Australian shoppers shift to cheaper goods amid multi-decade high inflation

Woolworths' biggest competitor, Coles, painted a similar picture in their end-of-year results

consumer segment
Australian shoppers shift to cheaper goods amid high inflation
IANS Canberra
2 min read Last Updated : Aug 25 2022 | 2:35 PM IST

As Australians struggle with an ongoing multi-decade high inflation, the nation's largest supermarkets have begun to notice shoppers moving towards cheaper goods.

Alongside their end-of-year results released on Thursday, CEO of Australia's largest supermarket chain, Woolworths, Brad Banducci, said consumers were beginning to shift their spending towards cheaper goods.

"Inflation is beginning to impact all aspects of our customers' shop and we are seeing a gradual change in customer shopping behaviour," said Banducci.

"We are seeing some customers trade down from beef into more affordable sources of protein and trade across from fresh vegetables into more affordable frozen and canned offerings."

For instance, canned tomatoes ring up at a fraction of the cost of fresh ones -- A$2 per kig versus over A$15 per kg.

The company's financial results noted that average prices in the three months to the end of June rose by 3.6 per cent, an indication that food prices are moving faster than the headline inflation rate of 6.1 per cent in the year to June as recorded by the Australian Bureau of Statistics, the highest level since the early 2000s.

Woolworths' biggest competitor, Coles, painted a similar picture in their end-of-year results.

The report said that shoppers were shifting away from fresh fruits and vegetables, expensive cuts of meat and name-brand goods, and opting for frozen goods, cheaper sources of protein, and the supermarket's cheaper own-brand products.

"The need for the Group to evaluate and respond quickly to a changing operating environment has never been more important as we focus on ensuring value for customers in an inflationary environment," said Coles Group Chairman James Graham.

Both companies attributed the inflationary levels to global supply chain pressures, rising transport costs, and local factors such as flooding which has spurred sharp price increases on impacted local produce.

The supermarkets have implemented a "price freeze" on staples in a bid to keep customers engaged.

Coles locked the prices of more than 1,100 everyday goods, and Woolworths on over 400 items.

Both the supermarkets ultimately posted growth in sales. Woolworths sales grew by 4.5 per cent in the 2021-22 financial year, and Coles posted an increase of 2 per cent.

--IANS

ksk/

 

(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

Subscribe to Business Standard digital and get complimentary access to The New York Times

Quarterly Starter

₹900

3 Months

₹300/Month

SAVE 25%

Smart Essential

₹2,700

1 Year

₹225/Month

Save 46%

Super Saver

₹3,900

2 Years

₹162/Month

Subscribe

Renews automatically, cancel anytime

Here’s what’s included in our digital subscription plans

Access to Exclusive Premium Stories Online

  • Over 30 behind the paywall stories daily, handpicked by our editors for subscribers

Complimentary Access to The New York Times

  • News, Games, Cooking, Audio, Wirecutter & The Athletic

Business Standard Epaper

  • Digital replica of our daily newspaper — with options to read, save, and share

Curated Newsletters

  • Insights on markets, finance, politics, tech, and more delivered to your inbox

Market Analysis & Investment Insights

  • In-depth market analysis & insights with access to The Smart Investor

Archives

  • Repository of articles and publications dating back to 1997

Ad-free Reading

  • Uninterrupted reading experience with no advertisements

Seamless Access Across All Devices

  • Access Business Standard across devices — mobile, tablet, or PC, via web or app

More From This Section

Topics :InflationAustraliahuman behavior

Gold price in Delhi today is ₹ 84,470, Click Here for other cities. Silver price in Delhi today is ₹ 84,470, Click Here for other cities.

First Published: Aug 25 2022 | 2:35 PM IST

Next Story