Discount supermarket chains are putting the squeeze on grocery prices. That's great news for consumers, but not so great for grocers' profits and company shares.
It’s likely you’re shelling out less money to pay for groceries than you have in the past.
According to Business Insider, many of America’s big supermarket chains are reducing their prices amid “ongoing food-price deflation and growing pressure” from the proliferation of discount grocery chains like German-owned discount chain Aldi.
Although slashed prices at the grocer typically offer shoppers a reason to celebrate, it’s not surprising that the grocery stores themselves don’t seem as thrilled. The continued price cuts continue to squeeze profits and tug down company shares.
Business Insider says Whole Foods, Kroger, Sprouts Farmers Market and Dollar General have experienced a collective 13 percent dip in stock prices over the last three months.
In a price check last year, Business Insider found Aldi’s prices were about 30 percent lower than Walmart’s.
To help prevent stores like Aldi from wooing their customers away with low prices, Business Insider says Kroger has decreased the cost of 1,000 popular grocery items in many of its stores. Dollar General, Trader Joe’s and Walmart have also worked to slash prices this year.
Aldi has 1,500 stores in the U.S. now, with plans to construct 500 more stores over the next two years.
Lidl, another German-based discount supermarket chain, also plans to open up shop in the U.S. The company told Business Insider that it has plans to open stores in “dozens of cities” in the U.S.
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