Inflation pushes annual grocery shop up by more than £500

Grocery price inflation is at the highest level since Kantar started measuring it in 2008, the analyst said today. Grocery inflation hit 11.6% over the past four weeks.

Fraser McKevitt, Kantar’s head of retail and consumer insight, said: “As predicted, we’ve now hit a new peak in grocery price inflation, with products like butter, milk and poultry in particular seeing some of the biggest jumps. This rise means that the average annual shop is set to increase by a staggering £533, or £10.25 every week, if consumers buy the same products as they did last year.”

The last three months indicated that supermarket sales have grown, although by far less than the rate of inflation. Sales were up 2.2% in the 12 weeks to 7 August.

There are also clear signs that shoppers are making changes in how they spend their grocery budget.

McKevitt said: “It’s not surprising that we’re seeing shoppers make lifestyle changes to deal with the extra demands on their household budgets. Own-label ranges are at record levels of popularity, with sales rising by 7.3% and holding 51.6% of the market compared with branded products, the biggest share we have ever recorded.”

Consumers are also showing a willingness to shop in different stores in order to find the best deals.

McKevitt said: “People are shopping around between the retailers to find the best value products, but back in 2008 there was much more of a reliance on promotions. It’s harder to hunt these deals in 2022 – the number of products sold on promotion is at 24.7% for the four weeks to 7 August, while 14 years ago it was at 30%.”

Annual footfall continues to pick up while online shopping slows. McKevitt said: “Shoppers have made the most trips into stores since March 2020. This is understandably impacting on the online grocery market, and its total share has dropped to 11.8%. This is the first time online’s share has dipped below 12% since the early days of the pandemic.”