, wanted to buy bacon on a recent trip, but “just walked away” because it was too expensive. In November, the price of bacon rose by 2.3% from the previous month, an annual increase of 17.8%.
Moore also started shopping at Dollar General more frequently, buying basic meat, dairy products and eggs. She found that the prices there were “a little cheaper, but still not as cheap as I hoped.”
“It’s a squeeze,” said Matt Larson, a teacher in Salt Lake City, Utah, who shopped for his wife and four children in Kroger and Costco.
The price of ground beef in November rose 0.9% from the previous month, an average annual increase of 13.9%, while the price of milk rose 0.9% in November, an average annual increase of 4.5%.
“It’s hard to spend that much money on beef,” Larson said.
“We rely on what we have, rather than going out to buy more things,” he said.
Buy cheap food
Shoppers feel pain in the checkout channel, and they say they won’t wait too long.
At the end of September, a survey of more than 14,000 consumers conducted by the market research term Numerator found that 20% said that if prices continue to rise, they will switch to cheaper brands. 17% said they would switch retailers, and 10% said they would reduce the frequency of purchases. 11% of shoppers surveyed stated that they will not change their buying patterns.
According to IRI point-of-sale data from leading supermarkets, hypermarkets, wholesale clubs, and other shopping channels, in the four weeks ending November 28, 78% of sales in the top 100 food categories were down from the same period last year. Higher prices often result in lower sales-the number of products sold.
The sales of breakfast meat, milk, eggs, cereals, ice cream, fresh bread, seafood and wine have fallen the most every year.
Switch to discount store
KK Davey, President of Strategic Analysis at IRI, said that in the past, customers have responded to higher prices or more severe economic conditions by reducing their purchases of pre-made foods and desserts, stockpiling at the beginning of the month, and shopping more at discount chains.
Costco Finance Director Chad Galanti said on an analyst conference call last week that this level of inflation “helps us because of the value proposition we have.”
Last month, Dollar Tree CEO Michael Witynski said on an analyst conference call that customers are “feeling inflation.” “I think now, they will rely on great value more than ever.”
Tops Markets, a regional supermarket chain in the Northeast, predicts that as food manufacturers increase prices in January 2022, shoppers will look for more bargains.
Christine Hansen, vice president of merchandise, private label and pharmacy at Tops Center, said in an email that increased costs and supply constraints “will affect how consumers shop and choose.” “We suspect the shift to low-priced goods,” many of which will be Tops’ own brands.
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