The fiasco in the ‘French-style’ agreement and 16% inflation in food have triggered the change of habits
The VAT reduction approved by the Government for certain basic foods has not yet been transferred to the ticket and, after months of inflationary crisis, the turnaround in certain consumption habits seems to have consolidated. The deal fiasco French in Spain, where the Executive has no interest in promoting an agreement with supermarkets to offer an anti-inflation shopping basket, has led to families to create their own cheap basket.
Price has become a determining factor in the decision-making process in the supermarket. If it was before, it is even more so in a context of food inflation above 16%. And faced with this scenario, the distribution chains have decided to strengthen their white label to retain customers in a highly competitive sector in which offers of baskets with basic products at reduced prices have only been launched in isolated cases.
“Customers are consuming more and more white-label products, since they identify levels of quality that are as demanding or more than in other manufacturer brands, but at a much cheaper price,” explains the man to EL MUNDO. CEO of Aldi Spain, Valentn Chandeliers. 86% of their products are their own brand, which allows them to “offer with guarantees” the “best quality” and “at a competitive and attractive price for customers”.
“The distributor’s own brand is a claim because it is cheaper than the manufacturer’s brand and moves with high quality standards,” sources in the sector corroborate. Consumers have detected this way to save and this is translating into a sharp increase in these products in the shopping cart, to the point that they already exceed 40% of sales in value.
This is confirmed by a recent study by the Kantar consultancy, which interprets that distribution is reacting to the current price crisis “pushing its own brand to defend its market share”. This strategy is not trivial, in a context in which the consumer is less and less loyal to brands and establishments and is more willing to move in search of better prices and promotions.
The report, prepared by Kantar for the Department of agriculturealso shows that the shopping cart has been reduced in volume, since customers fill it less to control spending, and it has varied in content, with less fresh food, such as meat, fish, vegetables, and vegetables, in favor of the most economical and durable frozen products.
In the analysis, which was presented by Luis Planas’ team to the representatives of the food chain at the last observatory, the consultancy reveals that in the first weeks of March the price of food increased by more than 13% as a whole. . That is the reference available to the Government before knowing the final CPI data in the middle of this month.
If this trend is transferred to the INE statistics, food inflation will fall compared to the previous month and, although it will continue to be high, it will validate the government theory that food prices have already peaked and now begin the downward path. Although it must be taken into account in the analysis of the March data that a base effect occurs that distorts the real annual rise when compared to the start of the war in Ukraine.
Food under surveillance
All in all, the Government continues to explore different ways to appease inflation in the shopping basket. After the economic vice president, Nadia Calviowill urge farmers and ranchers to transfer the reduction in energy costs and the public aid received to the following links, Agriculture agreed with the representatives of the chain to set up several working groups to monitor the costs ‘from the field to the table’ of some foods.
Specifically, the reports of the value chain of the extra virgin olive oil and packaged liquid milkand specific reports of peaches, nectarines, potatoes, tomatoes, citrus and honey. These are descriptive studies of the set of costs involved in each marketing stage through which a food passes from its harvest in the field to the table and are key to understanding the price setting process and favoring transparency in the publication of prices. the costs.
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