Grocery price inflation falls to single digits for first time since 2022

Kantar’s latest figures have revealed that grocery price inflation has hit single digits for the first time since July 2022. Recent figures have shown an ongoing decline in grocery price inflation during 2023, which clocked in at 11% in the four weeks to 1 October 2023.

The results also show that sales of symbols and indies grew by 4.5% for the year to 29 October 2023, from £472 million to £493m. Symbols and indies also saw a share drop of 0.1%, from 1.6% to 1.5%, despite the sales boost.

Fraser McKevitt, head of retail and consumer insight at Kantar, said: “Grocery price inflation has finally dropped into single digits after 16 months of double-digit growth, marking a big milestone for the British public and retailers.  While the drop to 9.7% is positive news and something of a watershed, consumers will still be feeling the pinch.  We’re only seeing year-on-year price falls in a limited number of major categories including butter, dried pasta and milk.”

Kantar also found that own-label lines grew by 8.0% over the last four weeks, and have grown ahead of their branded counterparts every month since February 2022, though the gap is narrowing with branded products, which grew at 6.7% over the same period.

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McKevitt added: “As we go headlong into the festive period, when shoppers typically turn more to brands.  The gap between own label and branded goods is at its narrowest since spring last year.  Branded sales increased by 6.7% in the latest month, raising the distinct possibility that they will push ahead by Christmas.”

In addition, the proportion of sales through promotions is up across every grocer versus last year – something that has only happened on one other occasion in nearly ten years.

McKevitt said: “Consumer spending on promotions has now hit 27.2% of total grocery sales – the highest level we’ve seen since Christmas last year. This is a big gear shift from October 2022 when this figure was less than a quarter.”

Co-op’s sales grew by 5.2% year on year, while discount chain Lidl was the fastest growing retailer this month, with sales over the 12 weeks up by 14.7% and share up by 0.4 percentage points to 7.6%.