Overall squeeze on many monthly budgets continues despite the falling inflation and consumers are cutting back spend through seeking out cheaper brands, highlights a recent industry report.
According to KPMG’s quarterly Consumer Pulse, more than one in five (22 per cent) of those surveyed said they switched to cheaper options when buying frozen food in 2024, 20 per cent said they had done so with fresh produce, 10 per cent said they had done so with alcohol and 12 per cent said they had done so with non-perishables.
Overall, 32 per cent of consumers reported that they are buying more discounted or promotional products, 31 per cent said they were buying fewer items, and the same percentage said they were buying more own-label goods.
A fifth said they had switched brands on frozen foods, fresh produce, and clothing, respectively. Overall, the scale of essential cost pressures has even seen 5 per cent of consumers reporting that they have reduced their monthly non-essential spending by over £200 compared to when 2024 began.
Commenting on the findings, Linda Ellett, UK head of consumer, retail and leisure for KPMG, said, “Our research clearly indicates that many households have had to continue to find ways to cut non-essential spend so far this year, with some making sizeable cuts as they adapt to or prepare for significant cost hikes, such as a remortgage or rent increase.
“Slowing inflation does not mean that consumers are seeing a reduction in prices and costs, and the overall squeeze on many monthly budgets continues. Consumers are cutting back spend through seeking out cheaper brands or promotional offers, buying fewer items, and by restricting the everyday treats such as eating out.
Ellett added, “As we head toward the election, many households are still adapting to higher costs, consumer confidence and feeling of financial security are clearly divided, and there remains limited appetite to make major purchases. This is the landscape facing the next government as they develop their future economic policy.”
