Grocery prices 'up 20 per cent in two years' and shoppers offered fewer discounts

21 May 2022, 07:53 | Updated: 21 May 2022, 07:55

Consumers have seen the price of hundreds of popular grocery items rise by more than 20% over the last two years alongside a drop in supermarket discounts and budget ranges, a study has found.

Which? found that the price of 265 groceries soared by more than a fifth at the same time as the availability of supermarket discounts and budget ranges - upon which consumers are increasingly relying - fell.

The watchdog analysed the prices of more than 21,000 groceries over two years, comparing their average prices at eight major supermarkets between the start of December 2021 and the end of February 2022 with the same period two years previously.

Items included Kellogg's Crunchy Nut Corn Flakes Cereal 500g, which increased by 21.4% at Tesco, Asda's 250g Own Label Closed Cup Mushrooms, up 21.4%, and Cathedral City Extra Mature Cheddar 350g, which rose by 21.1% at Ocado.

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Across 20 categories of groceries, fizzy drinks saw the biggest average price rise at 5.9%, followed by butters and spreads (4.9%), energy drinks (4.8%) and milk (4.6%).

Groceries with the lowest inflation included chocolate (1.4%), fresh fruit (1.6%), biscuits (1.8%) and vegetables (1.9%).

The study also found that across different supermarkets there have been fewer discounts, limited availability of own-label budget ranges and products decreasing in size but remaining the same price over the same period.

The number of promotions fell across every one of the 20 categories the watchdog studied, including the number of discounts on bottled water down 14.7% and on vegetables down 11%.

Meanwhile, the size of savings in promotions that did still happen were also cut in three-quarters of the categories. This was most pronounced for butters and spreads, where the size of savings fell by 3.6% over the two years, followed by vegetables (3.5%) and crisps (2.9%).

Examples of 'shrinkflation' - reducing the size of product while maintaining the original price - included Nescafe Azera Americano decaffeinated instant coffee shrinking from 100g to 90g and Walkers Classic Variety crisps dropping from 24 bags in a multipack to 22 bags.

Which?'s investigation also found that own-brand budget ranges - which have seen the lowest level of inflation at just 0.2% compared with 3.2% for own-label premium ranges - have become less available.

Budget own-brand items were unavailable on three times as many days during the most recent three-month period than two years previously, according to the study.

Of the 20 product categories, own-brand cheese was out of stock the most at 17 days in 2022 compared with six days in 2019.

Which? is calling on supermarkets and manufacturers to provide clear unit pricing to allow consumers to easily compare and choose the best value items, such as cost per 100g or 100ml, and ensure that budget items are readily available.

Sue Davies, Which? head of food policy and consumer rights, said: "Our research reveals that eye-watering price rises are being exacerbated by practices like shrinkflation and limited availability of all-important budget ranges - and these factors are combining to put huge pressure on household shopping budgets.

"During an unrelenting cost-of-living crisis, consumers should be able to easily choose the best value product for them without worrying about shrinkflation or whether their local store stocks budget ranges."

A Tesco spokesman said: "We are committed to providing great value for our customers, whether it's promising 'Low Everyday Prices' on 1,600 staples, price matching around 650 basics to Aldi prices, or offering exclusive deals and rewards through thousands of Clubcard prices."

British Retail Consortium director of food and sustainability Andrew Opie said: "Rising inflation is a continued concern for both consumers and retailers. The global price of many food commodities has reached record highs over the last few months, pushing up prices for consumers. Other price pressures include increased energy, transport and labour costs, all of which are being exacerbated by the situation in Ukraine.

"Retailers will continue to do all they can to keep prices down and deliver value for their customers by limiting price rises and expanding their value ranges."