PLMA e-scanner July 9, 2022

The half-year numbers were powered in part by the most recent monthly performance. Store brand dollar sales grew by 10.9% in June, more than double the national brand increase of 5%. The figures were as of June 12.

In June, 15 of 17 departments showed store brand dollar growth, with only beauty and tobacco showing declines. Liquor and beverages showed the strongest growth with 28.3% and 20.3%, respectively. Meanwhile, refrigerated (18.3%), produce (10.2%) and the frozen department (9.0%) all showed solid growth.

This is the sixth straight monthly 2022 report from IRI that indicate dollar gains for private brands, but growth in the past 4 months is especially impressive. In March store brand dollar growth was 9.1%, followed by 9.8% growth in both April and May, and concluding with plus 10.9% in June. That is an average of 9.9% over four months and 10.2% in the past 3 months.

On average, overall dollar share for the first six months of 2022 came in at 18.1%, a strong increase over the 17.7% share in 2021 for store brands in all the major channels, according to IRI. Overall unit sales were an average of 20% for the first half of 2022, an increase over the 19.6% share in 2021.

While unit sales continue to decline for both national and store brands, both in June and for the first half of the year, store brands are showing better sales than their branded rivals. In June, national brands suffered a 5% decrease from a year ago, while private brands came in at minus 1.7%. For the first half of 2022, private brands averaged -2% unit decline while national brands had a -4% drop.

The most recent statistics are available for members at plma.com through the IRI Unify section. Members will find information on 317 categories and 967 subcategories, as well as statistics from 17 departments.

"Many customers continue to shop premium products throughout the store, including Private Selection, Murray's cheese, and Deluxe Meal Solutions,” McMullen told analysts. “For other customers, whose budget are more directly impacted by food and fuel inflation, they are actively looking for ways to save. We're doing everything we can to help this customer stretch their budgets."​

"Rising inflation has consumers rethinking their shopping and eating habits," McMullen added. "We are seeing different shopping behaviors based on how individual customers are experiencing the current inflationary environment."

McMullen also announced to help consumers with rising prices, the company is expanding its Boost membership program nationwide over the next few weeks. The program offers unlimited no-fee deliveries on orders over $35 and with double fuel points with each order.

Kroger, the nation's largest grocery store chain, is the latest major operator to highlight consumer shifts in response to rising prices for food, gas, rent and other goods and services. According to Mark Zandi, the chief economist with Moody's Analytics, the typical US household is spending about $460 more every month than they did last year to purchase the same basket of goods and services.

Inflation reached 8.6% for the 12 months ending in May, according to the latest Consumer Price Index (CPI). Prices for food purchased to eat at home rose 11.9%, the largest 12-month increase since 1979, with eggs up 32.2%, milk prices increasing 15.9% and poultry up 16.6%.

For May, the food CPI — including food-at-home and food-away-from-home — climbed 10.1% year over year and 1.2% month over month, following respective gains of 9.4% and 0.9% in April, 8.8% and 1% in March, 7.9% and 1% in February, and 7% and 0.9% in January.

Through the first five months of 2022, the month-over-month escalation in the food-at-home index continues to be dramatic, rising 1.4% in May after climbing 0.9% in April, 1.5% in March, 1.4% in February and 1% in January. The January increase followed just a 0.4% uptick in December.

The increase has been across all parts of the grocery store. All six major grocery store food group indices rose over the 12-month span through May, with five of the six up over 10%. The index for meat, poultry, fish, and eggs increased the most, up 14.2%, with the index for eggs surging 32.2%. The remaining groups saw growth ranging from 8.2% (fruit and vegetables) to 12.6% (other food at home).

Frozen and refrigerated meat, poultry and seafood led the specialty food categories in retail dollar sales in 2021, followed by cheese and plant-based cheese in second place, and chips, pretzels, and other snacks in third. Three refrigerated categories topped the fastest-growing group: ready-to-drink (RTD) tea and coffee at No. 1, followed by creams and creamers and then entrees, according to the Specialty Foods Association (SFA).

“The specialty food market has prospered amid two difficult years, with our latest research showing specialty continues to grow at a faster rate than all food,” Denise Purcell, vice president of content and education at the Specialty Food Association said in a statement.

The group did cite possible hurdles for the industry to overcome in the near future. “Growth will continue, but at a slower pace than the industry experienced during the 2020 pandemic-influenced whirlwind of grocery shopping and at-home meal preparation and will depend on supply chain bandwidth and shifts in challenges like inflation, shipping issues, cost increases and materials shortages.”

As far as individual products, specialty beverages jumped past food and grew twice as fast in 2021 after a drop in sales in 2020. SFA found consumers have expanded their shopping lists to include more specialty beverage purchases. The SFA found ready-to-drink alcoholic beverages like hard seltzer, hard kombucha and fermented functional cocktails showed rapid growth.

The report found the market for alternative dairy products, which are made from soy, almond, coconut, oat and more, is growing at a rate of over 10%, with sales reaching over $28 billion in 2022 alone.

Of the categories included in the study (milk, ice cream, yogurt, cheese), plant-based yogurt is expected to register the highest CAGR during the forecast period, as consumers seek more functional capabilities from food, and plant-based products in particular.

Of the major plant-based substitutes in the dairy alternatives category, soy is the most popular, and is expected to grow the most during the period.

 “Soy-based products are becoming popular, especially among women, including isoflavones, lowering the risk of heart disease and breast cancer,” the report explained. “Soy milk is one of the most popular and easiest-to-find non-dairy milk. Moreover, the increasing adoption of soy-based dairy alternatives among professional athletes and fitness enthusiasts further boosts the growth of the soy segment.”

Consumers seeking functional and healthy products seem to be the main driver in the popularity of plant-based dairy products.

“People widely consume yogurt to improve their gut health due to its natural prebiotic content,” wrote The Insight Partners. “Plant-based yogurts have low fat and cholesterol content, thereby boosting their popularity among health-conscious consumers. (Consumers) are looking for products with high nutrient content to fulfill their daily nutritional requirements. The dairy alternatives manufacturers are incorporating functional ingredients, such as antioxidants, collagens, adaptogens, and nootropics, in their products to meet the rising demand for functional dairy alternatives.”

At the end of the quarter, self-checkout was available in more than 8,000 Dollar General stores, with the retailer seeing the service receiving strong customer approval. This includes the pilot self-checkout only stores, where associates are available to assist customers.

Very few retailers have moved entirely towards a self-checkout-only model. Walmart has been testing the self-checkout only system consisting of traditional and belted self-checkouts. Amazon was the pioneer of the concept with its Amazon Go stores. But the current labor crunch and high costs has led to an accelerating the roll-out of self-checkout, especially in formats such as dollar stores and drug stores.

Tennessee-based Dollar General has over 18,000 stores in 47 states and record sales of over $34 billion in 2021.

 “Clearly, grocery shoppers believe that the stores they shop are far more profitable than they actually are,” said Doug Madenberg of The Feedback Group. “This inflated view of profits certainly leads some shoppers to think that food stores simply aren’t doing enough to keep prices down.”

The study also found 38% of consumers are buying more store brands. Nearly four out of 10 grocery shoppers indicated they have been buying more store brands instead of national brands, and our research shows that 75% of shoppers agree that the prices of private or store brands were a lot less expensive than national brands. The study surveyed 1,200 shoppers.

The Feedback Group found that in addition to buying store brands, shoppers are employing a wide range of strategies to cope with inflation, such as purchasing more food and groceries at stores with lower prices (cited by 46% of those surveyed), eating more often at home instead of at restaurants (46%), buying more items on sale (43%).

The company recently unveiled plans for three new Amazon Fresh stores in northern Virginia. A 45,000-square-foot store opened in Manassas on June 9, and a 38,000-square-foot location in Lorton is set to open its doors on June 23. Another Amazon Fresh is slated to open in Arlington “in the coming weeks,” Amazon said.

Also on June 9, Amazon launched an Amazon Fresh store in North Riverside, Ill., marking its eighth store in Illinois. The company opened its 15th California location under the banner in early June in Huntington Beach. Both of those stores also offer Just Walk Out functionality.

Amazon opened the first Amazon Fresh store in Woodland Hills, California in late August 2020, and in less than two years has expanded into 30 stores, with the opening of a store in Murrieta, Calif., in May.

The company has also announced plans for Amazon Fresh stores in the New York City area and future stores in Paramus, N.J., and Oceanside, N.Y. The company did not provide opening dates or further details about the planned Oceanside and Paramus stores but said both locations will offer Just Walk Out service.

BJ’s opened five new clubs and seven new BJ’s gas stations in 2021 and ended the year with 226 clubs and 157 fuel locations in 17 states. The company aims to open around 10 this year and in 2023.

“We’ve seen tremendous success in growing our footprint over the last several years, both in our core East Coast communities as well as in new markets like the greater Detroit and Pittsburgh areas,” Bill Werner, executive vice president of strategy and development at BJ’s, said. “Our expansion into the greater Indianapolis and Columbus markets allows us to bring the value of our membership to these new communities we look forward to serving.”

All four new clubs will feature BJ’s one-stop shopping experience, including an extensive selection of fresh foods; a full-service deli; household essentials like paper products, cleaning products, diapers, and pet supplies; and apparel, seasonal items, toys, tech, and local products.

By adding Walmart grocery delivery services to its app, Avanlee Care users can place Walmart grocery orders for delivery to recipients' home through the app, which also offers medication adherence and health and mood monitoring services.

Citing a 2018 AARP survey that found that 90% of U.S. adults ages 65 and older want to remain in their own homes, Avanlee said the partnership with Walmart is a way to further improve its support for senior customers and their family caregivers.

"We are excited to be working with Walmart for grocery delivery through the Avanlee app, reducing the many tasks associated with caring for an aging parent," Avanlee Christine, CEO and founder of Avanlee Care said in a statement.

"We're constantly thinking of ways to make the busy lives of caregivers easier,” Christine added: “Integrating online grocery ordering and delivery from Walmart into Avanlee Care further helps our caregivers access everything they need to support an aging relative in one place. The delivery status tracking gives caregivers confidence that their relative has the food they need when they need it."