Due to persistent food inflation, U.S. shoppers are less likely to find deals: the frequency and depth of discounts remain below 2019 levels, reports The Wall Street Journal.
Between July and September of this year, an average of 20.6 percent of food and drink products were sold with price reductions, down from 25.7 percent for the same period in 2019, according to Information Resources Inc. Across all categories, with the exception of meat, promotions are down.
Food makers cite ongoing shortages and supply chain issues that have limited their product supply, leaving fewer to be put on sale. Although the onus usually falls to makers to provide funding to support discounts, supermarkets are left to pay for the discounts, according to the report.
Kosta Drosos, general manager of Fresh Market Place in Chicago, said the specials the retailer runs now tend to be small, and don't include staple items. He also indicated that the grocer is still absorbing losses from promotions from Labor Day weekend sales.
To fund promotions, manufacturers usually pay between 15 to 18 percent of sales, explained Jim Hertel, SVP at Inmar Intelligence, a research firm. For retailers, promotional offerings tend to be a dependable way to encourage customers to spend more.
Kraft noted that the company’s discounts have not returned to 2019 levels, and that it's focusing its data analysis efforts toward “productive” sales.
Albertsons expects promotions to stay low through the end of the year. Full Story (Subscription Required)
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