Say Anything Blog

A new study suggests that supermarkets are losing customers due to rising fuel prices.

From The Associated Press:

For financially pressed consumers, it's coming down to a choice between spending on gasoline or groceries, and gasoline is winning, a food industry analysis finds.

"Given the economic environment, it is not surprising that more shoppers are buying food today in discount stores and other low-price venues than ever before," said the report by the Food Marketing Institute, released at the organization's annual trade show in Chicago.

"High oil prices, both at the pump and for home heating, depress consumers' ability to spend more," the study said.

Gasoline prices have been soaring: about 35 cents a gallon since December, driven by surging crude oil prices, according to gasoline industry analyst Trilby Lundberg.

The food industry report said the fuel price increases are tightening the pressure on personal budgets that already were squeezed hard by credit card bills.

I'm not buying the premise of this article. You can't tell me that people are skimping on food purchases in order to afford more gasoline. Common sense tells me that when you need to save money you cut out some of your unnecessary road trips not some of your meals.

There's a better reason for falling sales at supermarkets and its actually cited in this article:

"Given the economic environment, it is not surprising that more shoppers are buying food today in discount stores and other low-price venues than ever before," said the report by the Food Marketing Institute, released at the organization's annual trade show in Chicago...

Consumers feel the financial pain and are acting to ease it by finding cheaper places to spend on food, said the FMI report, citing a survey commissioned by the trade group. The survey of more than 500 people telephoned randomly in January had a margin of error of 4.5 percentage points.

So basically, consumers are just doing some bargain shopping. What's wrong with that?

Gas prices are high and are impact our economy in a negative fashion, but if you're searching for a reason as to why less people are buying their food at supermarkets wouldn't the fact that people have found a cheaper place to purchase their food be a better assumption?

Of course it would, but if the media makes that assumption it sounds too much like good-old American entrepreneurship, and we don't want that getting too much attention during a Republican administration.