Aliens might invade Earth or wars could break out, but even during all this we need to eat. And this is why food inflation is currently public enemy number one. With food prices rising, the average American household has struggled to keep food on the table. To make matters worse, workers have been hit by layoffs and a volatile economy.
A worldwide inflation incline began somewhere in mid-2021 with 2022 seeing the worst on record. In the US, inflation reached a four-decade high and its effects were compounded by the lack of pay hikes and rising prices.
So, how has food inflation affected the average consumer? Has there been any change in consumer habits and what are its repercussions?
In this piece, we will delve into the effects of inflation on food and families, and what it means for the health of the community.
The effects of food inflation
Food inflation has changed everything from shopping habits to health consciousness for most Americans. While most people had started watching what they put into their mouths during quarantine, with food prices rising, priorities have quickly changed to “what we can afford to eat.”
In the last one year, overall food prices have risen by almost 10%.
Frozen foods consumption
According to Amy Crew Cutts, economic consultant to Primerica, high inflation has been especially painful for middle-income American families.
More and more households are turning to frozen food products, as they are cheaper and easily available. Adnan Durrani, CEO of Saffron Road, a company that manufactures frozen food, told Yahoo Finance last year that the brand broke multiple records in 2022.
The frozen food category outgrew the fresh one by 230% by mid-2022 and that there has been a dramatic shift in consumer buying habits.
Frozen and canned foods are also preferable as they last longer and there is little to no waste. They also save time and are often price-advantageous when planned properly.
As household budgets shrink, people are conscious of wastage and food habits. In such situations, frozen foods keep grocery bills low and help reduce waste.
Dollar store shopping
Another surprising change has been the rise in grocery shopping at dollar stores. There is no longer enough bandwidth in the budget to plan for week-long dinners and lunches.
The findings from Coresight Research show that more than one in five consumers have started buying groceries from dollar stores. Instead of heading to supermarkets, conventional grocery retailers, or other big stores, people are frequenting dollar stores as they offer fresh food at low prices.
For most consumers, it is about getting the biggest bang for their buck as they battle food inflation. Chains like Dollar Store and Dollar Tree have recognized the change in consumer behavior and started building infrastructure to expand their grocery offerings.
The report stated that “If the two retailers continue to improve the quality of their fresh food while maintaining the low prices associated with their brands, there is a high chance it will bolster their value proposition with their existing consumer base and also pull in new customers from higher-priced retailers.”
With food prices rising, the average American is on the lookout for alternatives. Although they might find lesser variety, experts advise checking expiration dates before stocking up on groceries that are cheaper.
How to save money during food inflation?
Cost comparison – It is important to compare prices between different stores before deciding to make a purchase. As inflation eats into budgets, remember to do your research before opening your wallet.
Do not shop on an empty stomach – Experiments have pointed out that people tend to buy more when they are hungry. Therefore, it is important to make sure you are not running on empty when you find yourself amidst shelves lined with easy pickings.
Buy in bulk – It is best to plan your meals in advance. This will allow you to meal prep and buy things in bulk, increasing your savings. It also helps you avoid the stress of wondering what to make next.
Use cashback apps/ cards – Take advantage of the offers provided by fintech apps and your bank. Using the right app or credit card could be the difference between no savings and saving up to 6 to 10% on your next grocery run.
Many economists continue to expect 2023 to slip into a recession. With tech companies continuing layoffs, the average household has struggled to rein in their spending as high inflation and job losses compound their worries.
Most families are aware of the risks that lie ahead and are changing their shopping habits to reduce its impact on their financial future.
