Concerns mount over rising gas, food prices
May 9, 2011
by Meat&Poultry Staff
CHICAGO – Technomic Inc.’s most recent consumer sentiment and behavior survey found that 84 percent of consumers believe grocery prices have risen in the past three months while 62 percent believe restaurant prices have risen. During the same time period, 50 percent of consumers believe packaged food sizes have gotten smaller and 32 percent believe the same thing has happened with restaurant portions.
Two primary reasons emerge as to why consumers think package and/or portion sizes have gotten smaller: the desires of food and restaurant companies to enhance profitability and to keep retail prices the same when costs rise. Ten percent attribute the downsizing to improving the products' healthfulness.
Very few consumers noted any decline in the quality of packaged foods and/or restaurant meals, Technomic found.
The rapid rise in gas prices, now at record highs, has raised consumer sensitivity to price increases in grocery stores and restaurants, said Bob Goldin, executive vice president. “Consumers are deeply concerned about the price of gas, which they expect to continue to rise,” Goldin said. “As a result, they are very likely to reduce their spending on groceries and restaurant meals and increase their reliance on coupons and deals.”
Consumers have also become more aware of total value, of which package/portion size is a key component, Goldin noted, and he urged food and restaurant companies to be sensitive to the risks of downsizing.