Supermarket: Sales losses of 1.4% in the aftermath of accuracy and reduced consumption

By George Lampiris

Rising prices, along with declining demand, are key features of fast-moving consumer goods (FMCGs) sold in supermarkets in the first quarter of 2022. According to Nielsen IQ data, the above two factors cause a negative trend. in sales both in volume and value. According to the measurement company’s record, this reduction, in addition to the rationalization of consumption, is probably due to the effort of consumers to reduce their spending in the super markets, as well as the wider inflation and the large price increases, which have occurred in other categories. products and services, such as energy, fuels, etc., seem to have reduced to some extent the purchasing power of consumers, even for the basic categories of essential goods.

Losses of 1.4% in sales value in organized food retail

Thus, as a whole, the organized food retail market in the first quarter moved negatively in value, to -1.4% in the first quarter of 2022 (YTD data until March 27, 2022), compared to the corresponding period of 2022, a trend driven by fast-moving consumer goods. It is characteristic that the large categories of fresh food, but also of Bazaar products (clothing, footwear, electrical, household items), show much more moderate trends, at -0.3% and + 0.8% respectively compared to the first quarter of 2021.

The sub-categories of fast-moving consumer products, food and beverages show a more moderate negative trend, at -1.2%, as food holds the whole category. On the contrary, drinks, and especially alcoholic beverages, are more strongly negative. The second large category, namely personal care products and the third large category of household products show a decrease in their sales in value compared to the corresponding period of 2021 by -3.5% and by -4.8% respectively . In essence, their consumption is being rationalized, following their sales surge in 2020, given the growing demand for antiseptics, wipes and household cleaners, which for many have served as a “refuge” to deal with the pandemic.

Consumer concerns about rising prices

What is also being recorded is consumer concerns about prices, as it feels more than ever that they are on the rise, with a clear increase in the percentage of those who report it (from 72% to 92%) in NielsenIQ’s annual survey of Shopper Trends. Indicative of the above is the fact that the course of the share of private label products has now been reversed and is moving upwards, reaching 14.2% in the first quarter of 2022 (excluding Lidl). Private label products are an alternative for many consumers, being cheaper than branded ones.

Rising bids and fierce competition to keep up

This particular strengthening trend for private label products started in mid-2021 and after, when general inflationary trends began to appear in the market. This is despite the fact that the promotional intensity (discounts, products 1 + 1, etc.) for branded products has been further enhanced, which has reached 64.6%. The specific movement of intensity of offers on the shelves of supermarkets is interpreted as an attempt to keep prices both from suppliers and from different retail chains, within the very competitive environment in which they operate.