'No respite for consumer' as food prices remain 'stubbornly high'

8 hours ago 9

Clodagh Rice and Eamonn McGurk

BBC News NI

BBC Mr Gamble is standing in a warehouse. He's wearing a yellow high-viz jacket. Behind him are shelves stacked with goods. BBC

Neil Gamble, from the Henderson Group, says "food price inflation remains stubbornly high"

There will be "no respite for the consumer" in Northern Ireland as a grocery business warns food prices will remain stubbornly high this year.

It comes as official figures show food and drink prices rose by 4.5% in the 12 months to June. That is the highest rate since February 2024 but is well below the peak seen in early 2023.

The retail side of the Henderson Group was set up in 1897 and has brands like Spar and Vivo. It has grown to include wholesale and foodservice and now employs almost 6,000 people across Northern Ireland.

Chief financial officer Neil Gamble said: "There is no respite for the consumer in this environment - it's a tough environment."

Mr Gamble said he expects the rate at which food prices are rising could pick up slightly throughout the rest of the year.

"We think we are going to see that trend of rising prices continue, which is a real disappointment to us. We could see that trend going as far as 5% between now and the end of the year."

He said that has changed how consumers in Northern Ireland are shopping by reducing footfall, but not the size of their basket.

"The consumer is visiting the store less often, but buying more," he said.

"That's typical of a cost conscious and waste conscious consumer, living through a cost of living crisis."

What factors impact prices on the shelves?

Getty Images A young woman carrying shopping basket, choosing cheese, standing in front of produce aisle in a supermarket. She has long brown hair and is wearing a grey top with beige trousers. Getty Images

Mr Gamble says rising costs mean "we are re-evaluating the investments that we are wanting to make"

There are a myriad of global and local challenges pushing up costs for retailers.

Mr Gamble said: "We've seen trends across cocoa, coffee and butter that have led to direct price increases on shelf edges - the consumer will notice that.

"Unfortunately for us, food price inflation remains stubbornly high."

The latest company results showed group turnover was up but there were also signs of inflationary pressures.

For example, the company's wages bill jumped to almost £150m after the government increased national minimum wage and employers' national insurance contributions in April in a move that has made taking on staff more expensive.

He said: "Sitting here as we look at the rising cost base, we are re-evaluating the investments that we are wanting to make. Those costs bases have real consequences."

He added that energy costs have gone up substantially in recent years and are still "significantly elevated" compared to 2022 levels.

How do you keep prices low when costs are rising?

Getty Images A woman is pushing a shopping trolley in a supermarket. Eggs and vegetables are in the trolley. Getty Images

Mr Gamble says "we review our prices on a regular basis"

The retail market is highly competitive which means the business reviews prices weekly and has invested in prices and promotions and suppliers.

Mr Gamble said: "It's a very difficult balance to strike - we are looking at a combination of macroeconomic trends which are out of our control and what growth is forecast in the grocery market and what we believe is an acceptable return to re-invest back into our business.

"We review our prices on a regular basis, in conjunction with our suppliers, to ensure we are passing through the right costs to the consumer so they will come into our shop and buy more."

What do people in Northern Ireland think of food prices?

A woman with short red hair is standing in the street outside a supermarket. The ground is wet. She's wearing a grey top and a silver necklace.

Pat Marshall says "it all adds up, especially when you're a pensioner"

Pat Marshall said: "I used to do a weekly shop and sometimes twice a week, but now it's every fortnight or once a month, because it's too dear, and I can't afford it.

"What used to say cost you £10 now costs £12.

"It all adds up - especially when you're a pensioner."

A young woman is standing in the street and smiling. She has blond hair that's tied back. She's wearing a white top and necklaces. She has ear pods in.

Eve Cottell says, as a student, it's hard to budget with prices going up

Eve Cottell said: "As a student, it's hard to budget with prices going up and as a result, I won't be doing a full grocery shop as often."

She added: "If there are different options available, I'll always go for the cheapest option."

A man is standing in the street outside a supermarket. He's wearing a navy jacket and has brown hair and a moustache and short beard.

Jack Maginn tries to budget

Jack Maginn said: "I'm finding it more and more difficult to make my own budget stretch.

"I'm trying to find ways of making it stretch across a week to account for lunches to take into work and am maybe buying meals that aren't of the same quality that they were in the past."

A woman is standing on the street. She has long red hair tied in a pony tail and is wearing sunglasses. She's wearing a gold bar necklace.

Emma O'Brien says she considers the price of things more

As the mother of two young children, Emma O'Brien is "shopping nearly every day".

"I have to be very careful and shop around and not buy from convenience stores as they are too dear," she told BBC News NI.

"It never used to make much of a difference, but now that I have much less disposable cash to spend, I'm definitely looking more at the price of things."

A young man is wearing a cap and glasses and a navy jacket. He's standing in the street. A backpack is on his shoulders.

Cahin Brolly says price rises mean he does a once-a-week shop

Cahin Brolly said: "The rise in prices means I would probably do a once-a-week shop and keep it to the bare essentials and not buy anything unnecessary."

Read Entire Article