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MIDA study: Consumers worried about recession, cost of living hikes

Puerto Rican consumers who participated in the Chamber of Marketing, Industry and Food Distribution (MIDA, in Spanish)’s most recent survey confirmed increased concerns over a recession, the cost-of-living increases and gasoline prices, among other issues.

The trade group’s 30th annual Consumer X-Ray study’s results were expected “but what we didn’t expect was such a dramatic change in the level of those concerns when compared to 10 years ago,” said MIDA President Ferdysac Márquez.

“Inflation at unseen levels in the past 40 years, demographic changes, reduction in Nutritional Assistance Program (PAN, in Spanish) aid, an increase in fuel and interest rates, threat of recession, health services damaged by the pandemic and a supply chain affected by conflicts war and post-pandemic,” said Márquez, adding that all of those concerns put consumers in the eye of the “perfect storm.”

Specifically, the number of Puerto Ricans worried about a recession increased from 30% in 2012 to 86% in 2022, as the price of gasoline increased from 45% to 93%. Similarly, cost-of-living concerns increased from 65% to 91%, inflation concerns from 15% to 84%, and interest rates from 9% to 77%, said MIDA Executive Vice President Manuel Reyes.

The study, commissioned to Lighthouse Strategies, interviewed 1,350 heads of households during the months of March and April 2022. They confirmed that their main concerns were focused on economic issues.

Participants said that over the past 12 months, 78% of them cooked more at home, while 75% of them purchased less at the grocery store, where 66% of them were buying more supermarket private-label brands.

In the case of food and household products, the average monthly expense was $463, the highest in the past five years and up 14% from the $407 spent in 2021.

Richard Valdés, chairman of the Consumer X-Ray Committee, explained that this is mainly due to the inflationary effect and higher federal aid during the survey period, not necessarily to an increase in the number of products.

In the unprepared food item, protein was the most impacted and the study reflects that among consumers who cut their spending on food for economic reasons, 51% stopped buying red meat.

The number of store visits decreased, because “they spend more, but they go to stores less often and visit fewer stores than in previous years,” Valdés said.

As for the factors that they consider important when selecting food, 97% of the consumers surveyed mentioned quality, expiration date, taste, and price. For 81% of them, it is important that the product is “Made in Puerto Rico.”

In contrast to the increase in visits to pharmacies to buy food seen during the pandemic, this year the study reflected that this practice was the opposite. Those surveyed confirmed that their visits to pharmacies to buy food dropped from 12% in 2021 to 1% in 2022.

Likewise, 91% of those surveyed said they did not buy food in pharmacies, however, beyond grocery shopping, the study found that community pharmacies are effectively competing against the big chains.

When asked which pharmacies they visit most often, consumers were almost evenly split between 47% in community pharmacies and 48% in foreign chains.

As for alcoholic beverage purchases, the study reflects that beer is the most sought-after product in grocery stores, at 72%, while 35% opted for wine, and 29% for liquors.

This year’s study incorporated a digital survey carried out by the A&Answers division of Arteaga & Artega, in which 650 interviewees participated.

Of this sample of online purchases, 82% of participants said they chose mail delivery platforms, 48% chose platforms that deliver to the home, and 27% said they chose to pick up at the store.

As for food, 53% said they buy food online, 44% said they buy alcoholic beverages, and 48% household products.

On the other hand, 72% said they had increased or maintained their frequency of purchases of unprepared food on digital platforms last year and 86% plan to maintain or increase them in the coming months, which reflects satisfaction with these purchasing tools.

The results of the research will be presented Aug. 25, at 9:30 a.m. at the Puerto Rico Convention Center, as part of MIDA’s Conference and Food Show 2022.

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This story was written by our staff based on a press release.

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