Supermarket food prices have increased by more than 25% over the past two years according to the consumer group Which?, with the size of the rise reinforcing the case for retailers to be forced to display detailed price information on loyalty card offers and promotions so shoppers can find the best deal.
Which? said the government needed to close loopholes that result in “confusing and inconsistent” pricing practices of some supermarkets. Last month it reported Tesco to the UK’s competition watchdog because it does not provide unit prices – such as the price for each 100g or 100ml – for the loyalty card offers it uses as a sales tactic to pull in shoppers.
The absence of unit prices made it harder for Tesco shoppers to compare value for money between different sized packages, bottles and brands, Which? said. Its rival Sainsbury’s does this with its Nectar deals.
“Two years of relentlessly soaring food prices have had a devastating impact on households,” said Sue Davies, the Which? head of food policy. “This isn’t helped by the confusing and inconsistent pricing practices used by some supermarkets, which make it incredibly difficult to work out how to find the best value products.”
On Wednesday the Office for National Statistics (ONS) is due to publish inflation data for June, which is expected to show the headline rate eased to 8.2% from 8.7% in May – still well above the Bank of England’s 2% target.
The latest Which? tracker, based on the prices of 25,000 products across eight supermarkets, found that food and drink inflation was running at 15.4% in the 12 months to June, down from 16.5% in May. The highest inflation reading was for Lidl, at 21.4%, followed by Aldi on 19.3%.
The discounters also fared worst on a two-year measure with Aldi and Lidl recording inflation of about 35%. The average across all eight big chains is 25.8%.
However, analysts said the inflation readings for the discounters did not take into account their lower starting prices, and pointed to data from the grocery analyst Kantar that showed the average unit price had gone up 19p at Aldi compared with the market average of 22p.
Helen Dickinson, the chief executive of the British Retail Consortium, said retailers had worked hard to absorb cost increases during a period of “sky-high” inflation that had seen energy, labour, commodity, farm, and transport costs all rise significantly.
“In recent weeks we have seen the prices of some key staples, such as butter and bread, begin to fall, as fierce competition between retailers continues to help customers get the best value in their weekly shop,” she said.
The call for action on unit pricing comes before Thursday’s Competition and Markets Authority’s (CMA) update on its investigation into the issue. It is due to share the latest on a separate review of grocery pricing, amid accusations of greedflation in the food industry.
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At the start of this year the CMA announced it would revisit unit pricing. It conducted a similar investigation in 2015 when it recommended the government review and clarify the legal requirements, but no concrete action followed.
In a new Which? study on the topic Davies said it found that the way unit pricing was provided could often be confusing. This was because the rules – called the price marking order – at nearly 20 years old were out of date and retailers interpreted them in different ways, she suggested.
“Guidance should be urgently updated to make it clear how unit pricing should be provided for different promotions, including that it should be provided for loyalty card pricing,” Davies said. “Clear and transparent pricing is essential as people try to deal with the cost of living crisis.”
After the Which? criticism, in a recent blog post the Tesco UK chief executive, Jason Tarry, said: “We are going to bring forward some long-planned work to our Clubcard prices to make it simpler for our customers to see by weight or volume just how competitive those offers are, and will introduce unit pricing for simple promotions by early next year.”
