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Retail

Inflation Shrinks Shopping Cart Sizes in Portugal

By Branislav Pekic
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Inflation Shrinks Shopping Cart Sizes in Portugal

Portuguese shoppers are making more frequent trips to the supermarket but buying less each time they do so, prioritising lower-cost products, as they respond to the effects of inflation.

According to a Kantar study, the results of which were published by Economia Online, Portugal's grocery sector reported a 6% decrease in purchase volume per trip in 2023 compared to the previous year, which had already seen a significant 13.2% drop.

The only exceptions were hygiene/beauty products and petroleum products – categories in which consumers purchased more.

Positive Forecast

At the same time, the Portuguese Association of Branded Products Companies (APED) has said there are reasons for optimism – it has forecast a 3% increase in spending on everyday consumer goods and a 1.2% rise in purchase volumes for the coming year.

This projection is based on factors such as a slowdown in inflation, wage increases outpacing price hikes, potential interest rate cuts, continued job security, and a booming tourist season.

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Another trend that's expected to continue, albeit at a slower pace, is the rise of private-label products.

Store brands now account for 45% of grocery spend in Portugal, up from 38% in 2020.

Demand For Convenience

Convenience is another trend that solidified in 2023. Purchases of frozen meals, dehydrated dishes, and refrigerated convenience foods saw a 28.6% increase last year compared to 2019. Kantar highlights this category as the biggest value generator for supermarkets, driven by higher average spending and purchase frequency.

Finally, the study indicates that while in-home consumption continued to decline in 2023, out-of-home consumption is on the rise again. The most recent quarter saw a 16.6% year-on-year increase in spending on eating out, including breakfast, lunch, dinner (+18.1%), and snacks (+15%).

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