Study: Most grocery shoppers prefer store brands
New York – A study released Tuesday by Accenture found that, in the grocery arena, store brands continue to steal sales from brand-name products.
According to Accenture’s poll of 500 U.S. consumers, 64% said their grocery carts were at least half full of store-brand products, and 39% said they have increased their purchase of store-brands in recent years as a result of the tough economic times.
Price remains the key factor in the majority of store-brand purchases. Two thirds (66%) of shoppers said they buy store-brands because they are cheaper. Also, while 87% of shoppers said they would buy more brand-name products if they were offered at the same price as the comparable store-brand, 51% said that it would take a permanent price reduction of the brand-name product – to the same price as the store-brand – to persuade them to return to purchasing the brand-name product.
Half of consumers surveyed said they buy store-brand products because they perceive the quality to be just as good as the brand-name equivalent, 42% buy a private-label product because they “trust” that particular store’s brand, and 28% simply prefer the store-brand product to the brand-name product. Just 9% claimed not to buy store-brands because they felt that the quality or taste was inferior to the brand-name product.
“Consumer goods companies must respond to the threat of increasing competition from store-brands as market position and profitability are at stake,” said Bob Berkey, from Accenture’s Consumer Goods & Services practice. “Extreme competition between retailers and consumer goods companies can result in inefficiencies and waste for manufacturers and retailers, and undifferentiated products for the consumer.”
More than three-quarters (77%) of shoppers said they would not decrease the amount of store-brand products they buy even if their disposable income were to return to the same level as it was before the economic downturn.
Tuesday Morning Q4 sales, comps up; expects to narrow loss
Dallas – Tuesday Morning Corp. reported Tuesday that sales for the quarter ended June 30 edged up 0.8% to $196.4 million, compared with $194.8 million in the year-ago period.
Same-store sales rose 0.2%, comprised of a 2.7% decrease in traffic and a 2.9% increase in ticket. For the fiscal year ended June 30, 2012, net sales were $812.8 million compared to $821.1 million for fiscal 2011.
Based upon the results of the fourth quarter, Tuesday Morning said it expects to narrow its Q4 loss from last year’s quarter.
"We are well positioned with respect to inventory and cash as we transition into a new era," said Michael Marchetti, president and interim CEO.
PriceSmart Q3 profit falls 4%
San Diego – Warehouse club operator PriceSmart Inc. reported Tuesday that net income for the third quarter slipped 4% to $15.7 million, compared with $16.3 m million last year.
Revenue rose 18% to $506.8 million from $431.1 million, missing Wall Street’s forecasted $508.2 million. Same-store sales increased 12.9%.