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"The price issue has basically become an economic imperative"

GfK figures and trends on fruit and vegetable consumption in Germany presented by Ulrike Singer

What do consumers in Germany really buy, and how much do they spend on fruit and vegetables on average? Ulrike Singer, Director Team Lead in Consumer Panel Services at GfK, presented GfK's latest figures and trends at this year's German Fruit and Vegetable Congress, based on a survey of 13,000 households. Although the consumer climate had plummeted due to ongoing crises and challenges in recent years, a stabilization of consumption was seen again from April to August 2023.

Fluctuating consumer climate
"The consumer price index shows that despite the sharp rise in prices in early 2023, consumers felt that, on the one hand, their salaries had increased and, on the other hand, prices were stabilizing again. In the third and fourth quarters of 2022, the gap closed again to some extent. In addition to the consumer climate, consumers' price expectations are also a key issue. There are simply too many promotions and too many discounts. Although consumer sentiment was good until the first half of the year, households have become more pessimistic again since August 2023, partly due to wage developments and high energy prices."

For example, 25 percent of all households in Germany would claim to be able to afford almost nothing. "This is a significant increase on the previous year. The number of households that say they can actually afford everything has also decreased significantly. The price issue has basically become an economic imperative. With high energy prices putting pressure on the budget, households believe that money can and should be saved on food and beverages. The media further reinforces this impression."

FMCG sales up 8.7 percent
But how high were the rates of price increase actually compared to recent years? For fast-moving consumer goods (FMCG), the rate of price increase in July 2023 was nearly 13 percent year-over-year. "Even if prices stabilize again, the increase will likely settle at about a 10 percent year-over-year increase." Discounters and full-line grocery stores turned over the highest sales in the FMCG category last year, with 34.6 percent and 29.2 percent each, followed by specialty retailers and hypermarkets. Bringing up the rear in this category were drugstores and e-commerce. Overall, there was an 8.7 percent increase in sales in the FMCG category from January to July 2023.

Sales and volume share of fruit, vegetables, and potatoes.
In contrast, discounting saw the highest year-over-year increase in fruit, vegetables, and potatoes, at around 13 percent. Year-over-year price increase rates for fruits and vegetables were 8.2 percent from January to July 2023. Fruits and vegetables had double-digit growth rates during the pandemic. Nevertheless, price changes for fruits and vegetables are below the FMCG average of +12.7 percent.

Fruits, vegetables, and potatoes show an 8.4 percent increase in sales from last year to July 2023. Vegetables are the top-selling segment in this category, with a 50 percent market share, and also show double-digit growth. There has been no year-on-year volume decline.

Price-driven sales growth
Sales growth in fruit and vegetables is almost exclusively price-driven. "A consumer has to spend an average of 3.30 euros for a kilo of vegetables, ten percent more than last year. The largest price increase is seen in potatoes, with 17 percent, making a kilo of potatoes 1.60 euros per kg. However, it must also be emphasized that potatoes have not had a drop in sales because it is still a low-cost product. So the price increase has not had a big impact on the consumption of potatoes."

Promotional share was at 23 percent for fruit and 17 percent for vegetables in the first seven months of 2023. "Promotional share growth rates have increased sharply over the past four years. Fruits and vegetables are easily the busiest categories of all, with bakery products, meats, cheeses, etc. coming in second. If the image of the fruit and vegetable department is right, consumers will visit the store more often. In hypermarkets, almost 30 percent of fruit sales are now realized through promotions," says Singer.

"Discounters and full-range stores are on a par with promotions, with just under 23 percent, while specialty retailers are slightly above ten. In vegetables, discounters again run more promotions than full-line grocery stores." The price increase rates are in the double digits for bananas, berries, and citrus fruits. Especially in the case of berries, where, among other things, 6.60 euros/kg must be paid on average, people are more likely to abandon the product. Blueberries are also often on sale, but they are still an expensive fruit.

For more information:
Ulrike Singer
GfK SE
Sophie-Germain-Strasse 3-5
90443 N├╝rnberg
Tel.: +49 911 395 0
[email protected]
www.gfk.com

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