Grocery Wars Part 2: Less Choices

Retailers learned their lesson following 2008 crash that controlling inventory became key to improving sales. What they did not count on was a continuing decline, not only in the purchasing power of consumers, but also the on-going decline of the middle class that began in 1980 and continues today.

Food always has been competitive with narrower profit margins than most other businesses; however, it was somewhat recession proof since consumers could forgo buying a new car or the latest fashion, but everyone has to eat, right?  However, now grocery stores have begun to control inventories beyond seasonal items and what this means for the consumer is a decline in the number and type of selections a store will carry.  Add to this natural causes such as drought, floods, and shorter growing seasons, that have increased prices substantially on beef and pork, and the consumer increasingly is being placed between a rock and a hard place.  As the middle class keeps losing ground coupled with higher prices, grocery stores are scaling back the volume and variety they offer in almost every department.

How many times have you experienced going to either a warehouse store or local grocery store for a staple that you have been buying for years, only to find that it isn’t being carried by the retailer anymore?  Are these products no longer being supplied?  In some cases, yes—some businesses have closed either through competitive attrition or retirement in family-owned businesses, but not all.  Stores are cutting back on what they consider gourmet items but also on staples if price is prohibitive and sales are limited due to the makeup of their clientele.

What this means is that many of your favorite items will be harder to find and indirectly will affect the type of meals you will be able to offer your family.  Additionally, prices will increase as competition declines.  What this means in the long run for the overall nutrition of your family is difficult to determine.

MarkdownMom does recommend increasing community gardens and individual gardens to the level of WWII Victory Gardens, and continuation of developing relationships with local farmers, local farmers markets, and learning canning and other food preservation methods.  Until the middle class starts to see signs of an economic recovery, going to the grocery store will require employing all the savvy consumer skills you have to survive sticker shock!

Size Is Important-The Ongoing Grocery Wars Part 1

Summer customarily has been a time of plenty and ease when we treat ourselves to relaxation in the sun, lazy days, and all that wonderful fresh, seasonal food!  Okay, so during this time of bounty, at the beginning of the harvest season, why are consumers paying more, but filling fewer grocery bags?

Well, several factors are at play here and one represents a significant change by manufacturers of our food that has required a major investment by them in retooling their factories and may signify a continued slow economy for some time to come.  Employing a merchandising trompe l’oeil, a fooling of the eye, manufacturers have kept prices down by reducing the contents of the individual item. Actually, this was done purposely to hide price increases since this is an inflationary action with the consumer paying the same or more,  but getting less.  Over time, this smaller sized product was incorporated into the inventory, but now every item stocked is the smaller size.  MarkdownMom recently visited WalMart and the shelves are shockingly full, row by row, with these miniature cans.

Additionally, packaged goods have reduced weights and less items included.  For instance, the consumer will pay the same price for an item as before–a good deal, right?  But instead of getting, 6 items in the package, there are only 4; instead of a dozen, there are 10.  Do the math, that’s an inflationary rate over 10%.   Meanwhile, the average consumers pay has stagnated after a steady decline beginning in the 1980’s.

It’s hard to say when this incredible, edible shrinkage will stop.  The only thing the consumer has in common with the food industry is that the $1 is worth less as well.