The recent improvements to consumer confidence has been seen at some restaurants and retailers, as was discussed in "Recipe for Success" and "MSSI Monthly Movers: March". The effect this shift has had on grocery chains, however, has been varied.
Across all grocery chains tracked by Geezeo's MSSI, consumers' average monthly spending has remained relatively unchanged in 2009, only increasing by an overall of 0.1% from December of last year. Gains over the last twelve months have been only a moderate 6.39% as well. These facts do not tell the full story.
Several large grocery chains have been affected differently by the the last twelve months of economic uncertainty. Supermarkets under the Kroger (NYSE: KR) umbrella, as well as Publix (OTCQB:PUSH) stores both have seen strong 12-month spending increases of 14.9% and 16.8% respectively, boosted by consumers going out to eat less. This trend has had almost the exact opposite effect for natural food retailer Whole Foods Market (NASDAQ: WFMI), which MSSI statistics show has seen an overall decrease in monthly spending of just under 10% from a year ago.
Could the new year be reversing these trends? MSSI data through March shows that the average monthly spending at Whole Foods has actually rebounded in 2009 so far, whereas Publix spending has faltered. Shoppers have increased their average expenditure by 2.25% at the organic-centered food retailer, while Publix customers have decreased their spending by nearly 4% from December. Looking at numbers further shows that year-on-year performances for both of these grocery retailers (down 11% at WFMI and up 12% at PUSH) are following the last twelve month trends, still indicating that consumers are more concerned with affordability rather than purchasing healthier dietary options.
Data from Geezeo's MSSI shows that average spending per trip at grocery stores in general have stayed relatively stable throughout the recession, but a combination of lower gas prices and price-conscious consumers have led to an overall increase of 11% in customer frequency per month. These trends should continue as long as employment worries remain, which could be several months after the economy recovers.
This data was compiled by the Geezeo Main Street Spending Index (MSSI).