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Grocery sales in the US are now dropping as unit sales decline, according to NielsenIQ data.
Middle- and lower-income shoppers are buying less due to inflation, SNAP cuts, and higher gas prices.
Value-driven grocers and discounters are gaining share, but total volumes remain under pressure across the industry.
Grocery operators across the US are facing a new reality, as reported by Bain & Company's analysis of NielsenIQ data. Since February 2026, rising grocery prices—long a buffer—can no longer hide shrinking basket sizes. For most months since February, per the data, grocery unit sales have fallen about 2% year over year, even as prices continue to rise 2–3%.
The pivot marks a new phase for the sector after pandemic-era demand and inflation fueled expansion—instead of settling, the volume contraction is now pulling top-line sales down at a national scale.
The slowdown is driven by a combination of macroeconomic pressures. Key contributors include a substantial decrease in Supplemental Nutrition Assistance Program (SNAP) participation after benefit cuts in late 2025 and tighter eligibility in early 2026. Meanwhile, consumers absorbed a 20% spike in gas prices in March 2026, compounding pain from a cumulative 33% increase in grocery prices since 2019.
Bain's Consumer Health Index indicates that lower- and middle-income households, in particular, show restrained intent to spend, barely returning to neutral after almost a year of erosion. While robust tax refunds—about $50B more than the prior year—and leftover pandemic-era savings provided a residual tailwind, they are being steadily eroded by persistent inflation.
Bain's latest Consumer Lab data shows that 80% of US households continue to look for ways to save, with more than a quarter actively targeting grocery bills for cutbacks. Among those consumers, 56% are downgrading to cheaper brands, 49% are simply purchasing fewer items, and 44% are using more coupons or deals.
Separately, growing use of GLP-1 diabetes and weight-loss drugs is shrinking total grocery demand further. June year-over-year unit comparisons illustrate the shift: unit growth was almost flat (+0.1%) in June 2025, but negative (-1.8%) for June 2026, a near-2-point swing in a single year.
Source: Yahoo Finance Top News — This article was automatically imported from the source. Read full article at original source →
