Household food bills set to rise by £682 per year as grocery price inflation hits record 14.7%

The cost of the average supermarket bill is forecast to rise by £682 per year as the cost of living crisis continues to push up prices.

Grocery price inflation has hit a record 14.7% and there is still no sign of a peak, according to a new report from market analysts at Kantar.

Kantar reported the record inflation figure for the four weeks to 30 October and warned that it will keep rising. The sum was £643 the previous month, based on a grocery inflation figure of 13.9%.

It means that households have seen the cost of the average annual supermarket shop increase by almost £40 in a month.

Sales of supermarket own-label products jumped again by 10.3% over the last four weeks and the cheapest value ranges grew by 42% as shoppers sought to manage their budgets by ditching branded goods, according to Kantar.

Fraser McKevitt, head of retail and consumer insight at Kantar, said: “Yet again, we have a new record high figure for grocery price inflation and it’s too early right now to call the top.

“Consumers face a £682 jump in their annual grocery bill if they continue to buy the same items, and just over a quarter of all households now say they’re struggling financially, which is double the proportion we recorded last November.

“Nine in 10 of this group say higher food and drink prices are a major concern, second only to energy bills, so it’s clear just how much grocery inflation is hitting people’s wallets and adding to their domestic worries.”

Shoppers switching to budget brands

Kantar said that dairy and dog food continued to be among products rising the highest in percentage terms. Its data also showed that just one in 10 households bought a pumpkin ahead of Halloween this October, while 700,000 fewer Christmas puddings were bought in advance of December as shoppers look to save money.

Mr McKevitt said: “This time last year two million consumers had already bought their festive Christmas pudding. We’ve seen 32% fewer shoppers doing that this time around, suggesting people are not trying to spread the cost of their purchasing – at least not in October.”

More shoppers are also switching to budget supermarkets in a bid to cut down on spending. It has seen Aldi become the fastest growing retailer in the latest period, increasing its sales by 22.7% year on year to gain 9.2% market share, while Lidl boosted sales by 21.5% to take its market share to a new record of 7.2%.

Asda again led the traditional Big Four supermarkets with sales growing by 5.3% to maintain an overall market share of 14.3%.

Mr McKevitt added: “With economic forecasters warning of a potential recession, it’s worth reflecting on how much the grocery landscape has changed since the 2008 financial crash.

“We’ve seen a rise in the market share of the discounters Aldi and Lidl, which together now stands at 16.4%, versus 4.4% 14 years ago.”