2023 will be tough but there is hope that things may improve in 2024, says a industry specialist citing latest forecast from IGD, adding that local retailers can prosper in times of economic hardship as shoppers opt for "little and often" shopping.
According to Sarah Coleman, TWC’s director of communications, food inflation will continue to rise in the months ahead, peaking at 17 per cent to 19 per cent in Q1 2023, followed by a gradual decline.
“A significant factor in the current high inflation we are experiencing is a lack of supply and unfortunately, we can expect this to continue due to the war in Ukraine and the ongoing implications of Brexit.
“Most recently we’ve seen this affect availability of eggs; and we’re also facing emerging challenges such as bird flu impacting the availability of our Christmas turkeys,” she said.
Coleman further adds that many data sources suggest that consumers plan to spend less this Christmas and retail predictions indicate an anticipated decline of 3-4 per cent.
“We know that people can’t help treating themselves, especially at Christmas time and so one of the ways consumers are managing this is to have started the planning earlier this year, as well as taking advantage of interest free credit and the likes of Klarna, to spread out the cost.
Coleman added that she feels that hopeful for convenience stores as they “generally hold up well in recessions”.
“Little and often” shopping minimises waste and provided retailers have a strong value proposition, they can prosper in times of economic hardship.
Data from TWC data partner Mealtrak confirms that there has been a slight drop in foodservice occasions and it is doubtless that the value end of the market will hold up better as consumers reduce spend on eating out. Operators across the spectrum will call on their entrepreneurial spirit and resilience, which has been necessary through the “permacrisis” of the last few years.
