Grocery Sales Rose in March

Underscoring the challenges of predicting behaviors and outcomes in a still-volatile market, the latest retail sales numbers from the U.S. Census Bureau came in above analyst expectations. The news follows last week’s hotter-than-expected overall inflation rate as reported by another federal agency, the U.S. Bureau of Labor Statistics.

According to Census Bureau data, total retail and foodservice sales rose 0.7% from February to March for a 4% lift over March 2023 numbers. On a sector basis, adjusted retail sales at grocery stores ticked 0.5% higher last month, from $74.1 billion to $74.5 billion. On a year-over-year (YoY) basis, grocery store sales are up 1.1% from the $73.5 billion recorded in March 2023.

For the first three months of 2024, overall retail and foodservice sales are 3.3% higher than in 2023. Grocery store sales gained 2.8% compared to the prior year. 

“Overall, retail sales in March were much better than expected with an uptick of 0.7%, more than double of what many economists had forecasted. The Easter holiday did fall in March this year, which may have contributed to this steady rise in spending,” pointed out Chip West, a retail and consumer behavior expert at marketing tech company Vericast. 

The National Retail Federation (NRF) recently released its own sales data for March, indicating a 0.36% gain in total retail sales, excluding automobiles and gasoline, and a 1.17% monthly hike in sales at grocery and beverage stores. 

NRF President and CEO Matthew Shay provided a reality check on those findings. “As inflation for goods levels off, March’s data demonstrates steady spending by value-focused consumers who continue to benefit from a strong labor market and real wage gains,” he observed. “In this highly competitive market, retailers are having to keep prices as low as possible to meet the demand of consumers looking to stretch their family budgets.”

According to West, grocers can leverage conditions for additional growth as consumers remain mindful. “With restaurant prices rising, grocery has a big opportunity to regain consumer wallet share as many shoppers are presented with more cost-effective options than dining out. In March, food prices at supermarkets stabilized and in the long-run, consumers are going to go where the best value is,” he noted.