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Updated: Sep. 15, 2022

Some Food Inflation Statistics

The price of groceries rose 13.5% in August, which is the largest year-over-year increase since March of 1979.

The Consumer Price Index (CPI) for grocery store or supermarket food purchases increased 0.7 percent from July 2022. All six major grocery store food group indexes increased over the span, with five of the six rising more than 10%. (Bureau of Labor Statistics' August Consumer Price Index (CPI)).

Most Consumers are Changing the Way They Shop for Groceries

The results of a survey conducted through the BuySalvageFood.com web site found that 75% of respondents have changed their shopping routine in the past few months.

Shoppers are Buying More Private Label Products

The biggest change reported by 63% of those who participated in the survey (see graph below) is an increase in the amount of private label brands they're purchasing — reducing the quantity of brand name products that they buy. The Fetch Price Index for June 2022 found that units per household for private label products increased "significantly for the first time in June," up by 12.4% year-over-year.

A private label product is one that a retailer gets produced by a third-party but sells under its own brand name. Walmart sells private label products under the names Great Value, Equate and more. A recent survey by data company Numerator found that the four most popular private label brands are Great Value (purchased by 72.7% of survey respondents), Equate (51%), Marketside (44.2%), Freshness Guaranteed (40%) — all Walmart private labels.

Private label products are often manufactured by the same companies that make the brand names most of us are familiar with. Some of Walmart's Great Value items, for example, are reportedly manufactured by General Mills, Kellogg’s, Sara Lee, Dannon, Ziploc, ConAgra and Kraft.

Consumers are Buying Less

The Fetch Price Index for June 2022 also found that:

The average grocery spend per household remains elevated, even though shoppers are bringing fewer goods into their homes.

This correlates with the findings of the BuySalvageFood.com survey, which shows that about 53% of those who participated in the survey are buying fewer snacks and treats, and 47% are buying less meat.

Interestingly, only 27% of survey respondents said that they're buying fewer fruits and vegetables. According to Fruit Growers News, fresh produce sales in June reached $6.1 billion, surpassing the record set the prior year by +1.4%. However, looking beyond the purchasing power of a dollar which has been highly affected by inflation, unit and volume declined versus June 2021. Fresh produce appears to be the least affected casualty of food inflation since shoppers continue to prepare about 80% of meals in their homes, along with a trend towards healthy snacking.

Shoppers are Switching to Cheaper Grocery Stores

Slightly more than half (52%) of those who took the BuySalvageFood.com survey said that they're shopping at cheaper stores. 32% have started to buy at least some of their groceries at Walmart, followed by Aldi (31%), local Salvage Grocery (14%) and Lidl (3%). "Other Discount Grocery" was a choice marked by 15%, and these people named Save-a-Lot, Kroger, Winco, Misfits Market (delivery), Costco and Target as some of the places they're shopping.

According to Dunnhumby’s 2022 Retailer Preference Index: U.S. Grocery Channel Edition, Aldi takes first place as being the cheapest large chain grocery store for the fifth year in a row, so it's no surprise that nearly as many shoppers are switching to Aldi as they are to Walmart, even though Walmart has 4661 locations throughout 50 states while Aldi has fewer than half that number of locations — 2190 stores — in 39 states. Lidl has only 173 stores in 9 eastern US states.

About 90% of the products found at Aldi are private label, and those products account for 77% of its total sales.

Store Brands, a company that analyses data on private labels, found that, from January to March, Aldi outperformed H-E-B, Kroger and grocery overall in the Houston and Baltimore areas. Lidl outperformed competitors like Whole Foods and ShopRite — as well as grocery overall — in the New York City and Philadelphia areas during the same period. Approximately 80% of Lidl products are private label.

Business is Booming at Salvage Grocery Stores

Salvage grocery stores sell food that’s nearing its “best by” date, food that’s beyond its “best by” date, out of season foods, discontinued items, foods in dented cans or in damaged packaging and unpopular foods that haven’t sold well. Considered “unsellable” by mainstream grocers, these items are sold in salvage grocery stores at discounted prices of up to 80%.

The biggest problem with salvage grocery stores is that there aren't enough of them and many consumers aren't aware of their existence. The majority of salvage grocery stores don't advertise and rely on word-of-mouth as the primary means of expanding their customer base.

The biggest problem with salvage grocery stores is that there aren't enough of them and many consumers aren't aware of their existence.

65% of those who took the BuySalvageFood.com survey said that they had never shopped at a salvage grocery store, and of this 65%, 3 out of 4 said that the reason was that there was no salvage grocery store nearby. Several participants noted that they have never heard of a salvage grocery store.

Despite their relative scarcity and lack of recognition, some salvage grocery stores have seen their sales increase by 100% or more in the past few months, surpassing by far the jump in sales reported by any other segment of the grocery industry.

Since most salvage grocery stores are individually owned, small “mom and pop” type businesses, there isn’t any comprehensive sales data available for analysis. The owner of Stretch-a-Buck in Sanford, North Carolina, said that his sales have more than doubled over the past year, and the owners of Mr. Mac’s Discount Grocery in New Carlisle, Ohio have also seen a 100% increase.

United Grocery Outlet, a mid-sized chain of 40 salvage grocery stores located in Alabama, Georgia, Kentucky, North Carolina, Tennessee and Virginia, has seen a sales increase of 100 to 200% year over year in 38 of its locations, according to the manager of the Norton, Virginia location, which is one of the stores where sales have tripled. Only 2 of the United Grocery Outlet locations have seen a decline in sales.

Grocery Outlet Bargain Market (NASDAQ: GO), a publicly held California based salvage grocery chain that has over 400 stores located primarily in California, Oregon, Washington, Idaho and Nevada, saw net sales surge 15.7% for the second quarter ended July 2, which follows a 10.5% increase for the first quarter ending on April 2. They have recently expanded to the east coast, opening a few stores in Pennsylvania, New Jersey and Maryland. Describing itself as the “nation’s largest extreme value retailer," Grocery Outlet offers big discounts on brand-name groceries.