The latest BRC-Nielsen Shop Price Index shows that overall shop price inflation increased last month to 2.9%. an increase on May’s figure of 2.3%.

The survey covers the period 6th – 10th June and also shows that food shop price inflation rose to 5.7% in June up from May’s 4.9%.


Non-food shop price inflation went up from 0.8% in May to 1.3% in June.

Also, according to the BRC real household incomes ‘have dropped the most in 34 years’. The main drivers behind this the report says is rising fuel and energy bills coupled with low wage rises.

The survey is designed to give an accurate indicator of the inflation seen by shoppers on the 500 most commonly bought products in the most commonly shopped in stores. This is a narrower measure than the Consumer Prices Index and the Retail Prices Index hence the different results.

Although food shop price inflation is up, some 39% of the grocery spend is on promoted goods indicating that shoppers are trying to limit their losses due to inflation.

With non-food items some prices are actually lower than they were a year ago says the report, pointing to footwear and clothing as examples. This is even taking January’s VAT increase into account.

It seems that retailers are cutting prices to get the sales at the expense of their own profit margins.

The report put much of the food price increases down to ‘ …. global commodity prices and weather related supply changes’.

The senior manager of retailer services for Nielsen said ‘With shoppers indicating that they are becoming even more cautious about spending, this will impact discretionary spend further so all retailers will have to keep a focus on managing any cost price increases over the next six months’.


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