Inflation continues to impact online and in-store grocery sales in the United States, with Walmart reporting quarterly earnings that missed Wall Street analysts’ expectations by a wide margin.
While U.S. grocery sales rose 8.1 percent year-over-year in April, they fell 0.1 percent compared to March, according to the April 2022 Census Bureau Monthly Retail Report. However, food inflation increased 9.4 percent in April, with food-at-home prices floating up 10.8 percent compared to April 2021, according to the Bureau of Labor Statistics' Consumer Price Index.
Data tech company Numerator reported average U.S. grocery prices rose 12.4 percent for the four-week period ending 1 May, 2022. Online grocery sales experienced the most inflation, with prices spiking 17.2 percent in the month, according to Numerator.
As a result of inflation, April online grocery sales dropped 3.8 percent versus last year, according to the Brick Meets Click/Mercatus Grocery Shopping Survey.
“It’s no surprise that inflation is affecting where and how people shop online for groceries,” Brick Meets Click Partner David Bishop said in a press release.
Rapidly rising prices are resulting in a shift in how U.S. consumers are shopping, Bishop said.
“Some customers may now find pick-up a more attractive service since it can help them avoid the higher incremental costs associated with delivery, and others may choose to simply move more of their transactions back into the store,” he said.
In another sign of tough times for retailers, Walmart reported a total revenue increase of 2.4 percent to USD 141.6 billion (EUR 134.3 billion) in its Q1 2023 fiscal-year earnings. Walmart said in a press release its revenue was negatively affected by USD 5 billion (EUR 4.7 billion) in divestiture. Walmart’s U.S. comp sales rose only 3 percent in the quarter, but jumped 9 percent compared to two years ago, it said.
The results “were unexpected and reflect the unusual [economic] environment,” CEO Doug McMillon said. A significant jump in fuel prices, elevated labor costs, and aggressive inventory levels weighed on the company, Walmart Chief Financial Officer Brett Biggs told CNBC.
Club stores have been the retail sector least-impacted by inflation, according to Numerator. Grocery prices in the club channel rose 7.6 percent, less than half of that seen in the online and dollar channels.
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