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Consumer Lifestyles in Argentina: High Food Prices Drives

Change in Shopping Habits
Opinion | 01 Aug 2014
Je nnife r Els te r

The numbers are there for all to see. In 2013, consumer expenditure

on food and non-alcoholic beverages in Argentina reached

ARS35,132 per household, up by 39% (in real terms) from 2009.
On the other hand, if you listen to the International Monetary Fund,
numbers relating to prices and inflation in Argentina may not be
what they seem. Certainly, food prices have been skewed by the governments recently introduced Precios
Consumer Lifestyles' Manager

Cuidados (Price Watch) programme which strongly encourages supermarkets to freeze prices on a select
group of key food items regardless of their true cost. And while the government says inflationwhich has a
disproportionate impact on food pricesreached a rate of 10.9% in 2013, many economists and other
observers set the rate at more than double that rate.

Consumer Expenditure on Food and Non-Alcoholic Beverages and Inflation

Source: Euromonitor International

Source: Euromonitor International

So how are consumers changing their food shopping habits in response to the seeming chaos in the
grocery aisles? As you might expect, in a variety of ways. Many shoppers, believing along with the
government that rising food prices are the result of efforts by greedy food companies to prey on consumers
Dont let them rob you President Cristina Fernndez de Kirchner recently told a group of supporters
have resorted to policing local supermarkets to monitor food prices. Indeed, one of the most popular
smartphone apps in the country, Precios OK (Okay Prices), allows the shopper to scan barcodes on food
items and instantly report those not adhering to the Precios Cuidados guidelines. Food shopper Analia
Becherini told Canadian Business magazine You can go checking the pricesYou dont even have to
make any phone calls. If you want to file a complaint, you can do it online, in real time.
Others are responding by taking what might be considered to be a more practical approach: eschewing the
weekly shop in supermarkets and hypermarkets altogether and shopping instead in local, smaller grocers
and buying only what they need for the next few days. Additionally, a growing number of consumers have



Euromonitor International - Analysis

switched to doing their shopping at less-expensive food wholesalers. According to a recent article in
Mendoza-based newspaper Los Andes, wholesale supermarket sales have increased by 30% over the
first six months of 2014, a result of consumers recognising that they can save between 20% and 25% on
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their grocery bills by buying in bulk rather than continuing to rely on their weekly shops at their local
supermarkets. Even taking into consideration the 3% to 4% surcharge they must pay at wholesalers,
consumers find they are paying significantly less.
And this trend towards wholesalers is expected to grow. According to Los Andes, Wholesalers have
studied the family segment and seek to further improve their sales with promotions, brochures and
magazines that they deliver free of charge to the customers' houses or onlineWholesaler Oscar David,
located in Godoy Cruz, stressed that much of their clientle was made up by families that bought more than
the minimum 1,000 pesos purchase required by the firm, as they were shopping for the entire month.
Wholesalers have also become more consumer-friendly by now accepting personal financial cards for
No doubt, food shoppers in Argentina will find that they will be forced to continue to find creative ways to
affordably put food on the table for some time to come. Argentinas recent debt default will certainly not
have an immediate impact on consumers or, for that matter, on food prices, but it is clear that the default
will make it more difficult for the country to solve its macroeconomic problems, a situation which would
certainly affect consumer expenditure and prices in the longer term.
Further analysis has been drawn together by Euromonitor Internationals Consumer Lifestyles analysts. To
read the full report click here.
For further information please contact Jennifer Elster, Consumer Lifestyles' Manager at Euromonitor

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