In the United Kingdom, grocery price inflation has reached a new record high of 16.7%, adding about £800 to the average yearly grocery expenditure, with milk, eggs, and dog food experiencing the greatest price increases.
In the four weeks leading up to January 22, according to retail researchers Kantar, inflation reached its highest level since the company began tracking it in 2008. It was a significant increase from December’s 14.4%, which pushed Christmas spending to a record £12.8bn and surpassed the October record. According to Kantar, the latest hike would bring the average annual food shopping bill to £5,504, up £788.
The monthly survey also revealed that sales of alcohol-free and low-alcohol beers increased by 3 percent year-over-year as a result of the popularity of dry January. Veganuary also had an effect, as sales of supermarket private-label plant-based or vegan products increased by 21%.
Overall grocery sales increased by 5.7% year-over-year over the four weeks and by 7.7% in the 12 weeks leading up to January 22.
Fraser McKevitt, the head of retail and consumer insight at Kantar, stated, “Late last year, we observed a minor decline in the pace of grocery price inflation, but this reprieve for consumers has been short-lived. If households do not alter their spending habits, their annual shopping expenses will increase by £788.”
UK grocery price inflation rises to record £788 per year
To offer customers value in the face of record inflation, supermarkets have increased their own-label product lines. In January, sales of private-label products increased by 9.3%, while sales of branded alternatives increased by only 1%.
McKevitt stated, “Across the market, there is a shift toward everyday low prices, with many supermarkets giving price matching and utilizing loyalty programs to help consumers save money. This month, the proportion of expenditure on promotions has dropped to its lowest level since at least 2008, exacerbating the typical post-Christmas decline in offers.
In January, slightly fewer than 3.4 million consumers purchased plant-based or vegan items, compared to 3.5 million the year before. New limitations on high-sugar, high-salt, and high-fat foods and beverages may also be having an effect, as £10 million less was spent on chocolate bargains in January compared to the previous year.
For the fourth consecutive month, the German discounter Aldi was the fastest-growing grocery store, with sales up 26.9% year-over-year and a 9.2% market share. Lidl’s sales increased by 24.1%, resulting in a 7.1% market share. Their larger competitors Tesco, Sainsbury’s, and Asda grew sales by approximately 6%, whereas Morrisons sales decreased by 1.9%.
