More shoppers turn to discount stores to ‘cut the costs’ of inflation
Report shows average spending on grocery products at discount chains increased 71% from October 2021 to June 2022
Consumers turn to cheaper goods to 'cut the costs' of inflation
FOX Business' Lydia Hu reports from Nutley, New Jersey, where some shoppers are trying to stretch dollars amid 40-year high inflation.
Higher prices are forcing more families to buy their groceries at discount stores, according to a recent analysis on consumer shopping habits.
Data from InMarket shows the average American spending on grocery items at discount or bulk buying chains increased 71% from October 2021 to June 2022. The survey also revealed during that same time period, spending at traditional grocery stores dropped 5.6%.
"I definitely go to dollar stores when I can, like snacks for my daughter for daycare and stuff, just so I can kind of cut the costs," one shopper told FOX Business’ Lydia Hu outside a Dollar Tree in Nutley, New Jersey on Tuesday.
Shoppers are also looking for bargains at bulk buying stores like Costco, Sam’s Club and BJ’s Wholesale. Sam’s Club parent company Walmart reported in its May earnings that membership income was up 10.5% year-over-year.
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"It just gave us a better value and a better offer that was there," another shopper told Hu on "Varney & Co." "We never really go to ShopRite or Stop & Shop for anything anymore."
American shoppers have reported spending more at discount stores to "cut the costs" of inflation, according to one woman on "Varney & Co." Wednesday, August 3, 2022. (Getty Images)
Big-box retailers like Walmart have seen the shift in consumer spending, with the company anticipating customers to pull back on buying clothing and expecting earnings to fall by 11 to 13% next year.
Despite more Americans turning to discount goods, Bank of America Chairman and CEO Brian Moynihan touted the strength of the consumer, Tuesday, citing July consumer data against rampant inflation and the recession.
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Bank of America CEO touts July consumer spending despite inflation, recession
Bank of America Chairman and CEO Brian Moynihan highlighted the 'relatively strong' state of the average American consumer and how that impacts the Federal Reserve's handling of inflation.
"Right now, the consumer continues to have money in accounts, continues to spend, and also has the ability to borrow under lines of credit and things like that," Moynihan said on "Mornings with Maria." "And that's good news. Unfortunately, that makes the Fed's job very tough."
In June, consumer spending beat expectations and rose 1.1% from May, according to data released by the U.S. Department of Commerce. Consumer spending also accounts for more than two-thirds of U.S. economic activity.
FOX Business’ Bailee Hill contributed to this report.