Savvy Shoppers Hurt Grocery Sales
Shoppers at local grocery stores are saving money, but that may not be good for some stores. The continued downturn in the economy led to steep drops in grocery store earnings for the parent company of Save A Lot. Shoppers at a store on the near East Side of Columbus are shopping smarter.
Brodina Williams unloaded her groceries after a shopping trip to the one year old Save a Lot store on East Main Street. Williams says she is happy the store is close to her home.
"Like here you get a lot of savings. There's only two of us in our household and one child," Williams said.
Over the past year, Williams changed jobs as a home health aid. Now she watches her grocery bill closer.
"Do you use more coupons now or you look carefully at the sales. Yes I do, I do, and I didn't use coupons before but now I do because of the economy," admitted Williams.
Save A Lot's parent company Supervalu Incorporated reports that coupons and food-stamp usage continue to rise indicating a turn around in the economy has yet to arrive. Earnings for the company dropped by 41% in the first quarter of this year. Same store sales dropped 6.5 % during that time.
Shoppers like LaQuan Williams say their household budget is tighter and saving with coupons is a must.
"I just used a lot of them in there. They were looking at me like hey he's cutting coupons. Yes I'm cutting coupons. I need money. How much did you save on coupons? Fifty dollars," Williams exclaimed.
President and CEO of the Ohio Grocers Association, Tom Jackson says grocers have been hurt in several ways.
""We have a very cautious consumer. They're making a list at home and they're bringing that list to the store and they're following that list very carefully, which really kind of eliminates a lot of the extra sales if you will or the impulse sales," explained Jackson. Save a lot shopper and mother of 5 Naomi Alexander says she doesn't buy junk food as much since she trimmed her shopping list.
"Try to do the best you can. Look at prices, cause I ain't never used to do that before, but now I look at prices," laughed Alexander.
Jackson says stores also have suffered from lower prices.
"We're suffering a lower sales not only because of the economy but also because we're got deflation in dairy, we've got a little bit of deflation in produce and a little smaller portion of deflation in meat. And what that means is that I might be selling the same amount of milk I sold last year the same number of gallons, but I won't have the sales numbers because my price is lower," Jackson explained.
The slowdown in grocery profits caused some stores to change strategy. Instead of focusing on slashing prices across thousands of items, the stores are trimming the number of products they promote and are reducing normal shelf prices. Jackson says pricing the products fairly will help boost grocery sales.