Major grocery chains in the US, including Kroger and Walmart, are slashing prices on thousands of products to win back shoppers who have turned to warehouse retailers like Costco and Sam's Club. The moves come as inflation surges past 4 percent for the first time in three years, with food prices rising 2.7 percent at grocery stores and 3.5 percent at restaurants year-over-year.
Kroger CEO Greg Foran announced the chain would lower prices on thousands of items, telling Bloomberg in May: “The reality is, the basket has to come down. It needs to be across thousands of products, and it has to be something that passes the commonsense piece with customers.” Walmart has also signalled further price cuts after reducing costs on more than 7,000 products in 2024.
Walmart's chief financial officer, John David Rainey, suggested using money from anticipated tariff refunds to help lower grocery bills. Companies are beginning to receive refunds for billions of dollars paid under Trump's tariff policy, after the Supreme Court struck down some tariffs as unconstitutional in February.
“We think that the single best return that we can have on a dollar of capital right now is to invest in the customer, invest in price,” Rainey told investors in May. Shoppers like Jessica Gavilanes from Phoenix told AZ Family: “I feel like now it’s easier to just go out to eat instead of buying groceries because it’s just going to cost just the same.”
