Spending on essential items accelerated, in September driven by grocery shopping and rising fuel prices according to a report out this morning from Barclay’s
Bars, pubs & clubs also had a positive month, likely due to sports fans gathering to watch the Rugby World Cup
The report found that more shoppers are noticing signs of “shrinkflation”, and two thirds believe that supermarkets should put warning labels on products that have reduced in size
Consumers,the report found are on the lookout for “surge pricing” – almost half have noticed companies raising prices during peak times
Spending on essential items grew 4.6 per cent, considerably higher than last month and was largely due to an upswing in fuel spend driven by rising petrol and diesel prices.
While food price inflation has eased in recent months, more consumers said they were finding ways to reduce the cost of the weekly shop.
Of this group, almost half are buying budget or own-brand goods over branded goods in supermarkets.
A further 52 per cent of adults are taking advantage of multibuy deals, bundle offers and/or buying items in bulk to reduce costs.
Almost half of those cutting back on grocery spending are now using vouchers or loyalty points to obtain money off at the check-out, while two fifths are shopping at multiple supermarkets to source a range of deals.
However, many Brits are questioning whether these offers provide the best value for money.
Two thirds of shoppers believe that supermarkets inflate the regular price advertised for some products, so that the promotional prices offered through their loyalty schemes look like a better deal than they really are.
On the other hand, 40 per cent have noticed supermarkets helping customers during the rising cost-of-living by cutting prices on certain items.
Fruit and vegetables,bread and tinned food are among the top items Brits have noticed price cuts on.
A higher proportion of consumers noticed examples of “shrinkflation” with chocolate remaining the most cited product impacted by this trend.
This comes as nearly six in 10 say they’ve noticed that some products have changed their packaging in order to disguise a product inside is smaller or weighs less, while 68 per cent believe supermarkets should put labels on products informing customers when they have shrunk in size/weight without the price being changed.
As shoppers become increasingly cost-conscious, close to half have noticed more examples of “surge pricing”; where companies raise the prices of products and services during peak times, or when demand is higher.
Of those who have spotted this growing trend, one in three has seen an increase in the price of food and drink in pubs and bars during peak times, such as evenings, weekends and during major sports events.
While some pubs and bars may be charging more when trade is busier, only one in 12 consumers say they are willing to pay more to eat and drink out at popular times. Those who are happy to pay “surge prices” are prepared to spend an average of 70p more for a pint of beer and an additional 60p for a glass of
Meanwhile, the rising cost-of-living continues to impact spending on restaurants, which saw further decline in September
This comes as 44 per cent of Brits said they are planning to reduce in discretionary spending over the next couple of months to save money for the upcoming festive period, with eating out at restaurants the most frequently cited cutback.
Seasonal savers are also planning to row back on food deliveries which may explain why the growth in spending on takeaways and fast food remained flat
One of the reasons for these Autumn savings is that two in five Brits say they expect that this coming Christmas/festive period will be more expensive than last year.
To help spread the cost, a fifth has started to buy presents already, while 18 per cent have spoken to loved ones to make a mutual agreement to cut back on gift-giving.
Esme Harwood, Director at Barclays, said:“Grocery spending tapered off over the summer, thanks to the long-awaited drop in food price inflation. Worryingly, growth sped up again in September, which could be an early warning sign that food prices may not come down as quickly as we’d hoped.
“Eagle-eyed shoppers have spotted more examples of “surge pricing” and “shrinkflation”, and are becoming sceptical about the value of supermarket loyalty schemes. Consumers are also starting to pull back their spending in some non-essential areas, so that they can put more money aside for the festive season.”
