UK grocery inflation has surpassed Ireland which currently stands at 16.7%. The key areas that are driving the growth is predominately inflation as volume per trip fell by 13%.
The latest 12 weeks to 23rd January 2023 see grocery sales increased by 6.8%. Shoppers spent an additional €90.50 per household year on year.
New year health kick
Despite price pressures, shoppers continued to embrace the new year health kick. Turnover increased in categories that filter into the new year health kick. Non-alcoholic beverages grew at 4.6%, with 5% of Irish households purchasing non-alcoholic beverages during January. Continuing the trend from the previous month, shoppers spent an additional €848,000 on mineral supplements and vitamins.
Dunnes holds top position
All retailers saw growth in the 12 weeks to 23rd January. Dunnes have the top place in the retail market with 23.7% with a 10.3% growth year-on-year. Lidl have the strongest year-on-year growth of 9.9%.
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Key insights for a food and drink producer
The importance of own label products
Own label products continue to show strong growth. Consumers are feeling the effects on spending post-Christmas. Shoppers continue to trade down to own branded products with sales rising 10.4% compared to brands which grew at 4.7%. Premium own label products saw a growth of €5.7m year-on-year. Strong growth in premium label are chilled premium ready meals, which grew 11.6% over the latest 12 weeks. Value own label products saw the strongest growth and is up 34% year-on-year. Inflationary pressures are impacting consumers habits and decisions. It is essential to review your product positioning within the market.
Online sales continued to grow with a 5.6% increase year-on-year growth. Kantar states ‘nearly one in five Irish households now purchasing online’. This route to market is growing and should be reviewed as part of your retail strategy to ensure continued success within your business. If you currently have an online presence its essential review your website, is it fit for purpose? Is it easy for potential customers to purchase products?
As inflation continues, it is important to review your price position within the market. Ensure you have your strategy correct and understand your competitive landscape. Consumers will continue to compare prices and value for money. Correct retail pricing will enable you to continue to drive growth and sustaining a profitable business.