Inflation Hits Record High, Struggling Households Rise, and Discount Retailers Thrive
- Grocery price inflation hits record 14.7%
- Take-home grocery sales increased by 5.2% in the 12 weeks to October 30, 2022
- Own label sales grew by 10.3%, branded goods slower at 0.4%
- 27% of households struggling financially, up from last November’s figure
- Higher food and drink prices a major concern for 9 in 10 struggling households
- Fewer shoppers buying Christmas pudding compared to last year
- Discounters Aldi and Lidl see market share rise, now at 16.4% combined
- Aldi was the fastest-growing retailer with a 22.7% increase in sales
Grocery price inflation has reached a new record high of 14.7%, according to Kantar, leading to an additional £682 in annual grocery bills. Take-home grocery sales increased by 5.2% during the 12 weeks ending October 30, marking the fastest market growth since April 2021. Own label products saw a 10.3% increase over the past four weeks, while branded goods grew at a slower 0.4%. Kantar found that 27% of households are now struggling financially, double the proportion from last November, with nine in ten of this group citing higher food and drink prices as a significant concern, second only to energy bills. Fewer shoppers bought Christmas pudding compared to the previous year, indicating people are delaying purchases. In October 2021, two million consumers had already purchased their festive dessert, but Kantar observed a 32% decrease in this trend. Fraser McKevitt, head of retail and consumer insight at Kantar, commented: ‘It’s too early to call the top.’ He added that food and drink spending is non-discretionary, making it difficult for shoppers to cut back on purchases. The shift towards own labels continues to accelerate, with discounters Aldi and Lidl seeing a combined market share of 16.4%, up from 4.4% 14 years ago.
Factuality Level: 8
Factuality Justification: The article provides accurate information about the increase in grocery price inflation, take-home grocery sales, and changes in consumer behavior due to financial struggles. It also includes relevant data from Kantar and insights from Fraser McKevitt. However, it lacks a more comprehensive analysis of the factors contributing to the inflation and potential long-term effects on the grocery market.
Noise Level: 4
Noise Justification: The article provides relevant information about the increase in grocery prices and its impact on consumers, as well as insights into shopping trends during the festive season. It also highlights the growth of discounters like Aldi and Lidl. However, it could benefit from more analysis or context on the long-term consequences of these trends and potential solutions for consumers.
Financial Relevance: Yes
Financial Markets Impacted: Grocery stores and food manufacturers
Financial Rating Justification: The article discusses the record high grocery price inflation, its impact on consumer behavior, and the shift towards discount retailers like Aldi and Lidl. This affects financial markets as it impacts sales for major grocery chains such as Tesco and influences consumer spending patterns.
Presence Of Extreme Event: No
Nature Of Extreme Event: Other
Impact Rating Of The Extreme Event: Minor
Extreme Rating Justification: There is no extreme event mentioned in the article, but it discusses a significant increase in grocery price inflation and its impact on consumers.
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