Talking Retail Grocery and product news for independent retailers
Josh Graham, co-founder and chief marketing officer at Airtime Rewards, commented: “With inflation remaining stagnant at 4%, challenges are looking to remain for some time.
“Following a strong month in November for retail sales figures, merchants and consumers may feel frustrated that inflation isn’t moving as quickly as expected.
“This is continuing to squeeze consumers’ finances and eat into their limited disposable income, while putting pressure on British retailers. December’s retail sales only grew by 1.7% from November1 – less than the rate of inflation – meaning retailers are having to work even harder to attract and retain their customers.
“Against this backdrop, merchants will need to provide exceptional customer experiences, both online and in-store, to entice customers to part with their cash amid the cost-of-living crisis.”
Mohsin Rashid, CEO of ZipZero, said: “What a blow for Britons. Just as financial recovery had begun to feel possible, hope has once again been ripped away as inflation remains eye-wateringly high – at almost double the Bank of England’s target.
“The inflationary pillage of our pockets is set to continue, at least for the first half of 2024 – so expect tight budgets and financial sacrifice to remain the default for millions across the country. Until inflation is properly squashed back down to manageable levels, it lies with the government and retailers to step up their support for consumers, through targeted relief and competitive pricing respectively.”
Jessica Moulton, senior partner at McKinsey & Company, said: “It’s disappointing to see inflation rise by 4%, up from 3.9% in November 2023. This unfortunately follows the same trend as the not-great news coming out of the US and Eurozone. The spectre of embedded inflation is with us.
“One encouraging point is the fall in food cost inflation from 9.2% to 8%. While still sky high, this is heading in the right direction. This eighth consecutive fall, after the extraordinary rates of food inflation in early 2023, will be welcomed by consumers. Especially with a big decrease in some staples like milk, egg and cheese now at 3.3%, compared to 30.2% a year ago.
“Many businesses will already be re-doing their 2024 forecasting, and thinking harder about managing costs, given inflation remains higher than consensus.”
