Major food companies offering deals, new sizes as low-income Americans spend less

[BumRushDaShow]

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Source: Reuters

April 8, 2024 6:12 AM EDT


NEW YORK, April 8 (Reuters) - Americans relying on government benefits to buy food and other essentials are slashing spending, prompting food makers like Kraft-Heinz (KHC.O) and Conagra Brands (CAG.N) to overhaul their products and strategies following years of price hikes. Many of the biggest makers of packaged foods and drinks are seeing their sales volumes fall, due partly to low-income consumers -- typically making roughly less than $35,000 per year -- cooking from scratch, using up leftovers or just buying less.

Roughly one-third of Black American households and 21% of white American households fell into this category in 2022, according to the latest available U.S. census data. "We expect reduced SNAP [food stamp] benefits will be a headwind," Dollar Tree (DLTR.O) CEO Richard Dreiling said during a March 13 earnings call. Dreiling was referring to the U.S. government's supplemental nutrition assistance program (SNAP), which provides benefits to low-income families to help them afford groceries.

At Circle K convenience stores, sales from people using food stamps were down 40% from last year. "We can look geographically and see that where we've got lower-income consumers, our results are worse," Brian Hannasch, CEO of Alimentation Couche-Tard (ATD.TO), which operates Circle K, said during a March 21 earnings call. To appeal to Americans who can no longer afford fast food, Conagra in late May will introduce new Banquet chicken patties, priced at $6.99 for six, a company spokesman said. Chicken sandwiches are top picks at fast-food chains.

Sherry Frey, NielsenIQ vice president of wellness, said that low-income consumers eat less produce and fresh meat than wealthier shoppers. "For sure SNAP and WIC shoppers are looking for value," Frey said, referring to government food benefits for women, infants and children (WIC). "Unfortunately so many SNAP and WIC shoppers are food insecure and they’re subsidizing at food banks as well."

Read more: https://www.reuters.com/business/retail-consumer/major-food-companies-offering-deals-new-sizes-low-income-americans-spend-less-2024-04-08/

[JT45242]

1. And live in food deserts with dollar store shrinkflation

Dollar stores (the multiple brands... Dollar General, Dollar Tree, etc) targte low income areas. The they charge MUCH MUCH more per ounce/serving by using tiny boxes in these stores.

Makes it harder and harder for low in come folks to shop and eat well.

[Johnny2X2X]

4. Walgreen's too

And CVS and other phramacies. We live near a Walgreens and stop there occasionally to pick up and item, but see people with shopping carts full, they're doing their shopping at Walgreens, they're getting life half the food they'd get at a major grocery store chauin, and no fresh fruits or vegetables.

Food deserts are real. And I've been harping on this for deaces on DU now, but poor people pay more for literally just about evrything. Everything is a scam and everything is more costly. Renting is now more expensive than owning in many places. And from scam payday loans, to scam credit card offers, to subprime auto loans, to scam online colleges, and scam leding tree offers, the entirety of comsumerism for poor people is expensive and risky.

And I swear, prices at store chains are higher in poorer neighborhoods. I am in West Michigan, and the prices at the big grocer here, Meijer, seem cheaper in the stores in richer areas.

[dutch777]

2. Not just low income. I look at things like a box of air, I mean cereal, and go "Nope", not worth it.

Luckily I am retired and time is not much of an issue but I have started buying in bulk and making our own stuff like salad dressing and sauces. Oatmeal is more filling, better for you (if you can avoid adding sugar) and cheap. If convenience is your main driver, you will always be paying a premium for less quality AND less quantity.

[Ritabert]

3. I stopped buying chips, cookies and soda

...long ago. I'm also making more stuff from scratch and not using frozen food or processed foods.

[surrealAmerican]

5. They're pretending they've just discovered ...

... the law of supply and demand.

The prices are too high, so people buy less - yes, this still happens.

[Omaha Steve]

6. AFTER a review by forum hosts LOCKING

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