UK grocery inflation falls, however cost-of-living disaster ‘isn’t over’; Whitbread faces protest over 1,500 job cuts – enterprise reside

Kantar studies that take-home grocery gross sales rose by simply 1.0% over the 4 weeks to 9 June 2024, which is the the slowest improve since June 2022.

That’s partly because of the slowdown in inflation (as costs rose at a slower charge), but additionally the poor climate in Might and June.

Kantar says the sixth wettest spring on record has harm the grocery sector too, with a lot much less demand for summer time objects reminiscent of suncream. As an alternative, we’ve been shopping for extra soup!

Kantar’s Fraser McKevitt explains:

We’re not but reaching for these typical summertime merchandise and are making some purchases you wouldn’t anticipate in June.

Shoppers purchased practically 25% fewer suncare objects this month in contrast with final yr, whereas ready salads dipped by 11%. Then again, warming contemporary soup gross sales jumped by nearly 24%.

Newsflash: UK grocery inflation has fallen for the sixteenth month in a row.

Knowledge agency Kantar studies that grocery store costs are 2.1% greater than a yr in the past this month, a slowdown on the 2.4% annual rise recorded in early May.

Kantar studies that costs are actually falling in practically one third of the grocery classes it tracks, reminiscent of bathroom tissues, butter and milk.

This slowdown in worth rises ought to deliver some aid to households, who have been hit by grocery inflation of 17% in March 2023.

However Fraser McKevitt, head of retail and shopper perception at Kantar, warns that the squeeze on budgets isn’t over.

“The fee-of-living disaster isn’t over – removed from it. 22% of households say they’re struggling, which means that they aren’t in a position to cowl their bills or are simply making ends meet.

“Nevertheless, there are optimistic indicators that many people now not really feel the necessity to prohibit our spending fairly a lot, with decrease inflation serving to to ease the stress on folks’s pockets.”

Good morning, and welcome to our rolling protection of enterprise, the monetary markets and the world economic system.

The lodge sector generally is a good gauge of financial confidence, monitoring whether or not persons are forking out for journeys away and if companies are stumping up for enterprise journeys.

And this morning, Premier Inn proprietor Whitbread has reported that latest buying and selling within the UK has been “extra encouraging”, because it prepares to face union anger over plans to chop 1,500 jobs.

The corporate says it stays “assured within the full yr outlook”, after rising complete gross sales by 1% to £739m, “pushed by improved UK buying and selling and continued progress in Germany”.

In its newest monetary outcomes, Whitbread studies that gross sales progress was flat (0%) within the UK for the 13 weeks to 30 Might 2024, though it did develop by 15% in Germany (the place buying and selling had been weaker).

That 0% determine, although, hides a pick-up after a weak begin to the primary quarter of Whitbread’s monetary yr.

The corporate instructed shareholders:

Having been 1% behind final yr within the first seven weeks, our buying and selling efficiency strengthened in the course of the the rest of the quarter and lodging gross sales recovered to be in keeping with final yr and up 55% versus FY20.

However, on a like-for-like foundation, lodging gross sales shrank by 2%, together with a 1% drop in meals & beverage gross sales.

Whitbread studies that midweek enterprise demand and peak leisure demand each stay “strong”, nonetheless last-minute demand for weekend stays has been “barely softer”, notably in London.

Maybe the post-pandemic surge in journeys away has pale?

Again in April, Whitbread reported sturdy outcomes for the final monetary yr, together with a 13% rise in gross sales within the yr to 29 February.

Whitbread additionally says internet inflation is now anticipated to be on the decrease finish of its steerage because of “elevated price efficiencies”.

The corporate, and its shareholders, will really feel the wrath of the Unite union later as we speak after they collect for its annual normal assembly at its places of work in Dunstable, Bedfordshire.

Unite are planning a protest over Whitbread’s plans, introduced in April, to chop 1,500 jobs.

The union says Whitbread have refused to seek the advice of with them, or reply fundamental questions on the redundancy course of.

Unite normal secretary Sharon Graham mentioned:

“Not often is an organization so shameless as to have fun leaping income and dividends by asserting mass job cuts.

“However producing runaway income whereas trampling employees is enterprise as regular for Whitbread. It is a agency that refuses to pay the actual dwelling wage and doesn’t even present firm sick pay for its underpaid and overworked employees.

“Unite will probably be holding the corporate to account for its disgraceful race to the underside behaviour and providing full assist to our members impacted by these merciless and pointless redundancy plans.”

The agenda

• 8am BST: Kantar’s grocery worth inflation

• 10am BST: Eurozone inflation charge for Might (closing estimate)

• 10am BST: ZEW index of German financial sentiment

• 1pm BST: Unite protest forward of Whitbread’s AGM

• 1.30pm BST: US retail gross sales for Might

• 2.30pm BST: Whitbread’s AGM begins