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Consumers’ Recession Shopping Habits

Chicken producers are in a strong position to ride out the recession, Ton Marino, a vice-president and regional manager for The Neilson Company told the annual meeting of the Ontario Broiler Hatching Egg and Chick Commission here recently.

Despite retail price increases, he said chicken ($6.87 per kilogram) remains less expensive than pork ($7.11 per kilogram) and beef (more than $9 per kilogram), so it’s attractive to shoppers who are working harder to find bargains.

Only turkey, at $4.81 per kilogram, is cheaper, he said, “and it tends to be seasonal.”

Grocery prices increased by seven per cent, year over year, by the end of last year, he said, with more than half of that increase in the last 12 weeks.

He said Neilson company surveys indicate that 64 per cent of households say they are spending less on household necessities, 87 per cent of Canadians are concerned about food prices and many people are “putting on the brakes and spending less.”

Grocery store revenues have dropped by five per cent, but club stores (e. g. Costco) revenues have increased by one per cent.

There has been a substantial shift from brand name to generic products, he said.

Thirty-seven per cent of shoppers are looking for sales and bargains now, he said. Fourteen per cent are willing to switch brands and 11 per cent “are panic stricken,” Marino said.

The demand for many foods is “recession proof,” he said, among them meat, seafood, laundry detergent, pet food, ready-to-eat cereals and coffee.

When it comes to products and prices that prompt shoppers to switch stores, Marino said diapers account for 25 per cent of the shifting, followed by personal paper products, laundry detergent and hair-care products.

Marino said the Neilson research and shopper survey data indicate that the chicken industry “is in a better position than most industries I speak with… to come through this turmoil.”

He cautioned the producers to keep a tight rein on costs.

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