While inflation may have finally peaked across many regions, a sense of relief is short-lived. Prices aren't going back to pre-pandemic levels, but rather setting new, higher baselines. The ongoing increases continue to strain household budgets, particularly when it comes to groceries.

Grocery bills are surging, with Americans now spending $1,000 per month on average, according to USA Today. This translates to a larger chunk of household income dedicated to food than at any point in the past 30 years. The U.S. Bureau of Labor Statistics reports a staggering 21% increase in grocery prices over just three years. MarketScale points to several factors behind this trend, including high demand, evolving food preferences and the impact of global events.

The Wall Street Journal adds that Americans are more likely to shop at multiple stores, opting for “treasure-hunt grocery shopping.” In fact, consumers bought groceries from about 20 different retailers between March 2023 and February 2024, often choosing to shop more often but buy fewer items each time — which harkens back to a time before supermarkets made grocery shopping super convenient. “Some food stores are now leaning into differentiation rather than trying to be all things to all people,” the Journal continues, emphasizing their private labels or store brands.

To save cash, consumers aren’t just changing how often they shop; they’re also adopting new strategies. About 66% of Americans heavily lean on in-store coupons or choose to shop at “no-frills” stores such as Aldi, another Journal article notes. “Foot traffic at Aldi stores in March was up about 26% compared with the prior year,” versus a 6% increase at Kroger and 15% Trader Joe’s. At Aldi, pallets of goods are placed directly on shelves instead of being carefully unpacked and styled, requiring less stocking work. The stores are also about half the size of average supermarkets and carry significantly fewer options. The savings on rent and employees is then passed on to shoppers.

This focus on efficiency is a clear example of agility and resilience in action. By prioritizing low prices over elaborate displays and extensive product lines, Aldi is catering to a growing segment of budget-conscious consumers. Indeed, willingness to adjust strategy in response to changing market conditions positions any business for resilience.   

Reframing the story

Supply chain professionals who know how to manage risk and make decisions based on the data are more prepared to meet whatever challenges may come. That’s where ASCM’s Supply Chain Resilience Certificate comes in. With this credential, you’ll be able to analyze the situation at hand — whether it’s persistent inflation or a drop in customers — and determine the best way forward. Enroll today and learn how to prepare for potential disruptions before they happen.

Then, plan to attend ASCM CONNECT 2024: North America, where you can learn more about the topics of supply chain resilience, stability and agility at industry-leading educational sessions. Plus, you’ll have the opportunity to network with supply chain professionals who have pivoted to grow their businesses in times of uncertainty, an invaluable resource at any time. Register now!