Americans are increasingly relying on dollar stores to feed their families as inflation has driven grocery store prices up by as much as 12.2%.
Grocery sales at discount stores spiked 71% between October 2021 and June 2022, the analytics firm InMarket found, while sales of the same items in grocery stores dropped 5%.
The shift comes as 61% of Americans are living pay check to pay check, according to a LendingClub report, and affordability-branded chains like Walmart warn prices won’t be dropping anytime soon.
While some dollar stores stock fresh produce, the majority of stores only supply boxed and canned food high in sugar, spelling trouble for the health of Americans’ on top of their wallet woes.
The grocery trends are telling of the struggles which have plagued the US economy in recent months, and last Thursday’s announcement of a second straight quarterly decline in economic turnover.
Experts blame everything from President Joe Biden’s spending spree and supply chain snarl-ups to the war in Ukraine and sanctions on Russia roiling global food and energy markets.
Americans are increasingly relying on dollar stores to feed their families as inflation has driven grocery store prices up by as much as 12.2%
Grocery sales at discount stores spiked 71% between October 2021 and June 2022, the analytics firm InMarket found, while sales of the same items in grocery stores dropped 5%
San Antonio resident Lily Penelope told The Wall Street Journal how they had begun relying on a local Dollar General for groceries, eating mostly canned chicken, peanut butter and vegetables from the store.
Penelope, 26, is unable to drive due to a disability and can no longer afford the cost of both food from the local grocery store and the cost of an Uber to get there. Previously the total for such a trip was about $120, they said, but since January that cost has nearly doubled.
‘My health and the quality of my life has gone down,’ Penelope said, ‘I’m in a position where I’m having to choose between making meals I can afford and putting my health on the line.’
The Dollar General nearest Penelope doesn’t carry fresh produce, a problem which many across the country face as they turn to dollar stores for relief.
Of the more than 18,000 Dollar General locations across the country, only about 2,300 carry fresh produce, something the store said they are working to improve but don’t expect to see fulfilled for ‘several years.’
‘While Dollar General isn’t a full-service grocer, we consider ourselves today’s general store by providing nearby and affordable access to daily household essentials, including the components of a nutritious meal,’ a spokesperson said. She added that the company expected to stock fresh produce at 10,000 locations over the coming years.
DailyMail.com researched prices of everyday items and calculated how much they would cost had inflation stayed at the Federal Reserve’s target 2 percent rate — not the runaway hikes we’ve seen this past year — to find out how much extra consumers are currently paying
Customers shop at a Dollar Tree in Chicago. According to a spokesperson for the chain, 16,162 of their stores carry frozen produce, along with sugar-free groceries, whole wheat options, and milk and eggs
Until then, consumers will have to depend on their boxed, canned, and if they have them, frozen produce options. Though such products are less healthy, customers are willing to endure those drawbacks for the price.
‘Everything in there is super-duper sweet,’ 41-year-old Phoenix Kamlo told The Wall Street Journal, ‘But it’s nearby, and it’s cheap.’
Dollar Tree has echoed Dollar General’s sentiment that they never intended to be grocery stores for their customers, and are instead intended to supplement more robust grocery options.
According to a spokesperson for the chain, 16,162 of their stores carry frozen produce, along with sugar-free groceries, whole wheat options, and milk and eggs.
Inflation in the U.S. rose to 9.1 percent in June, the highest since 1981 and above what economist had predicted
The trends come as stalwart budget and bulk buying options like Walmart have told customers not to hold their breath for reduced food prices, all the while slashing tags on items like apparel which have gone unsold en masse as consumers tighten their budgets.
‘The increasing levels of food and fuel inflation are affecting how customers spend, and while we’ve made good progress clearing hardline categories, apparel in Walmart U.S. is requiring more markdown dollar,’ said Walmart CEO Doug McMillon in a statement.
The Walmart’s share prices dropped nearly 9% last Monday alone, and the company expects to announce a decline in profits in its earnings report next week. Retailers like Target have also reported similar consumer trends.
‘As the country’s largest retailer, Walmart is a bellwether for the entire sector,’ said Neil Saunders, managing director of GlobalData Retail in a report, ‘Its downgrading of second quarter and full fiscal guidance is a cause for concern and highlights the pressure that all retailers are currently under.’
The Walmart owned bulk store, Sam’s Club, reported its income had increased 10.5% from last year in May, while the discount supermarket Aldi had seen ‘significant spikes’ in consumers with 2.5million new shoppers arriving in May alone, according to Insider.
The Walmart owned bulk store, Sam’s Club, reported its income had increased 10.5% from last year in May, while the discount supermarket Aldi had seen ‘significant spikes’ in consumers with 2.5million new shoppers arriving in May alone
Walmart lowered its profit outlook for the second quarter and the full year, citing surging inflation on basics like food that is forcing shoppers to cut back on discretionary items, particularly clothing, that carry higher profit margins
Inflation is the top issue for 24 percent of Americans, according to a YouGov poll released Tuesday. Rising prices were far ahead of the runner-up priority, jobs and the economy, at 12 percent.
The high cost of living has pushed 29 percent of Americans to take up a side hustle — from selling clothes online to taking paid online surveys — according to Insuranks, which ranks insurance firms.
Experts blame inflation on everything from supply chain issues to the war in Ukraine’s impact on food and energy markets. Still, high prices have doubtless hurt Biden’s approval rating, which has sagged to about 37 percent.
They also hurt retailers. In addition to Walmart and Target slashing their profit outlooks, McDonald’s and Chipotle Mexican Grill said customer trade is down.
Online retailer Amazon lost $2 billion in the second quarter, but said it expects a jump in third-quarter revenue.
The Federal Reserve announced on Wednesday that it would increase interest rates by 0.75 percent, pumping the federal interest rate to 2.33 percent as the central bank tries to control surging inflation.
The rate hike will cause interest rates on mortgages, credit cards and all types of loans to go up, causing monthly bill payments to soar and hurting Americans’ ability to repay debts.
While interest on savings will also see a small increase as high as 2 percent, it would do little to relieve consumers amid the rise in cost of living.
The Commerce Department on Thursday said the US economy had contracted for the second quarter in a row, meeting the classic definition of a recession.
Gross domestic product shrank 0.9 percent in the second quarter, following a decline of 1.6 percent drop in the first quarter.
Another inflation measure, the personal consumption expenditures price index, soared 6.8 percent in the 12 months through June, the biggest increase since January 1982.
Of the more than 18,000 Dollar General locations across the country, only about 2,300 carry fresh produce, something the store said they are working to improve but don’t expect to see fulfilled for ‘several years.
Many discount store consumers depend on boxed, canned, and if they have them, frozen produce options. Though such products are less healthy, customers are willing to endure those drawbacks for their price
The White House has challenged the notion that six months of economic contraction was a recession, pushing its message that the economy remains strong.
Biden said in a statement that ‘it’s no surprise that the economy is slowing down as the Federal Reserve acts to bring down inflation’.
‘But even as we face historic global challenges, we are on the right path and we will come through this transition stronger and more secure,’ he added.
Many economists and analysts have traditionally defined a recession as two consecutive quarters of GDP contraction. But the official private research group that tracks U.S. recessions looks at other indicators, including jobs and spending.
John Leer, the chief economist at Morning Consult, an analytics firm, predicted more pain ahead, saying ‘inflation will likely remain elevated at least through the summer given its current momentum and its spread from goods to services’.
HOW FAMILIES ACROSS THE U.S. ARE MANAGING THE CRUNCH
Gas prices make softball away game trips for 18-year-old Idaho twins too costly
Jennifer Liebrum’s family have had to cut back on driving long distances across Idaho, meaning softball away games for 18-year-old twins Devon and Gracie are in the rearview mirror
Jennifer Liebrum, 56, from Bellevue, Idaho, who works with special needs children, and husband Tyler Peterson, 51, a farrier, used to enjoy driving their twin 18-year-old daughters Devon and Gracie around the region for softball matches.
The sporting vacation trips came to an end when the cost of a full gas tank shot up from $70 to $160. Their household income is $50,000-$100,000.
‘They canceled the team, because we’re not the only ones in the predicament,’ said Liebrum.
An SUV now idles in the driveway. The family increasingly gets around by walking and cycling in an effort to ‘get through this crunch’, she added.
Groceries used to cost $100 a week, but a recent haul of two days’ supplies was $170 — prices that left Liebrum feeling like she was ‘going to a jewelry store’.
Even driving 60 miles to the nearest Costco to load up on more affordable produce stopped making sense due to gas prices.
‘We’re considering getting chickens again, which I hate,’ she joked.
‘We’ve been getting ready to launch two girls into life. And now those savings are for survival.’
They are the sixth generation to live in the valley and ‘part of the pioneer group that established this place’, said Liebrum.
Billionaires like Elon Musk, Jeff Bezos and Bill Gates descend on the area in private jets each year for the nearby Sun Valley Conference, a networking extravaganza for tech and media moguls.
Once-a-month filet mignon treats are out for New Jersey family
Thomas Crowell’s New Jersey family is struggling with inflation and the couple’s retirement plans have been pushed back, but the wedding of son Connor, 25, at the end of the year is a highlight on the calendar
Thomas Crowell, 58, a benefit consultant from Forked River, New Jersey, says he has ‘cut back on splurges’ like the tasty filet mignon stakes he and wife Chris, 57, an administrative manager, used to savor each month.
Even by avoiding meat and poultry, weekly grocery bills of $250 have risen to ‘well over’ $300 and filling the gas tank has shot up from $45 to $70, said Crowell. The household income is between $100,000-$150,000.
Their son Jack, 21, lives at home, but Connor, 25, moved to Nashville, Tennessee, and is getting married later this year.
The Florida and Caribbean holidays the family previously enjoyed are in the rearview mirror.
‘We would go out to mom-and-pop restaurants three times a week, we’ve cut back on that,’ said Crowell.
Worse still, the couple’s retirement savings have been ‘eaten away’ as stock values are ‘demolished’, said Crowell.
‘We do not know how long or deep this recession will be,’ he said.
‘When’s it going to be possible for us to retire?’
The country is ‘paying the price’ for overspending early on in the Biden administration, he added.
California couple switch European vacations for relatives on East Coast
Megan Aaron, 36, has been struggling with gas, food and daycare costs for daughter Harper, two, but says the family is still ‘lucky’ to be able to make their rent and put food on the table
Megan Aaron, 36, a theater worker from Los Angeles, California, husband Tim, 43, a paralegal, and daughter Harper, two, did not have expensive vacations in Spain or Mexico this year.
Instead, the family holiday was to a relative’s home in Massachusetts.
Weekly grocery bills shot up from $170 to $220 and gas prices in California are among the highest in the country.
Daycare for Harper at $1,400 per month takes a big bite out of the $100,000-$150,000 household income.
To make ends meet, Aaron is more careful about using up leftovers. She visits her hairstylist less often and has reverted to her natural brunette locks without highlights to save cash.
‘It has been really challenging,’ said Aaron.
‘Cutting out the luxury things that we just can’t do anymore.’
Downsizing to one car has been ‘logistically challenging’, she added, but the bigger problem is how the unstable economy makes it tougher to buy a home and plan for the future.
‘We’re very lucky that we’re able to afford our rents, daycare and the big expenses. We’re not in fear of being homeless or not being able to put food on the table,’ she said.
‘But it does make our lives a little more uncomfortable.’
Pizza parlor trips nixed as Maryland family hunker down for months of belt-tightening
Summer camp was cancelled this year for 11-year-old twins Daniella and Natalya Neubauer and their family. Instead of jetting off overseas for a summer vacation, the Neubauers spent a week at the Delaware shore
Family outings to the pizza parlor were the first casualty of the financial crunch for Sigurd Neubauer, 41, an online publisher from Maryland, his wife Hannah, 45, a doctor, their 11-year-old twins Daniella and Natalya and son, Cyrus, four.
The twins have to skip summer camp this year as prices have ‘skyrocketed through the roof’, said Neubauer. The household income is $100,000-$150,000.
Average camp costs have more than doubled to $178 a day from about $76 last year — putting them out of reach for many Americans.
International travel was off this year, and the summer vacation was a week spent on Delaware’s beaches.
The dad-of-three is skipping his morning visits to Starbucks and is brewing coffee at home instead.
Mum and dad both drive hybrid cars, meaning a full tank rose only from about $25 to $40.
While cutting back on restaurants, the family has focused on healthy activities like tennis and swimming.
‘This economy is going to be with us for a long time,’ said Neubauer.
He blames inflation on geopolitics and global food price hikes and other ‘structural problems that every American president would have to deal with’.