Spending on essential items experienced a significant growth of 4.6% in comparison to last month’s 1.0%. This notable increase can be largely attributed to a rise in fuel spend, which saw a decrease of only -10.9% compared to the -20.1% in August. The surge in fuel spend can be attributed to the escalating prices of petrol and diesel. Furthermore, there was a noteworthy 7.0% uplift in spending on groceries, surpassing the growth observed in August (4.5%).
Despite a recent easing in food price inflation, a higher percentage of consumers in September (70%) expressed their efforts to reduce the cost of their weekly shop, as compared to August (67%). Within this group, almost half (49%) have opted for purchasing budget or own-brand goods instead of branded products at supermarkets. Additionally, 52% of adults are taking advantage of multibuy deals, bundle offers, and bulk purchases to effectively reduce costs.
Among those who are cutting back on grocery spending, almost half (47%) are now utilizing vouchers or loyalty points to obtain discounts at the check-out. Additionally, two-fifths (41%) have resorted to shopping at multiple supermarkets in order to secure a wider range of deals.
However, many British consumers are skeptical of the real value for money offered by these promotions. A significant proportion of shoppers (67%) believe that supermarkets inflate regular prices of certain products to make their promotional prices, offered through loyalty schemes, appear more enticing than they actually are.
Conversely, 40% have taken note of supermarkets aiding customers in coping with rising costs by reducing prices on select items. Notable examples of products that have seen price cuts include fruit and vegetables (33%), bread (23%), and tinned food (22%).
The month of September observed an increased number of consumers (76%) noting instances of “shrinkflation” compared to August (71%). Among these instances, chocolate (48%) remains the product most commonly impacted by this trend.
In light of these developments, nearly six in ten consumers (59%) have recognized that certain products have modified their packaging to conceal smaller or lighter contents. Moreover, 68% of individuals firmly believe that supermarkets should be obliged to label products that have reduced in size or weight without a matching price reduction.
Esme Harwood, director at Barclays, warned, “Grocery spending experienced a slight tapering during the summer following the long-awaited drop in food price inflation. Unfortunately, growth has accelerated once again in September, serving as an early indication that food prices may not decrease as swiftly as expected.
“With eagle-eyed shoppers spotting more instances of ‘surge pricing’ and ‘shrinkflation,’ and growing skepticism surrounding the actual value of supermarket loyalty schemes, consumers are now cutting back spending in some non-essential areas to allocate more funds towards the upcoming festive season.”