We’re buying fewer little treats

Snacktime is becoming too expensive for a growing number of Americans, and General Mills is the latest munchies provider to recognize it. The food giant’s net sales dropped 5% globally last quarter and 7% in North America amid a “slowdown in snacking,” CEO Jeff Harmening said this week.

Join the club:

• JM Smucker (owner of Hostess and Jif) and Campbell’s (owner of Pepperidge Farm) also logged 2% and 3% net sales declines last quarter, respectively, that were tied to softer snack demand.
• Frito-Lay-owner PepsiCo reported its third straight quarterly revenue miss last month, citing a lag in “salty and savory snack categories.”
• Sales volume at US convenience stores fell 4.3% at the end of February from the same time last year.

This isn’t because of Ozempic, executives say. It’s financial:

• The average 16-ounce bag of potato chips has gotten 29% more expensive since 2021, while overall grocery prices have risen 23%, according to government data.
• Forty-two percent of US consumers are cutting back on snack purchases for price tag reasons, a February survey by the research firm NIQ found.
• Dog treat sales also declined in General Mills’s latest quarter, suggesting a larger pullback.

Zoom out: Amid persistent inflation and slowing wage growth, many US customers “only have enough money for basic essentials,” Dollar General’s CEO said this month.