Food retail turnover is stabilizing. It is true that the sector’s data shows an accumulated growth of 12.3% from January to October, but in the four weeks 41 to 44, which correspond to the month of October, the increase was only 7.6% , far from the double-digit values that have persisted since October 2022. In total, the Portuguese spent 11,314 million euros on their home purchases, 1,289 million more than last year. However, Centromarca reminds us that household purchases are declining in volume even more than during the Troika period.
“The decline in inflation means that the effect of the volume decline, which was completely disguised, is starting to become more noticeable. With the rise in prices everything seemed to grow, when in reality money was growing. [pago], but not what was sold. Now I would say that, especially until March next year, we will increasingly feel two different effects: people buy less, and even what they buy is of lower value,” says the general manager of Centromarca.
The data comes from Nielsen and covers sales, by value, of supermarkets and hypermarkets, but also of supermarkets and small businesses, information that Pedro Pimentel supplements with figures from Kantar, supported by purchases made by a panel of households, and that so far In September, they recorded a cumulative volume decline of 9% since the beginning of the year. “It’s a brutal drop. Compare with Troika-era figures and between 2012 and 2014 we had a 5% drop, which was much more visible because we didn’t have inflation to mask the numbers at the time.” he explains. But there are other factors that help ‘mask’ this situation, such as the growth of tourism, which is ‘much stronger’ today than in 2014, ‘which causes sales and cash outflows from supermarkets – to restaurants and cafes or for tourists themselves – hide this number”.
To better understand the magnitude of this decline, Pedro Pimentel recalls that the variation in volumes purchased by households normally varies between 1 and 1.5%, both up and down. “A drop of 9% in a very short time means that not only did people have to take measures a bit violently, but that these measures were taken not only in the quantity of what they buy, but also in choosing cheaper products,” refers .
However, the person responsible believes that the fall may have already finally come to an end. “There is still no recovery in consumption. There is a clear sign here that the decline is likely to have bottomed out and that we are now in a phase of some stabilization for later when people feel that their economic and purchasing power has recovered. Something, they can also recover the way they do their shopping,” he argues. However, he admits that everything depends, as always in these matters, on the development of the national and international economic situation , recalling that an external focus is enough to raise oil prices and complicate all these accounts.
Returning to the Nielsen figures: of the 11,314 million euros remaining in food retail, 40.4% went to groceries, 17.6% to dairy products and 7.8% to frozen products. Compared to the first ten months of 2022, spending on groceries has increased by 13%, and further by 16% and 15% for dairy and frozen products, respectively.
Products from distribution brands, the so-called ‘white brands’, represent 44.3% of the sector’s total sales value this year, compared to 40.1% a year ago. And it is in food that we see how much families prefer cheaper distribution brands than those of manufacturers. The share in value of white label groceries increased from 47.5% to 51.1%, from 41.5% to 46.4% in dairy products and from 56.6% to 62.1% in frozen products.
In a market growing at 12.3% and worth 11,314 million euros, manufacturer brands are growing by 4.5%, while distribution brands are growing by 24% compared to 2022.
Ilídia Pinto is a journalist for Dinheiro Vivo
Source: DN
