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Business of Food

Grocery price inflation hits 16.7% but plant-based sales still see growth

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3 min read
AUTHOR: Fiona Holland
Large selection of colourful plant-based foods

Grocery price inflation has risen to a new record of 16.7%, but the sales of own-label plant-based and vegan ranges went up by 21% in the four weeks to 22 January 2023, according to the latest grocery market research from Kantar.

The recorded inflation could add another £788 to consumer’s shopping bills every year unless consumers make changes to their shopping behaviours to reduce costs.

It is likely that Veganuary impacted the sales of vegan own-brand products in January, says Kantar.

Fraser McKevitt, Head of Retail and Consumer Insight at Kantar explained: “Growth was largely driven by existing shoppers of the category rather than new converts, with 3.4 million consumers making a purchase this January which is slightly down on last year. 

“Alongside the pull factor of events like Veganuary, the push element of new regulations on food and drink which is high in sugar, salt and fat could also be having an impact.”

Dry January has also seen a boost in no and low alcohol beer volumes which were 3% higher than last year.

Last November Kantar reported more consumers were buying own-label products due to their lower cost. Supermarkets have since responded to the increase in demand, with their own-brand lines having grown by 9.3%.

The level of spending on promotions has dropped to its lowest levels this month since at least 2008, according to the consumer data and consulting company.

The reduction in promotional sales could be due to HFSS legislation introduced last October, which banned all multi-buy promotions in supermarkets for products high in fat, sugar and salt. Mckevitt added: “£10 million less was spent on chocolate deals this January compared with last year, partially as a result of the new rules although we’re probably marking the wider impact of the drop in promotions too.”

For the fourth year in a row, Aldi came out as the fasted growing grocer in January, seeing nearly 27% higher sales year on year, and holding 9.2% of the market. Lidl’s sales also increased by 24.1%, giving it a market share of 7.1%.

Tesco is still the largest British retailer, holding a 27.5% market share, while Sainsbury’s sales increased by 6.1%, giving it 15.4% of the market and Asda follows closely holding 14.2%.

Co-op, Waitrose, Iceland and Ocado had the lowest share this month, holding 5.5%, 4.7%, 2.5%, and 1.8% respectively.

Aldi, Waitrose and Lidl also scored the best in Kantar’s most recently collected customer satisfaction data, with Aldi receiving the highest score on pricing and overall value for money, while Lidl was praised for its easy access to stores and availability of products on-shelf, and Waitrose gained recognition for its well-informed staff.

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