Is Your Sales Growth Outpacing Inflation?

Although inflation declined in 2023, it still influenced convenience retailers’ financial performance, especially inside the store.

Is Your Sales Growth Outpacing Inflation?

June 2024   minute read

Inflation has been on the minds of (and affected the wallets of) every consumer over the last three years. Prices are influencing their decisions whether they are shopping for household groceries, paying utility bills or picking up lunch at their local convenience store. In this environment, the fear of sticker shock has become a reality.

The year 2022 ended with an inflation rate of 8.3%. The inflation rate fell almost a full five points in 2023 to 3.4%. While inflation fell, it still influenced convenience operators’ financial performance—especially inside the store.

To track the impact of inflation on convenience stores’ sales, NACS Research debuted the Convenience Consumer Price Index (CPI) at the 2023 State of the Industry Summit. Since then, NACS has continued to track this metric to help businesses understand how their sales are stacking up after inflation-fed prices are considered. By comparing changes in the average price per unit to average units sold using NIQ data as well as the U.S. Bureau of Labor Statistics CPI data, NACS Research calculated the percentage of sales increase that convenience retailers need to meet to see true sales growth.

In 2023, that CPI was 5.7% for merchandise and 8.9% for foodservice, meaning if your company saw merchandise sales or foodservice sales less than this percentage, you were not outpacing inflation.

Nationally, foodservice sales barely outpaced inflation in 2023, increasing by 9.0% in 2023. Merchandise sales increased by only 3.1%, showing that merchandise did not see true growth in 2023. This could be the product of fewer units sold or a shift to items with lower prices in stores.

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