Jacksonville, Fla., (December 10, 2019) - The trade war with the U.S. and China and resulting new tariffs have affected the grocery industry both positively and negatively, and future effects remain to be seen. The Impact of U.S. Tariffs on the Grocery Industry, a new report from Acosta — a leading full-service sales and marketing agency in the consumer packaged goods industry — reveals how tariffs influenced grocery item prices since late summer 2019 and shares the perspectives of consumers, manufacturers and retailers.
“Tariffs are already impacting the average consumer and are expected to escalate. U.S. tariffs imposed on China have cost the average American household $600 per year, and that impact is expected to rise to $1,000 per year if the late 2019 tariffs take effect,” said Colin Stewart, Executive Vice President, Business Intelligence at Acosta. “It’s a difficult situation for manufacturers and retailers as well. Manufacturers are at the mercy of government decisions, and it is creating friction between manufacturers and retailers as to who will bear the costs of price increases.”
Acosta’s The Impact of U.S. Tariffs on the Grocery Industry report investigates this hot topic, highlighting:
Impact on Shoppers
· Shoppers are already paying more for various grocery items, including six percent more on pork, five percent more on yogurt and writing tools/supplies and four percent more on fruit.
· Most consumers (40 percent) view tariffs as a negative for the country.
· Most shoppers are worried about price increases — only 11 percent of consumers reported not being concerned about tariffs making products more expensive.
· Seven in 10 shoppers believe tariffs have increased prices on everyday grocery products.
· The impact on manufacturers is highly dependent on the product line, sourcing and manufacturing location. CPG companies with U.S. based manufacturing are gaining an advantage.
· Providing adequate notice to retailers for price increases can be a struggle due to being at the mercy of government decisions, which often occur with limited or no notice.
· The level of willingness to accept price increases varies by retailer. Many expect manufacturers to bear the cost.
· Most retailers compare potential price increases to their commodity costs on their private label items.
Acosta’s The Impact of U.S. Tariffs on the Grocery Industry report was compiled using industry data and proprietary information sources including online surveys of the company’s proprietary shopper community, manufacturers and retailers. To access the full report, visit www.wycocd.com/news.
Acosta is the sales and marketing powerhouse behind most of the trusted brands seen in stores every day. The company provides a range of outsourced sales, marketing and retail merchandising services throughout the U.S., Canada and Europe. For 90 years, Acosta has led the industry in helping consumer packaged goods companies move products off shelves and into shoppers’ baskets. For more information, please visit www.wycocd.com.