The price of everyday grocery basics such as butter, milk, cheese, and bread has risen by up to 30% in the last year, according to an analysis by consumer watchdog Which?
Its food and drink inflation tracker records the cost of tens of thousands of products across three months at eight major supermarkets – Aldi, Asda, Lidl, Morrisons, Ocado, Sainsbury’s, Tesco and Waitrose. While Which? found that overall inflation in December was 15% across the eight retailers, it noted that the price of butters and spreads had jumped 29.4% year-on-year. Milk (+26.3%), cheese (+22.3%), bakery items (+19.5%), water (+18.6%) and savoury pies, pastries and quiches (+18.5%) also saw higher than average price increases.
Examples given included Utterly Butterly (500g) seeing substantial price rises at several supermarkets, including Waitrose where it went from £1 to £1.95 (95%), and Tesco’s Creamfields French Brie (200g) jumping up from 79p to £1.43 (81.6%).
The worst individual price hike on a food item across all the supermarkets was Quaker Oat So Simple Simply Apple (8x33g) at Asda, which went from £1 on average in December 2021 to an average £2.88 in December 2022 – an increase of 188%.
Across supermarket ranges, budget (+20.3%) and own-label (+18.5%) items were again subject to higher rates of inflation than premium (+12.6%) and branded counterparts (+12.5%).
Despite still being the cheapest supermarkets overall, Which? found that Lidl’s prices went up the most (+21.1%) in December, followed closely by Aldi (+20.8%). Asda had the third highest inflation but was closer to the average of 15% (15.4%).
Meanwhile, at Waitrose (+14.5%), Sainsbury’s (+13.7%), Tesco (+13.1%), Morrisons (+12.9%) and Ocado (+10.5%) inflation rose slightly less.
Which? noted that data from its latest Consumer Insight survey shows recent price rises have coincided with trust in the supermarket sector suffering a big fall, down from +67 in May 2021 to +42 now.
Trust at Aldi and Lidl tended to be lower than rivals 18 months ago but has stayed relatively the same during this period, meaning it’s now higher than average at +48 and +45 respectively. Waitrose had the lowest level of trust (+29) among all consumers, though trust levels among its customers were much higher.
Among consumers who do not trust the sector, Which? said that price rises were the most common reason, particularly the perception that prices are sometimes “artificially inflated, and go beyond what is necessary for businesses to offset their own rising costs”.
One participant in the survey told Which?: “The cost of food from supermarkets is close to unmanageable for many people, including myself. Given that large supermarkets make huge profits, I feel they could keep their prices down while we struggle with the cost of living.”
Another said supermarkets “don’t care about the consumer and charge whatever they can to make as much profit as possible.”
Which? stated that consumers’ dwindling trust in supermarkets shows that the sector could be doing a lot more to help households through the cost of living crisis. The watchdog is currently campaigning for all supermarkets to ensure that their budget line items are widely available, particularly in areas where people are most in need. It has also been calling for pricing and offers to be more transparent, with targeted promotions to support people that are struggling most with access to affordable food.
“We know food prices have risen exponentially in the last year and our inflation tracker shows the dramatic impact this is having on everyday products at the supermarket,” said Sue Davies, Which? Head of Food Policy.
“Some households are already skipping meals to make ends meet, and our findings show trust in supermarkets taking a hit as many people worry they are putting profits before the people suffering during this cost of living crisis … supermarkets must do more.”
Responding to the Which? analysis, Tesco said: “With household budgets under increasing pressure we are absolutely committed to helping our customers, by keeping a laser focus on the cost of the weekly shop. Earlier this week, we were pleased to be recognised by The Grocer as the retailer doing the most to keep prices down right now.
“So whether it’s price matching Aldi on the basics, locking the price of more than a thousand household staples until Easter 2023, or offering exclusive deals and rewards through thousands of Clubcard Prices – we’re more committed than ever to providing our customers with great value.”
A spokesperson for Asda added: “We’re focused on keeping prices on branded and own-label products in check to ensure that Asda remains the lowest-priced traditional supermarket as shown by independent research carried out by Which? Magazine.”
NAM Implications:
- In many consumers’ view, ‘Staples’ = difficult to substitute.
- In other words, consumers are being expected to absorb up to 30% price increases…
- (despite assurances that suppliers and retailers are absorbing increased costs)
- …without changing their purchasing habits.
- Realistic NAMs are factoring the implied reduction in levels of demand.
- And are not anticipating a spring-back, despite government assurances…
