To document the changing nature of the marketplace, IRI, Anne-Marie Roerink of 210 Analytics and Marriner Marketing have teamed up continue to bring the latest trends and analysis relative to dairy, deli and bakery department sales. This is the second in a series of reports presented by IRI, discussing inflation trends.
Perishables
In March, total perishables grew 6.3 percent, with above-average increases for bakery, deli and refrigerated, which includes dairy. Compared to March 2020, the first month of the pandemic, the only departments showing increases were deli and seafood. The highest gain versus the pre-pandemic normal of 2019 was generated by meat, up 26 percent in March of 2022 versus March 2019. The departments still selling more units in March 2022 than they did in March 2019 are deli, meat, produce and refrigerated.
Dairy sales
“The four March weeks generated nearly $5 billion in dairy sales, an increase of 7.1 percent,” said Jessica Ives, professional development coordinator for IDDBA. “Also encouraging is the consistency of the weekly sales levels, all around $1.2 billion, which means demand is holding strong – certainly when compared to pre-pandemic levels.”
Milk was the biggest seller in March 2022, at $1.2 billion, which was down slightly from $1.3 billion in February. The next biggest sellers were natural cheese and yogurt.
“The two columns on the far right of the table below show the change versus year ago in dollars and pounds. The difference between the two percentages is a good proxy for the combination of inflation and fewer sales promotions,” Ives said. “For most, dollar sales were up year-on-year while volume was down.”
As an example, the gap between milk dollar growth and volume growth is nearly 13 percentage points – signaling double-digit inflation.
Deli sales
“The deli department remained an area of strength in March 2022,” said Heather Prach, director of education for IDDBA. “Just like seen in March, deli cheese was the only area of year-on-year decline but this was mostly related to much lower levels of inflation compared with the other areas within deli. Additionally, we continue to receive reports from retailers across the country who have had to close deli counters once more due to labor shortages.”
Deli meat sales totaled $605 million for the four March weeks compared with $746 million in February 2022 weeks. While down compared to last month, the $605 million did mean a 5.8 percent increase versus year ago. Compared with 2020, the first and fourth week of March showed increases but in going up against the massive spikes of the week endings March 13 and 20, sales could not hold the line.
Gains are inflation-boosted with volume sales having tracked in negative territory since the third-quarter of 2021.
Service deli meat remained the largest of the three areas, but all growth was driven by grab and go and pre-sliced deli meat. Both had increases in dollars and pounds, whereas service deli meat declined 12 percent in pound sales versus March 2021.
March 2022 deli cheese sales totaled $562 million, which was down from $576 million in February. Likewise, when compared to year ago levels, sales were down between 0.6 percent and 2.8 percent. However, it is important to note the relatively small difference between the dollar and volume performance — pointing to relatively low inflation.
With an average price per unit of $4.89, deli cheese prices in March 2022 have risen 4.7 percent versus March of 2021. Contrasting that to 9.9 percent for total deli unit inflation; 9.1 percent for deli entertaining, 12.8 percent for deli meat and 10.8 percent for deli-prepared foods, is the key to understanding the comparatively lower deli cheese growth.
To read the meat report from IRI presented by The Shelby Report, click here.
For more information, visit iriworldwide.com.
