Inflation is likely to keep consumers home this spring.
A new poll of 50,000 panelists conducted for the Ontario Produce Marketing Association says over the next three months, rising costs will force people to cut back on spending money at restaurants and bars. About half of the respondents said they’ll make fewer trips out.
And they won’t be ordering in as much either – an equal number said they’ll cut down on food deliveries to save money.
Instead, they say, they’ll support local, focus on freshness and think about their health.
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Who knows if they’ll actually do it. The arrival of spring is normally associated with emerging from our seasonal, winter-tight caves and reintegrating back into society, not pulling back our horns.
And globally stabilizing prices for many food commodities held some promise for this spring’s arrival.
But with inflation continuing to march ahead on many fronts, it looks like consumers see their shadows and are ducking back into their dens.
About a fifth of the panelists said they’ll cut back on fresh meat and produce. But at the same time, about half said inflation won’t influence their intentions to buy local produce. The survey results that appeared earlier this week don’t mention anything about meat, which is ironic. If you want to support local, you can buy meat year-round from livestock raised by local producers. Fruit and vegetables are much more seasonal.
Whatever the case, the results underline what the produce association calls “a very difficult macroeconomic environment” as the sector tries to navigate through it. The whole value chain, from suppliers to retailers to food service – need to know consumers’ intentions.
Bars and restaurants won’t throw in the towel. But it looks like they’ll need to plan a full-court push to maintain patronage. Expect to see an emphasis on promotions and patios, as sun-seekers yearn to get out of the house, soak up some sun and breathe the spring air on a patio.
Suppliers should also expect consumers to focus on value. One of the best values going is frozen food. If people are cooking at home and cutting back on fresh meat and produce, they can still get a wide selection in the frozen aisles. It’s not a marketing approach that you’d traditionally associate with spring. But inflation-wise, nothing is normal.
I suspect that like bars and restaurants, grocers will push back against consumers’ inclination to cut back, especially for outdoor grilling. If you aren’t spending money getting someone at a restaurant to grill you a steak, grocers might be able to convince you to grill one yourself, at home.
All this could bode well for prices, and for competition between grocers. The survey said almost 60 per cent of consumers are concerned about inflationary price increases specifically for fresh fruits and vegetables. That means many people are buying more produce when it’s on sale – and 42 per cent shop at more stores to get the best price. Given how some grocery chains’ have been profiting mightily over the past couple of years thanks to food inflation, it’s reasonable to think they might now step up discounts to attract and accommodate shoppers, without going broke.