Volume Growth Eluding Food Stores But Not Restaurants

Articles
July 25, 2012

Volume Growth Eluding Food Stores But Not Restaurants

The Food Institute reports that in the second quarter of 2012, food store sales grew just 2.8% from a year earlier, while retail food prices advanced 2.9%, indicating there was no volume growth at retail food stores, according to the trade group’s analysis of just-released data from the Bureau of Labor Statistics and Census Bureau.

The Food Institute reports that in the second quarter of 2012, food store sales grew just 2.8% from a year earlier, while retail food prices advanced 2.9%, indicating there was no volume growth at retail food stores, according to the trade group’s analysis of just-released data from the Bureau of Labor Statistics and Census Bureau. Of course, food sales at alternative retailers such as warehouse clubs, supercenters, drugstores and dollar stores are not included but are taking share way from traditional food stores along with foodservice operators. While food and beverage stores rang up $311 billion in the first half of 2012, the Food Institute estimates that alternative retailers such as warehouse clubs, supercenters and drug stores sold another $110 billion worth of food products.

On the other hand, sales at eating and drinking place establishments during the second quarter rose 7.6% on the heels of a 9.9% increase in the first quarter – firmly outpacing the inflation rate for food-at-home, as well as the 3% rate for food away from-home prices. Consumers apparently are looking to splurge a bit more after economizing on their at-home food expenditures.

Combined second-quarter sales at food stores and eating & drinking places totaled $295.4 billion, with 54% coming from food stores and 46% from eating and drinking place operators. In 2001, food stores were responsible for 59% of the total – five percentage points more than the first half of 2012.

Indeed, more and more players are looking to take a bigger share of stomach and traditional food and beverage stores are taking the hit.

For all of the food industry’s latest economic news, go to www.foodinstitute.com.