Smaller baskets

With food prices in the EU rising 10.7% year on year in 2022, consumers responded by buying less and trading down to lower-cost items. As a result, total grocery sales in the EU grew 2.9% year on year in 2022 according to McKinsey.  The downtrading trend was beneficial to private label store brands and to discount stores, segments which gained wallet share over the last two years. While inflation has abated, a McKinsey survey found a growing share of EU consumers expect to switch to less expensive food items and seek other forms of discounts in 2023.  Notably, reversing a trend of the last few years, somewhat fewer consumers expect to purchase food categorized as healthy, organic, or sustainable.

Sources: McKinsey, April 2023