Savvy shoppers saving money on groceries

Shoppers are switching to more economical bulk purchases, favouring cheaper frozen foods over fresh, and downsizing their luxury purchases as high inflation swells grocery bills, according to consumer insights company IRI.

Inflation is running at 7.3%, the highest rate in 32 years, as the war in Ukraine and the Covid-19 pandemic disrupt global supply chains and push up prices. Households are feeling the pinch and IRI has launched a quarterly inflation-impact tracker to give retailers and manufacturers insights into consumer behaviour.

‘‘There’s no blueprint for this environment,’’ IRI New Zealand managing director Craig Irwin said. ‘‘There’s just so many things happening at once that don’t usually happen together.’’

Groceries were getting expensive and consumers were responding by managing what was in their trolley to try and minimise price shock at the checkout, he said.

Earlier in the pandemic, shoppers tended to trade up to a more premium option if the product they wanted was not in stock. However as budgets tightened, they were shifting to more affordable options like supermarket brands.

Shoppers were also ‘‘buying larger pack sizes, shopping at multiple locations to get the best price and in some cases, going without if the product they want is not in stock or becomes too expensive’’.

People were also buying smaller amounts of more expensive items.

Irwin said manufacturers had to be transparent about shrinking package sizes or risk getting called out by consumers.

Seasonal bad weather was another factor pushing up the price of fresh fruit and vegetables and consumers were switching to more affordable frozen alternatives.

People were also either cutting out meat or switching to cheaper options like sausages and mince rather than steak, and dropping some ingredients such as capsicum from their recipes if they were too expensive.

Still, Irwin noted that while many were impacted by the Covid19 pandemic, not all consumers were doing it tough.

‘‘There’s a bunch of people who weren’t really impacted by Covid – their careers and jobs were safe and their income was safe, but they weren’t able to spend a lot of that money on the things they normally would like holidays and travel, and they’ve still got a bit of money to spend,’’ he said.

That meant there was still demand for luxury products.

Manufacturers had consolidated their ranges to focus on the biggest-selling products as they faced supply constraints but those pressures may be starting to ease, Irwin said.

He expected the current inflationary conditions may last into the first half of next year before returning to a more normal environment.