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Grocery affordability hits crisis point for households

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The burden of grocery expenses on Australian households has surged, with findings from Finder revealing a distressing trend.

According to the latest data from Finder’s Consumer Sentiment Tracker, a staggering 42% of Australians, equivalent to 3.9 million households, cite their grocery bill as a significant financial stressor. This marks a substantial increase from 26% or 2.4 million households, reported just two years ago.

Amid this concerning rise in financial strain, a new survey conducted by Finder unveils that 92% of Australians have adopted various shopping tactics to alleviate the pressure on their wallets. The survey, comprising 1,002 respondents, indicates a widespread effort to save money at the checkout counter.

Kitchen essentials

The research highlights that over half of the shoppers (53%) resort to bulk buying kitchen essentials to cut costs, while 61% of respondents, equivalent to 5.6 million households, opt for visiting multiple grocery stores to seek better deals. Additionally, more than one-third (38%) of shoppers utilise coupons to secure discounts.

Graham Cooke, head of consumer research at Finder, underscored the dire situation faced by millions of Australians, stating, “Many are struggling to afford the bare necessities and don’t want to pay more than they need to for food.” Cooke emphasised that the current cost of living crisis is exacerbating financial pressures on households, leading to heightened stress levels.

Year to year

The average weekly expenditure on groceries per Australian household in January reached $188, marking a $10 increase from figures reported two years prior.

This translates to a substantial $520 hike in annual grocery spending per household, totaling a staggering $4.8 billion nationwide across Australia’s 9.275 million households.

Cooke advised consumers to exercise caution and explore options to mitigate expenses.

He suggested strategies such as reducing the frequency of grocery trips to minimise impulse purchases, opting for generic brands where feasible, and leveraging online shopping apps offered by major supermarkets to compare prices effectively.

As Australians grapple with the escalating costs of living, the findings underscore the urgent need for households to adopt savvy shopping practices to navigate the grocery affordability crisis effectively.

Ahron Young is an award winning journalist who has covered major news events around the world. Ahron is the Managing Editor and Founder of TICKER NEWS.

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Money

Brad Banducci quits as Woolworths Australia CEO after TV blow-up

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Woolworths CEO Brad Banducci has revealed his decision to step down from his position, with Amanda Bardwell, head of loyalty and e-commerce, slated to succeed him as chief executive in September.

Bardwell’s appointment marks a historic moment as she becomes the first woman to lead the company in its nearly 100-year history.

Banducci’s departure comes at a critical juncture for Woolworths and its competitor, Coles, as they brace for an upcoming Senate inquiry led by the Greens.

The inquiry, scheduled for next month, is expected to scrutinise higher grocery costs, which Canberra has blamed for inflating supermarket profit margins at the expense of consumers.

Supermarket investigation

In addition to the Senate inquiry, Labor has urged the competition regulator to investigate the supermarkets, with Prime Minister Anthony Albanese suggesting potential abuse of market power by the retailers.

Woolworths chairman Scott Perkins clarified that Banducci’s succession timeline was not accelerated in response to the scrutiny faced by the supermarket industry.

Perkins stated that interviews with potential candidates for the CEO position had been ongoing since the latter half of the previous year.

“There has been an ongoing dialogue with Brad,” Perkins told media. “There was no change to the timetable, no expedition at all.”

Importance of authenticity

Banducci acknowledged that he had considered delaying his departure but ultimately decided against it, citing the importance of authenticity. Despite the challenges facing the industry, he expressed confidence in Bardwell’s ability to lead Woolworths into the future.

Analysts reacted to the news with a mix of surprise and caution.

In financial terms, Woolworths’ food retail division reported a 5.2 percent increase in sales, or 6.6 percent excluding tobacco.

However, the company noted a moderation in prices, with average increases of 1.3 percent in the last three months of 2023.

Despite this, margins continued to improve, and earnings for the division rose by 8.2 percent.

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Money

Walmart reports holiday sales as shoppers seek better value

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Walmart disclosed its fourth-quarter earnings showcasing a surge in sales during the holiday season, offering early insights into consumer spending trends amid a crucial period.

Despite a challenging economic climate, Walmart reported a 4 percent increase in comparable store sales for the three months ending in late January compared to the previous year.

The number of transactions also saw a notable uptick, rising by 4.3 percent. However, there was a slight decline of 0.3 percent in the average ticket price, indicating a tendency among shoppers to spend marginally less during their shopping trips.

The retail behemoth witnessed a significant boost in its online sales, with a 17 percent increase in the U.S. market and a remarkable 23 percent surge globally, surpassing the $100 billion mark. Walmart’s Chief Financial Officer, John David Rainey, attributed this growth partly to cost-saving measures in their e-commerce operations and the rising adoption of Walmart’s delivery services.

Discretionary purchases

While the e-commerce sector saw substantial gains, there was a noted decrease in discretionary purchases such as electronics, as consumers prioritized essential items amidst economic uncertainties.

Walmart’s emphasis on value and affordability played a pivotal role in driving sales, particularly in its grocery segment.

The company’s CEO, Doug McMillon, highlighted Walmart’s commitment to offering competitive prices, leveraging its substantial grocery business.

In a strategic move to enhance its offerings, Walmart announced the acquisition of television manufacturer Vizio in a deal worth $2.3 billion, further expanding its Walmart Connect advertising and media business.

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Money

Millions of Australians are struggling with credit card repayments

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Recent research has revealed a concerning trend: a significant number of Australians are falling behind on their credit card repayments, highlighting the financial strain faced by many households.

According to Finder’s Credit Card Report 2024, approximately 13% of Australian credit card holders, equivalent to nearly 1.8 million individuals, have missed at least one repayment in the past three months.

Of this group, 8% have fallen behind by 30 days, while 4% have missed payments by 60 days.

Read more – Is Paypal bringing back old school credit cards?

Alarmingly, 2% of cardholders have delayed repayments by more than 60 days.

Prevalent misuse

Amy Bradney-George, a credit card expert at Finder, expressed concern over the prevalent misuse of credit cards, attributing it partly to the escalating cost of living.

Bradney-George warned that missing a credit card payment often incurs late fees and interest charges, exacerbating financial burdens for individuals.

Bradney-George emphasised the detrimental impact of late payments on credit scores.

She highlighted that a missed payment can be recorded on a credit file within just 14 days, potentially affecting an individual’s ability to secure loans or new credit cards in the future.

With details of late payments lingering on credit reports for up to two years, the consequences could be long-lasting.

Currently, there are over 13 million credit cards in circulation across Australia, accumulating a national debt of $18.1 billion subject to interest charges.

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