This past year has been difficult for consumers, with inflation driving up the prices of many everyday goods. At the grocery store, the prices of staples such as eggs, milk, and bread are up seemingly across the board and this persistent inflation is creating new buying patterns for consumers. In particular, it’s driving some customers away from high-end grocery stores and towards cheaper options like Grocery Outlet (GO), Trader Joes, or Aldi.
What’s interesting is that this trend is prevalent even among more affluent households, according to data from Placer.ai. For example, Aldi welcomed more than 1 million new households this year through September. That translates to a 10.5% year-over-year increase. Bucking the typical demo for these stores, the majority were households that earn between $50,000-$100,000 a year. Even some households that earn over $100,000 annually have started shopping at Aldi.
This just goes to show the impact of inflation on buying habits, and one of the ways in which consumers are looking to lower their spending.
The Rise of Private Label
In addition to the popularity of discount grocers, sales of private label brands are also on the rise. Private labels are in-house brands that mimic brand-name products, but at a cheaper price.
Aldi, in particular, nudges shoppers towards its private label brands by displaying them right next to brand name products. This effectively highlights the cost difference in real-time. With prices on the rise, this has proven to be an effective strategy. Other companies are following their lead. Grocery giant Kroger (KR) recently launched SmartWay, an umbrella brand which will consolidate all of its private labels under one brand.
It’s All About Differentiation
At the end of the day, grocery stores sell more or less the same products. But, to get an edge over each other, they must find small ways to differentiate themselves. Some stores like Whole Foods (AMZN) do this by offering the highest-quality foods. Others, like Aldi and Grocery Outlet, do this by offering the best prices.
As a consumer, the key is to find a grocery store that fits your diet, shopping habits, and budget. In the face of rising prices, this might be a great time to take an exploratory trip to your local discount grocer.
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How to slash your skyrocketing grocery bill
If you’re like most Americans, you’ve probably noticed your grocery bills climb to crazy heights during the coronavirus pandemic. Over the past 12 months, all of the six major grocery store food group prices increased, according to the November 2021 Consumer Price Index (CPI) from the U.S. Bureau of Labor Statistics (BLS).
Prices for meats, poultry, fish and eggs rose 12.8 percent in 2021, with beef prices jumping the most with a 20.9 percent increase. Dairy product prices rose 1.6 percent. Other prices rose too, ranging from a 4.0 percent increase on fruits and vegetables to 5.7 percent for other foods.
Leaving the grocery store with only a few bags of groceries for $100 can be depressing. Fortunately, you can take steps to lower your grocery bill by at least a little, or maybe even significantly.
Here are nine ways to cut your grocery bill despite rising prices.
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When you have a set amount you can spend on weekly groceries, that can stop you from making impulse purchases or overspending. Decide ahead of time how much you want to spend and then make sure you stay within the budget. If you’re worried you’ll go over, use your phone’s calculator to keep track of the grocery tab while shopping.
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If you haven’t signed for grocery store loyalty card programs, you’re missing out on savings. When you enroll, you’ll generally receive significant discounts on eligible items. Many grocery store loyalty programs may also offer discounts per gallon on gas.
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You don’t have to stock your cupboards with all generic or store brands, but don’t dismiss all those brands simply out of grocery snobbery. Most grocery stores offer their own quality brands of milk, eggs, pasta, toilet paper, health and beauty products and many other items for much lower prices than brand name products.
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Do you toss grocery circulars in the mail into the recycle bin without even a glance? Take a few minutes to flip through those sale ads to look for items you would typically buy that are on sale. You might find fruits or vegetables discounted for the week, meat on sale, boxes of pasta for $1 each and other items you can stock up on to use later.
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One of the best ways to save on groceries is to enter the store with a grocery list in hand. Take time to look in the fridge, freezer and cabinets so you know what you need before you go and don’t duplicate items you already have. Then sit down and write a list of grocery items, vowing to stick to your list (for the most part) so you don’t overspend on impulse buys.
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Instead of going into the grocery store with only a vague idea of what you might cook that week, plan a few meals around items that you can use in more than one dish. For example, you might prepare baked chicken and then use leftover chicken in another dish like soup, salad or sandwiches. Buy a vegetable that you can serve on the side with more than one entree.
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Did you know that higher-priced items are typically placed on shelves at eye level? That’s because many customers never lower their gaze to the bottom shelves, which often contain store brand, generic or low-priced items. Always check out the lower shelves, too. You may find a lower-priced brand you like just as much as that pricey pasta sauce you’ve been eyeing.
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It’s easy to spend too much when you pay with a credit card. But nothing keeps the grocery bill down like watching hard-earned cash leave your hands. Next time you head to the grocery store, stop by your bank’s ATM to withdraw cash first. Better yet, withdraw enough for the entire month and allocate weekly amounts to envelopes so you don’t overspend.
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Running to the store for coffee, some chips, a jar of spaghetti sauce and a block of cheese may not seem like a big deal. But if you’re making three or four trips to the grocery store a week in addition to your weekly grocery run, you’re probably spending too much.
That’s where having a grocery list helps. Give some thought to your weekly grocery list to avoid making extra trips to the store, which can include impulse purchases that raise the bill.
This article originally appeared on Debt.com and was
syndicated by MediaFeed.org.
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