South Africans are opting for cheaper staples such as bread and cutting down on expensive protein options as they feel the pinch of food inflation, according to the latest findings of market research and global consulting company NielsenIQ.
The value of bread sold rose more than 33% in the four weeks ended July 8 even as inflation in the product category that includes bread increased by 14%.
“This is the third month we have seen a significant rise in bread sales indicating that consumers continue to forgo more expensive protein options in favour of cheaper staples,” NielsenIQ SA MD Ged Nooy said on Wednesday.
The report, which measures more than 80% of grocery sales in SA, is based on the sales data from 10,000 stores of Woolworths, Spar, Pick n Pay, and Checkers, as well as 143,000 independent stores and spaza shops.
Inflation remains a thorn in the side of SA consumers as prices increased by 8.1% from a year ago, leaving them with less disposal income.
The price of cooking oil jumped the most over the past year, soaring 45%, while frozen chicken is up 17%, laundry detergent 16%, bread 14% and maize meal 12%.
Consumer packaged goods sales are up 11% year on year to R527bn and increased by the same annual margin to R54bn in the four weeks to end-July 8.
However, consumers are not buying more, but paying more for less. The total basket value of sales, which excludes liquor and tobacco, grew 7.6%, but the number of units sold is down 1.1%. Consumers are also shopping less often and at fewer stores, but spend more when they buy.
SA has experienced “increased price sensitivity across multiple categories, with disloyalty growing when it comes to brand preference versus the cheapest available price”, said Nooy, adding that it will be “interesting to evaluate the role of promotions, for example, within this new shopping environment”.
The liquor sector continues to bounce back from the harsh restrictions and bans it faced during some Covid-19 lockdowns, with 30% annual growth and 25% recently, bolstered by sales of spirits.
In terms of annual sales, gin and wine are up 38%, vodka 36%, and whisky 28%, albeit off a low base. Beer remains the top seller and was up just over 20% in the past year.
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.