Consumers Saving Money On Food, Restaurants, But Spending On Booze

As inflation encroaches on the average American household's balance sheet, big-name supermarket brands and restaurants expect to feel the pinch as consumers dine out less and switch to cheaper grocery alternatives.

In comments made at The Wall Street Journal Global Food Forum earlier this week, executives across the food industry lamented that shoppers have made the switch to cheaper brands or different products altogether, such as buying lower-priced species of fish.

On the restaurant side, it's tempting to coast on the pent-up demand the industry has enjoyed since newly vaccinated people began streaming in last year, Crafted Hospitality chef and owner Tom Colicchio said during the event.

But consumer habits are shifting fast, Colicchio said, warning of a potential wave of restaurant closures if inflation keeps people at home.

“I don’t know how long people are going to be willing to pay the high prices, especially if we have a recession looming,” Colicchio said.

Alcohol sales, on the other hand, reflect the general angst that many Americans feel in today's challenging times.

Information from Placer.ai indicates dramatic increases in foot traffic and liquor retailers like BevMo!, Total Wine & More and ABC Fine Wine & Spirits.

Visits to ABC, for example, are up 18.8% in May compared to 2019.

Placer.ai also noted that a spike in online alcohol sales means that the full scope of investment in at-home spirits is likely not reflected in foot traffic data.

Placer.ai reported earlier this year that some grocery chains, particularly among discount grocers, were experiencing strong growth, amid consumers seeking the best prices as costs continue to rise.

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