start to impact people more and more . While inflation seems to be gradually coming down , the cost of living is a challenge and prices are massively important to consumers .
Pricing is key
“ As a result , we are seeing some counter activity , such as shrinkflation , which is when brands reduce package sizes for example . The reality though is that retail has always been a high-volume , low-margin game . There is a very limited amount of profit to be made between retailers and brands , so pricing wars are increasingly common . Suppliers are under real pressure from inflationary forces , and yet , the consumer requires increasingly more for less . The pound is becoming more and more stretched , and the retailer is caught in the middle , still trying to make a profit and do a good job .
“ We work with several grocery stores and FMCG products . While grocery products , as necessities , are fairly stable in terms of spend , retailers dealing with more discretionary consumer products will find it very tough . People are trading down , and as a consequence , we are seeing the market shares change . Morrisons , for example , dropped out of the big four for the first time . Meanwhile Lidl and Aldi ’ s Christmas sales were strong . Retailers are looking to own-brand items , as consumers increasingly trade down from branded favourites . Pricing is key , and retailers are examining cost and efficiency . Data and technology play into that , and particularly , in terms of how they can be used to ensure the right products are in the right store , at the right time ,” he highlights .
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