Most food shoppers in The United States, Canada and Europe would agree that food is becoming more expensive and that they are choosing what and where they buy based on price. Some who are finding it all too much are actually patronizing food banks and sitting down to meals cooked by charities.
Meat Only for Special Occasions
Patricia Norris of Romeo, Illinois told Reuters' Nicole Maestri in an April 4, 2008 interview that she could no longer afford to buy beef and chicken regularly. "We buy meat only for special occasions. Like for Easter we had ham." She arms herself with a detailed shopping list before entering the store and cannot afford any impulse purchases.
However you cut it, in many instances, there is no longer any particular allegiance to any product or store. If the price is right, people are more likely to buy cheaper brands than they used to. Moreover, they are just as likely to buy their fruit and vegetables at a big box or drug store as in a supermarket produce aisle.
Many major food manufacturers see what is happening and are falling back on reinforcing their products' branding, although experts say this is a waste of time in an economy on a budget.
More Store Brands
Some supermarkets are intent on fighting back by introducing more store brands, opening pharmacies to try for the prescription dollar and teaming up with caterers to present a reinforced image of customer service. The idea is to position themselves as neighborhood stores rather than as part of a chain.
The big problem for supermarkets is not only the advent of the big box store, but the slow encroachment on their territory by pharmacies. Time was one went to one to buy toothpaste, now it's just as likely to be to buy breakfast cereal.
Lower Food Prices
Will all this competition result in lower food prices? Well, in the United Kingdom there appear to be almost constant price wars between Asda, Sainsbury and Tescos and, in Canada, Loblaw, the country's largest supermarket chain, has taken a chain saw to a large percentage of prices in its stores in Eastern Canada and will, most likely, do a little tinkering elsewhere. However, food is getting more expensive everywhere in the world as droughts and floods affect crops, fish and livestock.
One must not forget the elephant in the room for supermarkets as well as food manufacturers and distributors; Wal-Mart, Target and Costco- the big box stores that seem to be able to undercut everybody. In the short term, their policies will help beleaguered shoppers but, if the competition dries up, then all bets are off. Right now, nobody is predicting how the situation will play out.
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