‘Customers trading down, cutting back non-essential spending’

Nine in 10 consumers still plan to cut back non-essential spending despite the energy cap freeze introduced by the government this month, stated a report today, highlighting that around half of UK consumers are trading down to value alternatives as a result of the ongoing cost-of-living crisis.

According to the Retail Economics-Hyper Jar Cost of Living Tracker, consumers are being more price-conscious, evidenced by half of households (46.9 per cent) trading down to value items and almost two in five (38.7 per cent) using voucher codes more often to stretch their spending power. 

The research also found that 37.5 per cent of consumers are delaying large purchases and buying essentials in smaller quantities (30.7 per cent) as prices rise faster than earnings. 

The report added that nine out of 10 consumers still plan to cut back non-essential spending, despite the energy cap freeze introduced by the government this month. 

“The government’s announcement has had very little impact on confidence levels as we all continue to adjust our spending patterns to cope with an extraordinary set of challenges,” HyperJar CEO Mat Megens said. 

“This nervousness is clear from the longer-term planning behaviour we see among our own customers – from putting money aside for hikes in energy costs to saving up for Christmas and summer holidays now. 

“Although inflation is a new phenomenon for many of us, the country has been here before and it’s possible to navigate this period with careful planning and some smart, manageable changes in habits.” 

The report comes after latest official figures showed that inflation in the country slipped marginally to 9.9 per cent though essential food prices are still rising at high rates. 

The biggest push in inflation came from food and non-alcoholic drinks whose prices rose at an annual rate of 13.1 per cent in August, up from 12.7 per cent in July, marking the highest rate since August 2008. The largest upward effect came from milk, cheese and eggs.