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Below is a brief excerpt from a complimentary research note written by our Consumer Staples analysts Howard Penney and Daniel Biolsi. If you are an institutional investor interested in accessing our research email sales@hedgeye.com |
Grocery inventories are slowly returning to pre-pandemic levels, as seen in the table below.
Widespread out of stocks in combination with fewer trips to the grocery store helped to change consumer shopping behavior during the pandemic. Out of stocks are highest in the frozen category and not an issue in alcoholic beverages and refrigerated food.
High out of stock levels caused consumers to be less brand loyal than in the past and look for substitute products. Consumers also were less price-sensitive as there were fewer selections to choose from.
With in-stock levels improving, brand loyalty and price sensitivity will become more important to the purchasing decision.
