Supermarket prices have been on the rise, with the cost of chilled soft drinks, chocolate confectionery, and skin care products seeing the most significant increase. According to recent data from analysts Kantar, grocery price inflation has edged up by 2% in the past year. In September, households were seen turning to promoted items to manage their finances, leading to a 2% increase in supermarket prices compared to a year ago.
Households responded to the price hikes by increasing their purchases of promoted items by 7.4% while full-price sales only rose by 0.3% during the same period. Overall take-home sales across various grocery stores saw a 2% increase in the same timeframe. The latest figures show that prices are rising most rapidly in categories such as chilled soft drinks, chocolate confectionery, and skin care products. However, the average prices for toilet and kitchen roll are 6% lower year-on-year, and dog and cat food prices have decreased by 4% and 3%, respectively.
The head of retail and consumer insight at Kantar, Fraser McKevitt, noted that supermarkets are striving to keep costs down for consumers amidst fierce competition in the retail sector. The report also highlighted that the unusually wet weather in September led to a surge in hot chocolate sales by 28%, soup by 10%, and home baking by 7%. Additionally, Halloween pumpkin sales nearly doubled compared to the previous year, reaching just under £1 million in the last four weeks.
As consumers continue to feel the pinch on their finances, a survey found that more people are struggling to balance environmental concerns with their own financial worries. The survey revealed that 59% of Britons are finding it harder to act sustainably, up from 44% the previous year. In terms of market share, Tesco has gained its largest annual share since December 2017, claiming 28% of the market. Ocado has been the fastest-growing grocer for the eighth consecutive month, with a sales increase of 10% over the latest 12 weeks.
Other notable trends include an 8.8% increase in spending at Lidl, which now holds 8.1% of the market share, and Aldi’s sales accounting for 9.8% of total spending across different grocers. With supermarket prices on the rise, consumers are facing challenges in balancing their budgets while trying to make sustainable choices. As the retail sector remains highly competitive, the battle for value continues to influence pricing strategies and consumer behaviours.