Retail Channel $ Update – March Monthly & April Advance

/in /by

In April, YOY Commodities’ inflation rose to 4.6% from 3.4%. Growing current inflation rates or just high cumulative inflation vs 21 can both impact consumer spending and slow $ales growth.  We saw evidence of this in April. Total Retail $ were +4.6% vs 25, 1.7% below the average 92>25 lift. However, Relevant Retail was +5.0%, 7.3% above the April avg. The situation is definitely complex and there is still a long road to full recovery. We’ll continue to track the retail market with data from 2 reports provided by the Census Bureau and factor in a targeted CPI.

The Census Bureau Reports are the Monthly and the Advance Retail Sales Reports. Both are derived from sales data gathered from retailers across the U.S. and are published monthly at the same time. The Advance Report has a smaller sample size so it can be published quickly – normally, 2 weeks after month end. The Monthly Report includes data from all respondents, so it takes longer to compile the data – about 6 weeks. Although the sample size for the Advance report is smaller, the results over the years have proven it to be statistically accurate with the Monthly reports. The biggest difference is that the full sample in the Monthly report allows us to “drill” a little deeper into the retail channels.

We will begin with the March Monthly Report and then go to the April Advance Report. Our focus is comparing to last year but also 21 & 19. We’ll show both actual and the “real” change in sales as we factor inflation into the data.

Both reports include the following:

  • Total Retail, Restaurants, Auto, Gas Stations and Relevant Retail (removing Restaurants, Auto and Gas)
  • Individual Channel Data – This is more detailed in the Monthly reports, and we’ll focus on Pet Relevant Channels.

The data will be presented in detailed charts to facilitate visual comparison between groups/channels. The charts will show 11 separate measurements. To save space they will be displayed in a stacked bar format for the channel charts.

  • Current Month change – % & $ vs previous month
  • Current Month change – % & $ vs same month last year and vs 2021.
    • Current Month Real change vs last year and vs 2021 – % factoring in inflation
  • Current Ytd change – % & $ for this year vs last year, 2021 & 2019.
    • Current Ytd Real change % for this year vs last year and vs 2021 and 2019
  • Monthly & Ytd $ & CPIs for this year vs last year and vs 2021 which are targeted by channel will also be shown. (CPI Details are at the end of the report)

First, the March Monthly. All were up from February and there was only 1 actual sales drop – monthly vs 25 in Auto. We should note: Gas Stations are selling a little less product than in 2019. Also, Relevant Retail is all positive again. They’ve been all positive in 22 of the last 24 months. ($ are Not Seasonally Adjusted)

The March Monthly is $1.2B more than the Advance report. Restaurants: -$0.1B; Auto: +$0.5B; Gas Stations: -$0.8B; Relevant Retail: +$1.5B. Every group had a double digit % increase in the $ales lift vs February. A Feb>Mar increase in Total Retail  has happened in every year but 2020 since 1992. Plus, the 16.0% lift was 16.6% more than the 13.7% avg. There was 1 drop in actual sales – Monthly vs 25 for Auto. There were 7 “real” sales drops. In Dec>Feb there were none. Only 2 groups were all positive, down from 4 in Feb. Restaurants still have the biggest increases vs 21 & 19 but Relevant Retail stayed at the top of “real” performance vs 2019. However, only 53.1% of their growth is real.

Now, let’s see how some Key Pet Relevant channels did in March in the Stacked Bar Graph Format

Overall– All 11 were up from Feb. Vs Mar 25, 10 were actually and 6 “really” up. Vs Mar 21, 8 were up but only 5 were real lifts. Vs 2019, Only Dept Strs & Off/Gift/Souv were actually & really down.

  • Building Material Stores – The pandemic focus on home has produced $ growth of 35.2% since 2019. Prices for the group are +25.8% from 21 and +29.1% from 2019, which is impactful. With a Spring lift, HomCtr/Hdwe Sales vs Feb were +26.8% and +42.2% for Farm. Vs other years, HomCtr/Hdwe are actually up & really down for all but 2019 & vs Mar 21. Farm stores are actually up for all, but their Real $ were down vs 21. Bldg Mat’s 19>26 real growth was 5.1%. avg: 0.7%. HomeCtr/Hdwe: Ytd: 3.5%; Avg 19>26 Growth: 4.1%, Real: 0.4%; Farm: Ytd: +7.4%; Avg: 6.1%, Real: 1.9%.
  • Food & Drug – Both are essential. Except for the COVID food binge, they tend to have smaller changes in $. Vs Feb: Supermarkets: +9.3%; Drug: +11.2%. In terms of inflation, the Groceries rate is 6.3 times higher than Drug/Med products. Drug Stores are positive in all measurements and 67.5% of their 2019>26 growth is real. Supermarkets’ actual $ are up in all comparisons, but they are only “really” up vs 2019. Plus, only 6.6% of their 19>26 increase is real growth. Supermarkets: Ytd: +0.6%; Avg 19>26: +4.3%, Real: +0.3%; Drug Stores: Ytd: +2.5%; Avg: +4.8%, Real: +3.4%.
  • Sporting Goods Stores – They also benefited from the pandemic in that consumers turned to self-entertainment, especially sports & outdoor activities. Sales are +29.4% from Feb, but they are actually & really negative vs 21 and real vs Mar 25. Prices stopped deflating vs last year. Deflation started in April 23 and was a big change from +1.1% in 22>23 & +7.9% in 21>22. This caused 69% of their 44% lift since 2019 to be real. Ytd: 5.3%; Avg 19>26: +5.3%; Real: +3.8%
  • Gen Mdse Stores – $ vs Feb: SupCtr/Club; +13.8; $ Strs: +17.0%; Dept Strs: +25.0%. All YOY comparisons were up for $ Strs & SupCtr/Club. Dept Stores are negative for all but actual vs Mar 25 & Ytd vs 21. Their Actual sales are even -32.0% from 19 (real:-39.7%). The other channels have an average of 41.9% in real growth. SupCtr/Club: Ytd: +2.4%; Avg 19>26: 4.8%, Real: 2.2%; $/Value Strs: Ytd: +5.6%; Avg: +5.3%, Real: +2.7%; Dept. Strs: Ytd: -4.3%; Avg: -5.4%, Real: -7.0%.
  • Office, Gift & Souvenir Stores– Sales are +18.8% from Feb. They are actually up Mar/Ytd vs 21. All others are down. Their recovery started late. It was slowly restarting in Jun/Jul, but their progress had slowed. It took off in Oct, slowed in Nov, grew in Dec, then slowed in Jan>Mar. Recovery takes some time. Ytd: -1.1%; Avg Growth Rate: -0.4%, Real: -2.1%
  • Internet/Mail Order – Sales are +14.2% from Feb to $127.1B, a Mar record. All YOY measurements are positive, but their YOY growth, +10.4%, is only 72.7% of their average since 2019. However, 81.6% of their 154.5% growth since 2019 is real. Ytd: +10.4%; Avg Growth: +14.3%, Real: +12.4%. As expected, they are by far the growth leader since 2019.
  • A/O Miscellaneous – Pet Stores are 22>24% of total $. In May 2020 they began recovery which reached $100B for the 1st time in 21. In 22 their $ dipped in Jan, Jul, Sep>Nov, rose Dec, fell Jan>Feb 23, grew Mar>May, fell Jun>Aug, rose Sep>Nov, fell Dec>Jan 24, grew Feb>May, fell Jun>Sep, grew Oct, fell Nov, rose Dec, fell Jan>Feb, grew Mar>May, fell Jun>Sep, rose Oct, fell Nov, rose Dec, fell Jan, rose Feb/Mar. All comparisons are positive, and they are #2 in the increase vs 2019 & vs 2021. Also, 78% of their 100% growth since 2019 is real. Ytd: +13.2%; Avg 19>26: 10.4%, Real: +8.6%

Mar had its usual lift vs Feb, but the Rel Retl lift was 14.8% above avg. All 11 small channels were up. The YOY lift vs 25 was 3% below avg for Total, but 35% above avg for Relevant Retl. 4 big groups & 10 smaller channels had lifts. Also, prices are only deflating in Auto, but cumulative inflation has an impact, as only 5 of 11 channels were really up vs Mar 21. The Recovery is slow. In Apr, the commodities CPI rose from 3.4% in Mar to 4.6%. Let’s see if it impacts Retail.

Only Gas Stations had a Mar>Apr lift. A Mar>Apr Total Retail drop has happened in 85% of the years since 1992. The -0.7% drop is 63% less than the -1.8% avg. There was only 1 YOY $ drop, the same as Mar. 4 Big Groups were up vs 25 but the Total Retail lift of 4.6% vs Mar 25 was 1.7% below their +4.7% 92>25 avg. However, the Relevant Retail 5.0% increase vs Mar 25 was 7.3% above their +4.6% avg. Inflation is still a factor. The CPI for all commodities rose to 4.6% from 3.4% in Mar and it is still +20.7% vs 21. There is some bad “real” news. In Jan/Feb, no “real” measurement was down. In Mar there were 7 & in Apr, 8. Plus, Gas Stations are still selling less Gas than in 2019. Also, again only 2 Big Groups are all positive. In Dec>Feb there were 4. Positive Note: Relevant Retail has now been all positive in 23 of the last 25 months.

Overall Inflation Reality– The Total Retail CPI rose to 4.6% and the $ lift vs 25 was 1.7% below avg. The Restaurant CPI slowed to +3.6% but their $ lift was 47.6% below avg. The Gas CPI rose from 18.9% to +29.1%. They are still in turmoil. Auto inflation is  -0.8% vs 25 but +13.7% vs 21. Sales were -1.1% vs 25. Their avg change is +4.5%. Inflation rose to 2.7% for Relevant Retail but their lift was 7.3% above avg and they are again all positive. Big Group progress is slow in 2026.

Total Retail – Since Jun 20, every month but Apr 23, Jun 24 & Feb 25 has set a monthly $ record. In 23>26, Sales got on a roller coaster. Up Oct>Dec, down Jan 24, up Feb>Mar, down Apr, up May, down Jun, up Jul>Aug, down Sep, up Oct>Dec, down Jan>Feb 25, up Mar, down Apr, up May, down Jun, up Jul>Aug, down Sep, up Oct, down Nov, up Dec, down Jan & Feb, up Mar, down Apr. Prices are 4.6% and YOY $ are +4.6%, 1.7% below avg. 42% of 19>26 growth is real. CPIs rose, but cumulative inflation may have the biggest impact on sales. Growth: 25>26: 4.1%; Avg 19>26: +6.1%, Real: +2.8%

Restaurants – They were hit hard by the pandemic and didn’t begin recovery until March 2021. However, they have had strong growth since then, exceeding $1T for the 1st time in 2023. Apr $ are up vs 25 and they have the biggest lifts vs 21 & 19. Inflation slowed to 3.6% vs last year, but it is +29.9% vs 21 and +35.5% vs 19. Their 3.0% YOY lift is 47.6% below their +5.6% 92>25 avg. In Mar/Apr they stopped being all positive and in Apr just 32.5% of their 63.4% growth since 2019 is real. They stayed 4th in performance. Recovery started late but inflation started early. Growth: 3.5%; Avg 19>26: +7.3%, Real: +2.7%. They just account for 13.6% of Total Retail $, but their strong growth has helped Total Retail.

Auto (Motor Vehicle/Parts Dealers) – They overcame the stay-at-home attitude with deals & advertising. They finished 2020 up 1% vs 2019 and hit a record $1.48T in 2021 but much was due to high prices. In 22, sales got on a rollercoaster. Inflation started to drop mid-year, but it caused 4 down months in $. Their YE real 22 sales numbers were even worse, -8.2% vs 21 and -8.9% vs 19. 23 started a sales rollercoaster but the $ hit a record, $1.595T. $ fell in Jan 24, grew Feb & Mar, fell Apr, grew May, fell June, grew Jul>Aug, fell Sep, grew Oct, fell Nov, grew Dec, fell Jan>Feb 25, grew Mar, fell Apr>Jun, rose Jul>Aug, fell Sep, rose Oct, fell Nov, rose Dec, fell Jan, rose Feb, fell Mar/Apr. Apr $ were -1.1% vs 25. Avg: 4.5%. Like Mar, Apr is not all positive and just 35% of 19>26 growth is real. Growth: 0.03%; Avg 19>26: +5.1%, Real:+2.0%

Gas Stations – Gas Stations were hit hard by “stay at home”. They started recovery in Mar 21, and inflation began. Sales got on a rollercoaster in 22 but set a record, $583B. Inflation started to slow in Aug and prices slightly deflated in Dec & Feb 23, then strongly fell in Mar>Jul to -20.2%. In Sep they were +2.7% but began deflating to -4.2% in Feb 24. In Mar>May $ grew, fell Jun, rose July, fell Aug/Sep, rose Oct, fell Nov>Feb 25, rose Mar>May, fell Jun, rose Jul, fell Aug>Oct, up Nov, fell Dec/Jan, rose Feb>Apr. Apr $ vs 25: +21.2% (4.4% avg). No $ downs. All real $, but Ytd vs 25 & 21 are down. Growth: +9.3%; Avg 19>26:+4.3%, Real: -0.3%. They show the impact of inflation can be “really” negative.

Relevant Retail – Less Auto, Gas and Restaurants– They account for ≈60% of Total Retail $ in a variety of channels. Their only down month until Feb 25 was Apr 20, and they led the way in Retail’s recovery. Sales got on a roller coaster in 22, but all months set new records with Dec reaching a new all-time high, $481B, and an annual record of $4.81T. In 23, the roller coaster continued. A Dec lift set a new monthly record of $494.7B & an annual record of $4.997T. The roller coaster restarted in 24. The ride continued as $ rose Oct>Jan 25, fell Feb, rose Mar>May, fell Jun, rose Jul, fell Aug & Sep, rose Oct>Dec, fell Jan>Feb 26, rose Mar, fell Apr. The Apr 5% YOY lift is 7.3% above their 92>25 avg of +4.7%. They are all positive again and 53% of their 54.5% 19>26 growth is real, again #1 in performance. Growth: 5.0%; Avg 19>26: +6.4%, Real: +3.7%. In 2024 their inflation rate fell from 3.2% to 0.1%. It rose in 25 to 1.8% in Sep, slowed to 1.5% in Oct>Nov, rose to 2.0% in Dec>Jan, 2.3% in Mar & 2.7% in Apr. YOY Inflation is low, but its cumulative impact can slow growth.

As expected, Apr sales fell vs Mar. Total Retl was -0.7%, 63% below avg; Relevant Retl was -0.7%, 35% below avg. In Apr, 1 actual YOY $ comparison was negative, the same as Mar but 1 less than Dec>Feb. There were 0 real drops in Dec>Feb. In Mar, there were 7. Apr had 8. In Dec, all were up vs last year but only Rel. Retl’s lift was above avg. In Jan, 3 lifts, all below avg. In Feb, 4 lifts, all below avg. In Mar/Apr, 4 lifts, 2 above avg. In Dec>Feb, 4 big groups were all positive. In Mar/Apr, there were only 2. Relevant Retail has now been all positive in 23 of 25 months.  YOY inflation is growing, but still relatively low. However, cumulative & impending lifts can also affect sales. Progress is slow.

Here’s a more detailed look at April by Key Channels in the Stacked Bar Graph Format

Relevant Retail: Ytd Growth: +5.0%; Avg 19>26: +6.4%; Real: 3.7%. % Real Growth: 52.7%. Only 2 were up from Mar. Vs Apr 25: 9 were up, 6 Real. Vs Apr 21: 8 were up; 6 Real. Vs 19: Dept Stores were down & “real” Furniture Stores.

  • All Department Stores – This group was struggling before the pandemic hit them hard. They began recovery in March 21. Sales are +0.4% from Mar, but all YOY measurements, actual and real are negative. Their -0.8% Apr YOY drop is much better than their -4.4% avg. Ytd Growth: -3.3%; Avg 19>26: -5.2%; Real: -6.8%. % Real growth: None
  • Club/SuprCtr/$- They fueled a big part of the recovery because they focus on value which has broad consumer appeal. $ales are -2.5% from Mar, but they are up in all comparisons but real vs Apr 25. Their 2.3% YOY Apr lift is -71% below their 92>25 avg of +8.2%. Ytd Growth: 2.7%; Avg 19>26: +4.8%; Real: 2.1%. % Real Growth: 40.9%
  • Grocery- They depend on frequent purchases, so their changes are usually less radical. $ales are -0.5% from Mar. They are actually up for all but really down for all but vs 2019. Cumulative inflation has hit them hard. Their +1.0% YOY Apr lift is 69% below their +3.1% avg. Ytd Growth: 0.7%; Avg 19>26: +4.3%; Real: 0.2%. % Real Growth: 5.0%
  • Health/Drug Stores – Many stores are essential, but consumers visit less frequently than Grocery stores. $ are -2.9% from Mar, but positive in all YOY comparisons. Inflation has been relatively low, so it is surprising that their +1.8% YOY lift vs Apr 25 is 65.1% below avg. Ytd Growth: 2.2%; Avg 19>26: +4.5%; Real: 3.1%. % Real Growth: 67.4%
  • Clothing and Accessories – Clothes mattered less if you stayed home. That changed in March 2021 with strong growth through 2022. Sales are -3.7% from Mar, but positive in all YOY measurements. $ales are +4.0% vs Apr 25, 32.1% more than their 3.1% avg. Ytd Growth: 6.3%; Avg 19>26: +3.5%; Real: 2.3%. % Real Growth: 61.4%.
  • Home Furnishings – In mid-2020 consumers’ focus turned to their homes and furniture became a priority. Inflation is down to 2.8% in Apr. $ are -5.8% from Mar and they are only actually up vs 2019. All real sales are down. YOY vs Apr 25, they are -3.4%, far below their 3.2% avg lift. Ytd Growth: -3.0%; Avg 19>26:+2.2%; Real: -0.2%. % Real Growth: None.
  • Electronic/Appliances – They have had many issues. $ fell in Apr>May of 2020 and didn’t reach 2019 levels until March 21. $ are -3.0% from Mar, but they are up in all comparisons. Strong deflation made real sales very high. Sales are +9.1% vs Apr 25, 4.3 times above the 2.1% avg. Ytd Growth: 6.3%; Avg 19>26: 1.1%; Real: 4.4%. % Real Growth: 100+%
  • Bldg Matl, Farm, Garden, Hdwe – They benefited from the consumers’ focus on home. In 22 the lift slowed as inflation grew to double digits. Prices rose again in Apr>Sep 25, dropped Oct/Nov, rose Dec/Jan to 5.6%, fell Feb to 4.8%, rose Mar to 6.0%, fell Apr to 5.0%. Sales are +10.2% from Mar and are only actually down vs Apr 21 & really up vs 2019. $ vs Apr 25 were +3.0%, 29% below their 4.2% Avg. Ytd Growth: 3.7%; Avg 19>26: 4.5%; Real: 0.8%. % Real Growth: 15.1%
  • Sporting Goods, Hobby and Book Stores – Consumers turned their attention to recreation and Sporting Goods stores sales took off. Book & Hobby Stores recovered more slowly. They have been on a sales roller coaster since June 24 and $ are -2.7% from Mar. All YOY comparisons, but real vs Apr 21 are positive. YOY Sales vs Apr 25 are +12.5%, 4.3 times more than their 2.9% avg. Ytd Growth: +9.2%; Avg 19>26: +4.6%; Real: 3.8%. % Real Growth: 79.2%.
  • All Miscellaneous Stores – Pet Stores have been a key part of the strong and growing recovery of this group. They finished 2020 at +0.9% but sales took off in March 21 and have continued to grow. Sales are -0.9% vs Mar, but positive in all comparisons. They are 2nd in the % increase vs 19 & vs 21. Plus, their 11.3% YOY Apr lift is 2.6 times more than their 92>25 avg of +4.3%. Ytd Growth: +11.6%; Avg 19>26: +8.1%; Real: 6.3%. % Real Growth: 72.7%.
  • NonStore Retailers – 90% of their $ comes from Internet/Mail Order/TV. The pandemic accelerated online spending. They ended 2020 +21.4%. The growth continued in 2021 as sales exceeded $100B for the 1st time and they broke the $1 Trillion barrier. $ are -1.5% from Mar, but their YOY lift of 10.8% is 7.1% above the 10.1% avg. Plus, they are positive in all comparisons. Ytd Growth: 10.3%; Avg 19>26: +13.2%; Real: 11.3%. % Real Growth: 80.2%.

Recap – Driven by Relevant Retail, the Pandemic recovery was widespread by Y/E 21. In 22 we were hit with the strongest inflation in 40 years. Inflation has slowed considerably from its Jun 22 peak, but only 2 smaller channels are now deflating. Deflation helps, but cumulative inflation can still have a negative impact – slowed YOY growth and even sales drops. As expected, $ fell from Mar for 9 small channels. 6 of the 9 drops were smaller than avg – Good! The biggest concern is still YOY drops and smaller lifts. Relevant Retail’s 5.0% lift vs Apr 25 was 7.3% above avg. 9 channels had a YOY lift vs last year, 1 less than Mar. 5 of the 9 lifts were above avg, 2 less than Mar. There are multiple factors slowing growth, but the major one is high prices from current & cumulative inflation. Feb is usually the worst retail month. April is the 3rd worst & the Mar>Apr drop is the 4th biggest. Both Total & Relevant Retail had record monthly sales for Dec>Apr 26. The Apr Yoy lift was -1.7% below avg for Total but 7.3% above for Relevant. The situation is definitely worse than Mar as 6 of 11 channels (only 4 in Mar) had a below avg lift or a drop vs 25. We’ll see what happens in May.

Here are the Mar/Apr inflation rates for the CPIs used to calculate the impact of inflation on retail groups and channels. This includes special aggregate CPIs created with the instruction and guidance of the US BLS. I also researched data from the last Economic Census to review the share of sales by product category for the various channels to help in selecting what expenditures to include in specific aggregates. Of course, none of these specially created aggregates are 100% accurate but they are much closer than the overall CPI or available aggregates. The data includes the CPI changes vs 21 to show cumulative inflation.

  • Monthly YOY CPI changes of 0.2% or more are highlighted. (Green = lower; Pink = higher)Here are some answers to some obvious questions. Note: Gasoline & Groceries are big drivers in the National CPI lift.
  1. Why is the group for Nonstore different from the Internet?
    • Non-store is not all internet. It also includes Fuel Oil Dealers, the non-motor fuel Energy Commodity.
  2. Why is there no Food at home included in Nonstore or Internet?
    • Online Grocery purchasing is becoming popular, but almost all is from companies whose major business is brick ‘n mortar. These online sales are recorded under their primary channel
  3. 5 Channels have the same CPI aggregate but represent a variety of business types.
    • They also have a wide range of product types. Rather than try to build aggregates of a multitude of small expenditure categories, it seemed better to eliminate the biggest, influential groups that they don’t sell. This method is not perfect, but it is certainly closer than any existing aggregate.
  4. Why are Grocery and Supermarkets only tied to the Grocery CPI?
    • According to the Economic Census, 76% of their sales comes from Grocery products. Grocery Products are the driver. The balance of their sales comes from a collection of a multitude of categories.
  5. What about Drug/Health Stores only being tied to Medical Commodities.
    • An answer similar to the one for Grocery/Supermarkets. However, in this case Medical Commodities account for over 80% of these stores’ total sales.
  6. Why do SuperCtrs/Clubs and $ Stores have the same CPI?
    • While the Big Stores sell much more fresh groceries, Groceries account for ¼ of $ Store sales. Both Channels generally offer most of the same product categories, but the actual product mix is different.

Petflation 2026 – April Update: Pet Prices Still at or Near Record Highs

/in /by

It’s time to continue with 2026 Inflation. The Consumer Price Index peaked back in June 2022 at 9.1% then began to slow until it turned up in Jul/Aug 2023. Prices fell in Oct>Dec 23, then turned up Jan>Oct 24 but fell in Nov. However, they rose 10 straight months to a record high in Sep 25, fell Oct>Dec, rose in Jan>Apr (Record). The CPI vs last year rose to 3.8% from 3.3%. Grocery prices increased 0.7% from Mar and their YOY inflation grew to 2.9% from 1.9%. BTW, Gas prices are up 38.7% from Feb. Even minor price changes can affect consumer pet spending, especially in the discretionary pet segments, so we will continue to publish monthly reports to track petflation as it evolves in the market.

Petflation was +4.1% in Dec 21 while the overall CPI was +7.0%. The gap narrowed as Petflation accelerated. It was 96.7% of the national rate in June 22. National inflation has slowed considerably, but Petflation generally increased until June 23. It passed the CPI in July 22, fell below it from Apr>Jul 24. It passed the CPI in Aug, fell below in Sep>Oct, rose above in Nov, fell below in Dec>Aug 25, passed it in Sep>Oct & Dec>Mar 26, now it’s equal in Apr. All reports will include:

  • A rolling 24 month tracking of the CPI for all pet segments and the national CPI. The base number will be pre-pandemic December 2019 in this and future reports, which will facilitate comparisons.
  • Monthly comparisons of 26 vs 25 which will include Pet Segments and relevant Human spending categories. Plus
    1. CPI change from the previous month.
    2. Inflation changes for recent years (25>26, 24>25, 23>24, 22>23, 21>22, 20>21, 19>20, 18>19)
    3. Total Inflation for the current month in 2026 vs 2019 and vs 2021 to see the full inflation surge.
    4. Average annual Year Over Year inflation rate from 2019 to 2026
  • YTD comparisons
    1. YTD numbers for the monthly comparisons #2>4 above

In our first graph we will track the monthly change in prices for the 24 months from Apr 24 to Apr 26. We will use December 2019 as a base number so we can track the progress from pre-pandemic times through an eventual recovery. This chart is designed to give you a visual image of the flow of pricing. You can see the similarities and differences in segment patterns and compare them to the overall U.S. CPI. The year-end numbers & those from 12 and 24 months earlier are included. We also included and highlighted (pink) the cumulative price peak for each segment. In Apr, Total Pet prices were down -0.1% from Mar. The Service segments were up 0.01%, while Products fell -0.2%.

In Mar 24, the CPI was +22.0% and Pet was +23.7%. The Services segments inflatedDec after mid-20, while Product inflation stayed low until late 21. In 22, Food prices grew but the others had mixed patterns until July 22, when all rose. In Aug>Oct Petflation took off. In Nov>Dec, Services & Food inflated while Vet & Supplies prices stabilized. In Jan>Apr 23, prices grew every month for all segments except for 1 Supplies dip. In May Products prices grew while Services slowed. In Jun/Jul this reversed. In Aug all but Services fell. In Sep/Oct this flipped. In Nov, all but Food & Vet fell. In Dec, Supp. & Vet  drove prices up. In Jan>Mar 24 Pet prices grew. In April, prices in all but Vet fell. In May, all but Food grew. In June, Products drove a lift. In July, all but Services fell. In Aug, Food drove a drop. In Sep, Products fueled a drop. In Nov all were up. Prices dropped in Mar & Oct>Nov 25, rose Dec>Mar 26, fell Apr. All segments set records in Mar and/or Apr 26.

  • U.S. CPI – Inflation was below 2% through 2020. It turned up in January 21 and grew until flattening out in Jul>Dec 22. Prices rose Jan>Sep 23, fell Oct>Dec, rose Jan>Oct 24, fell Nov, rose Dec>Sep 25, fell Nov>, but hit record highs in Jan>Apr 26. 23% of the lift since Dec 19 happened from Jan>Jun 22 – 8% of the time.
  • Pet Food – Prices were at the Dec 19 level Apr 20> Sep /21. They grew & peaked May 23, then got on a roller which continues Jun/Jul 25↑, Aug↓, Sep↔, Oct/Nov ↓, Dec>Mar↑, Apr↓. Over 90% of the lift was in 22/23.
  • Pet Supplies – Supplies prices were high in Dec 19 due to tariffs. They had a deflated roller coaster ride until mid-21 when they returned to Dec 19 prices & stayed there until 22. They turned up in Jan (record). They plateaued Feb>May, grew in June, flattened in July, then turned up in Aug>Oct to a new record. Prices stabilized Nov>Dec, grew Jan>Feb 23. fell in Mar, but the roller coaster hasn’t stopped. Jan>Feb 25↓, Mar>May↑, Jun↓, Jul↑, Aug↓, Sep↑, Oct>Nov↓, Dec↑(record), Jan 26↓, Feb>Mar↑ (record), Apr↓. Prices are only 0.3% below the Mar record
  • Pet Services– Inflation is usually 2+%. Perhaps due to closures, prices increased at a lower rate in 2020. In 2021 consumer demand increased but with fewer outlets. Inflation grew in 21 with the biggest lift in Jan>Apr. Inflation was strong in 22 but prices got on a roller coaster. They turned up Jul>Apr 23, fell May. Jun>Aug↑, Sep>Dec↓, Jan>Mar 24↑, Apr↓, May↑, Jun↓, Jul>Nov↑, Dec>Mar 25↓, Apr>Aug↑, Sep↓, Oct>Apr 26↑(record).
  • Veterinary – Inflation has been consistent. Prices turned up in Mar 20 and grew through 21. A surge began in Dec 21 which put them above the overall CPI. In May/Jun 22 prices fell below the CPI. However, they rose again & have been above the CPI since July 22. In 23>25 prices grew Jan>May, leveled Jun/Jul, fell Aug, grew Sep>Dec, fell Jan, grew Feb>May, fell Jun>Jul, grew Aug 24>Sep 25, fell Oct>Nov, grew Dec>Apr 26. (records)
  • Total Pet – Petflation is a sum of the segments. In Dec 21 the price surge began. In Mar>Jun 22 the segments had ups & downs, but Petflation grew Jul>Nov, slowed Dec, grew Jan>May 23, fell Jun>Aug, grew Sep/Oct, then fell in Nov. Prices grew Dec>Mar 24 to a record high. Prices fell in April, rose May>Jun, fell Jul>Sep, rose Oct>Nov, fell Dec, rose Jan>Feb 25, fell Mar, grew Apr>Jul, fell Aug, rose Sep, fell Oct>Nov, rose Dec>Mar (record), then fell in Apr.

Next, we’ll turn our attention to the Year Over Year inflation rate change for April and compare it to last month, last year and to previous years. We will also show total inflation from 21>26 & 19>26. Petflation rose from 2.5% to 3.5% in Sep, fell to 2.6% in Nov, rose to 3.5% in Dec & 4.3% in Mar. In Apr it is down to 3.8%, equal to the National CPI. The chart will allow you to compare the inflation rates of 25>26 to 24>25 and other years but also see how much of the total inflation since 2019 came from the current surge. We’ve included some human categories to put the pet numbers into perspective.

Overall, prices were up 0.9% from Mar and were +3.8% vs Apr 25, up from 3.3% last month. Grocery prices rose 0.7% and inflation grew to +2.9% from 1.9%. There were 5 price drops from last month, up from 2 in Mar. In Feb, there were no drops. In Dec & Jan there was 1. In Nov there were 6 drops. The national YOY monthly CPI rate of 3.8% is up 65.2% from 24>25 but it’s 54% less than 21>22. The 25>26 rate is above 24>25 for all but Pet Supplies & Haircuts. In our 2021>2025 measurement you also can see that over 80% of the cumulative inflation since 2019 has occurred in all but 5 segments, Haircuts, Medical, Vet, Pet Services, Groceries. Service Segments have generally had higher inflation rates so there was a smaller pricing lift in the recent strong increase. Pet Products have a very different pattern. The 21>26 inflation surge provided 98% of their overall inflation since 2019. This happened because Pet Products prices in 2021 were still recovering from a deflationary period. Services expenditures account for 63.6% of the National CPI so they are very influential. Their current CPI is +3.8% while the CPI for Commodities jumped up from 3.4% to 4.6%. Services are the usual inflation driver, but Commodities are behind the current increase. The situation in Pet is closer to the “normal” national situation. Petflation: 3.8%. The CPI for the 2 Service Segments is 5.2%. The Pet Products CPI is 2.6%.

  • U.S. CPI– Prices are +0.9% from Feb. The YOY increase is 3.8%, up from 3.3% in Mar. It peaked at +9.1% back in June 2022. The targeted inflation rate is <2% so we are now 90+% higher than the target. The Mar/Apr lifts follow Feb stability, a lift in Jan, stability in Dec and 2 drops in Oct & Nov. The current rate is 65.2% above 24>25 and the 21>26 rate is +24.7%, 81.5% of the total inflation since 2019. The Inflation surge was growing in April 2021, +4.2%
  • Pet Food– Prices are -0.2% vs Mar, but +2.2% vs Apr 25, down from 2.3%. They are now 24% below the Food at Home inflation rate of +2.9%. Remember that the YOY Pet Food CPI has deflated in 15 of the last 26 months. The 2021>2026 inflation surge has generated 94.6% of the 25.9% inflation since 2019. Inflation began for Pet Food in June 2021, +0.9%, after 12 straight deflationary months. Pet Food prices are still within 0.2% of the Mar record high.
  • Food at Home – Prices are +0.7% from Mar and the YOY CPI rose from 1.9% to 2.9%. This is still radically lower than Jul>Sep 2022 when it exceeded 13%. The 32.7% Inflation for this category since 2019 is 8% more than the national CPI but is only in 5th place behind 3 Services expenditures and Total Pet. 79.2% of the inflation since 2019 occurred from 2021>26. This is slightly less than the CPI, but we should note that Grocery prices began inflating in 2020>21 then the rate accelerated. It appears that the pandemic supply chain issues in Food which contributed to higher prices started early and foreshadowed problems in other categories and the overall CPI tsunami.
  • Pets & Supplies– Prices were -0.3% from Mar and YOY inflation slowed to 1.9% from 3.5%. They still have the lowest rate vs 2019. Prices were deflated for much of 20>21. As a result, the 2021>26 inflation surge accounted for 107.5% of the total price increase since 2019. Prices set a record in Oct 22 then deflated. 3 lifts pushed them to a record high in Feb 23. Prices fell in Mar & the roller coaster continued into 25. They fell Jan/Feb 25, rose Mar>May, fell Jun, rose Jul, fell Aug, rose Sep, fell Oct>Nov, rose Dec (record), fell in Jan, rose Feb>Mar – a new record, then fell in Apr.
  • Veterinary Services– Prices are +0.2% from Mar and +5.5% from 2025, down from 5.6%. They are #2 in inflation vs last year, behind Pet Serv. but still #1 in the increase since 2019, +55.4% and 21, +43.9%. For Veterinary, high annual inflation is the norm. However, the rate has increased during the current surge, especially since 23. They have the highest Apr avg rate in 26, but only 79% of the cumulative inflation since 2019 occurred from 2021>26.
  • Medical Services – Prices turned sharply up at the start of the pandemic but then inflation slowed and fell to a low rate in 20>21. Prices fell -0.1% from Mar and inflation vs last year slowed to +3.2% from +3.7%. Medical Services are not a big part of the current surge as only 59.5% of the 22.7%, 2019>26 increase happened from 21>26.
  • Pet Services – Inflation slowed in 20 but grew in 21. In 24 prices surged in Jul>Nov, then fell to 3.9% in Dec>Mar 25. Apr grew, May fell, June rose, Jul rose to 6.3%. Inflation fell to 5.8% in Aug & to 4.2% in Nov. In Dec>Mar 26 it rose to 7.8%, then fell to 6.6% in Apr. They are #1 vs 25 and #2 vs 21 & 19. 79.8% of their 19>25 inflation is from 21>26.
  • Haircuts/Other Personal Services – Prices are -0.7% from Mar but +3.6% from Apr 25. 20 of the last 28 months have been 4.0+%. Inflation has been pretty consistent. 67.3% of the 19>26 inflation happened 21>26.
  • Total Pet– Petflation slowed to 3.8% from 4.3%. Only Veterinary & Pet Services had a higher rate. It is double the 24>25 rate but equal to the current U.S. CPI. Plus, it is 22.6% above the 3.1% average Apr rate since 1997. Apr prices fell -0.1%, driven by Products. The Mar>Apr decrease was very different from the 0.4% 97>25 average change and unexpected. Since 1997, there have been only 3 Mar>Apr price drops. A big factor in the current CPI drop was that prices rose 0.4% in Mar>Apr 25. The recovery is definitely slow. Now, we’ll look at YTD data.

The 25>26 rate is higher than 24>25 for all, but Veterinary. The 22>23 inflation rate was the highest for Tot Pet, Pet Food, Veterinary & Pet Services. 21>22 has the highest rate for Groceries, Pet Supplies & the Natl CPI. 20>21: Haircuts; 19>20: Medical Services. The average national inflation rate in the 7 years since 2019 is 3.8%. Only 3 of the categories are below that rate – Medical Services (3.0%), Pet Supplies (1.9%) and Pet Food (3.4%). It is no surprise that Veterinary Services has the highest average rate (6.5%), but all 4 other categories are +4.0% or higher.

  • U.S. CPI – The 25>26 rate is 3.0%, up 15% from 24>25 but down 9% from 23>24. It is also 62.5% less than 21>22 and 21% below the average increase from 2019>2026. However, it’s still 52% more than the average increase from 2018>21. 83% of the 29.7% inflation since 2019 occurred from 2021>26. Inflation is a problem that started recently.
  • Pet Food – Ytd prices are still inflating, 1.8%, up from 1.7%. That’s a big increase from -0.5% in 24>25, but it is still below 2.2% in 23>24 and even the 1.9% 18>20 average. Pet Food has the highest 22>23 rate but is only #6 in the 21>26 rates and #8 in 19>26. Deflation in the 1st half of 2021 kept YTD prices low then they surged in 22 and especially in 23. 93% of the inflation since 2019 occurred from 2021>26.
  • Food at Home – The 25>26 inflation rate is 9.5% above 24>25, but it is down 75% from 22>23 and 21>22. It’s even 21% less than 20>21. However, it is 70.4% higher than the average rate from 2018>20. It is only in 5th place for the highest inflation since 2019 but still beat the U.S. CPI by 7.1%. You can see the impact of supply chain issues on the Grocery category as 82% of the inflation since 2019 occurred from 2021>26.
  • Pets & Pet Supplies – A roller coaster, prices rose Jan>Feb 24, fell Mar>Apr, rose May>Jun, fell July, rose Aug, fell Sep>Oct, rose Nov>Dec, fell Jan>Feb 25, then rose Mar>May. Prices vs 24 deflated in June, back to +0.7% in July, fell to 0.0% in Aug, rose Sep>Dec, fell Jan 26, rose Feb>Mar, fell Apr. Supplies still have the lowest inflation since 2019. Their biggest YOY lifts since 2019 were in 22 & 23. The 2021 deflation created an unusual situation. Prices are up 14.0% from 2019 but 111% of this lift happened from 21>25. Prices are up 15.6% from their 2021 “bottom”.
  • Veterinary Services – Inflation was high in 2019 and steadily grew until it took off in late 2022. The rate may have peaked in 2023, but it is still going strong in 2026, +5.9%, the 2nd  highest on the chart. However, they are still #1 in inflation since 2019 and since 2021. At +6.5%, they have the highest average inflation rate since 2019. It is 71% higher than the National Average but 2.2 times higher than the Inflation average for Medical Services. Strong Inflation is the norm in Veterinary Services.
  • Medical Services – Prices went up significantly at the beginning of the pandemic, but inflation slowed in 2021. In Apr 2026 it is 3.7%, 23% above the 3.0% 2019>26 average rate. We should also note that 3.7% is 2.3 times higher than the 1.6% low point in 23>24.
  • Pet Services – After falling in late 2023, prices surged in 2024, then fell in 2025 until an Apr>Aug lift followed by a Sep>Nov dip and a Dec>Apr 26 lift. The 25>26 6.8% CPI is #1 on the chart, passing Veterinary. It is 33% above their 19>26 avg and more than double their 2018>20 avg. Pet Services is also 2nd in both 19>26 and 21>26 inflation.
  • Haircuts & Personal Services – The services segments, essential & non-essential, were hit hardest by the pandemic. The industry responded by raising prices. 2026 inflation is 4.5%, 22.4% below its 20/21 peak, but 40.6% above the 18>20 average. Consumers are paying over 35% more than in 2019, which usually reduces the purchase frequency.
  • Total Pet – Petflation is 3.7%, up 95% from 24>25, but 64.1% less than their 22>23 peak. However, It’s 61% more than their 18>21 avg and 23% above the CPI. Petflation is still growing. Except for Mar/Aug/Oct/Nov, Pet prices rose in 25, which continued in Jan>Mar 26, then paused in Apr. The overall gain is primarily being driven by a flip from deflation to inflation in Pet Products and continued strong inflation in Services, especially Non-Vet.

The Petflation recovery paused in Aug 24, came back Sep>Oct, paused in Nov, resumed in Dec>Jan 25, paused in Feb, restarted in Mar and paused Apr>Sep. It improved Oct/Nov but paused in Dec>Apr 26. We tend to focus on the monthly, YOY inflation in the current year and ignore the fact that inflation is cumulative. Pet prices are 28.2% above 2021 and 33.3% higher than 2019. Those are big lifts. In fact, Mar prices for the National CPI, Total Pet and all pet segments reached new record highs. In Apr, prices either set a new record or are within 0.3% of Mar. Only Supplies prices (+14.7%) are less than 25.9% higher than 2019. Since price/value is the biggest driver in consumer spending, inflation will affect the Pet Industry. Services will be the least impacted as it is the most driven by high income CUs. Veterinary will continue to see a reduction in visit frequency. Pet Parents will just pay more. The product segments will see a more complex reaction. Supplies are more discretionary so we will likely see a reduction in purchase frequency. In Pet Food, the most needed segment, some Pet Parents may choose to downgrade their Pet Food. However, the biggest impact in both product segments will be a strong movement to online purchasing and private label. We saw proof of this at both GPE 25 & SZ 25 as a huge # of exhibitors offer OEM services. At GPE 26, this trend continued. Strong, cumulative inflation has a widespread impact. We’ll continue to monitor the situation.

2024 Pet Services Spending was $13.65B – Where did it come from…?

/in /by

Next, Pet Services. It is by far the smallest Segment, but like Supplies & Veterinary, it had a record increase in 2021. However, unlike them, there was no $ drop in 2022. The lift grew stronger, up $3.26 (+35.8%). After the great recession, Services’ annual spending slowly but steadily increased. During this time, the number of Services outlets grew as brick ‘n mortar retailers looked for a way to combat the growing influence of online outlets. After all, you can buy products, but you can’t get your dog groomed on the Internet. This created a highly price competitive market for Pet Services. In 2017 there was a slight increase in visit frequency, but Pet Parents just paid less. This resulted in a 1.0% decrease in Services spending. In 2018 consumer behavior changed as a significant number decided to take advantage of the increased availability and convenience of Pet Services and spending literally took off, +$1.95B (+28.9%), the biggest increase in history. In 2019 Pet Parents, especially the younger ones, value shopped, and spending turned down $0.10B. In the 2020 pandemic Services outlets were often deemed nonessential and were subject to restrictions and closures which drove a huge drop in $. In 2021 things opened up and Services spending rebounded with 2 consecutive record lifts in 2021 & 2022. In 2023, the growth continued but it slowed, +$1.05B (+8.5%). It slowed even more in 2024, +$0.23B, +1.7%.

Services spending is the most discretionary, but its reach is expanding. Let’s look deeper into the demographics.

Let’s start by identifying the groups most responsible for the bulk of Services spending in 2024 and the $0.23B increase. The first chart details the biggest Pet Services spenders for each of 10 demographic categories. It shows their share of CU’s, share of Services spending and their spending performance (Share of spending/share of CU’s). In order to better target the bulk of the spending we altered 2 groups – income & housing. In 2023 4 were changed. The performance level should also be noted as 8 of 10 groups have a performance level above 120%. This is 1 more than 2023, but 2 more than Supplies, 3 more than Pet Food and even 1 more than Veterinary and Total Pet. The increase from 2023 indicates that Pet Services spending was likely less balanced in 2024. It again has the biggest disparity between the best and worst performing segments. Income is still the biggest factor in Services Spending. The categories are presented in the order that reflects their share of Total Pet $ which highlights the differences of the 8 matching groups. The biggest share ranking differences from Total Pet is that Education has a bigger share in Services.

  1. Housing – Homeowners w/Mtge (62.8%) up from 61.3%. Homeownership is a big factor in spending in all industry segments. This special group was created because those w/Mtge reached the 60% target in 2023. Their performance grew from 162.6% to 170.2% and they stayed #2 in importance. Homeowners without a mortgage  (-$0.10B) and Renters (-$0.01B) spent less.
  2. Race/Ethnic – White, not Hispanic (80.7%) down from 84.2%. This group accounts for most of the spending in all segments. Their performance fell from 126.9% to 122.1% and they dropped from 5th to 8th place in importance. Only Whites spent less. African Americans, +$0.27B & Hispanics, +$0.20B led the way.
  3. Area – Urban Areas (80.8%) up from 79.2% in share, and performance grew from 97.8% to 100.0%. They finally earned their share of $pending. Services is an Urban Segment. They are the only Pet segment with 100% performance. Only the Suburbs spent more, +$1.48B, but Center City was only -$0.05B.
  4. Income – $100K> (71.3%) up from 70.7% This group’s performance rating is 187.9%, down from 194.1%. Income is still by far the most important factor in increased Pet Services Spending. Only the $70>99K and $150>199K income groups spent more. At +$0.82B, $150K>199K had the biggest increase. The biggest decrease was -$0.34B by the $100>149K group. The performance decrease was due to a 2.5M increase in $100K> CUs while <$100K fell 1.3M.
  5. # in CU – 2>4 people (74.3%) up from 71.3% Their performance also increased from 119.2% to 123.4% and CU Size moved up to #6 from #8 in importance. Only 2 & 4 people CUs spent more. The biggest drop was -$0.37B by 3 people CUs. 4 People CUs were +$0.69B, which drove the share/performance lifts and put them in the 120% club.
  6. Occupation– All Wage & Salary (69.3%) up from 66.2% and their performance rating rose from 108.7% to 112.2%. They stayed #9 in importance. Only Mgrs/Prof and Retirees spent more. Managers & Professionals had the biggest $ increase, +$1.04B, +18.1%. The biggest drop was Self-employed, -$0.36B, -26.3%. These 2 spending patterns were critical in the lifts in share/performance. The Mgrs/Prof lift pushed the Total Wage & Salary Group up to +$0.58B while the Self-employed drop drove the other segments total down to -$0.35B. Hence…the changes
  7. Education – College Grads (76.9%) up from 72.7%. Income generally increases with education so Services spending grows with increasing education. Performance grew from 152.0% to 159.9% but Education stayed #3 in importance. Only HS Grads (only) & College Grads spent more. College: +$0.75B; <College: -$0.52B.
  8. CU Composition – Married Couples (69.1%) up from 67.8%. Married couples are a big share of $ and have 100+% performance in all segments. Their performance increased to 144.0% from 140.7% but they stayed #4 in importance in Services spending. Only Singles, Married, Child <6 and Married, Plus Adults spent less. All Married were +$0.33B, while Unmarried were -$0.10. This caused the changes.
  9. # Earners – 2+ CUs, 1 or 2 Earners (65.4%) up from (61.1%) All adults in the CU don’t necessarily work. Income is important but is slightly below avg for the 1 Earner segment. Their performance rose to 130.5% from 121.7% and # of Earners moved up from #7 to #4 in importance. Only the segments in this big group & No Earner, Singles spent more. The big group was +$0.72B which caused the share/performance lifts.
  10. Age – 35>64 (66.7%) up from 64.8%. Their performance grew from 124.0% to 128.8%. Age stayed #6 in importance. Only 25>34, 45>54 & 75> spent more. The 45>54 group was +$0.83B, +30.1%. This big lift made up for the -$0.43B drop by other members of this big group and drove the lift in share & performance.

We changed 2 of the groups for Services – Income & Housing to better target the biggest spenders. We should also note that Income is still more important to spending in Services than in any other segment. In the Big Groups, only Race/Ethnic fell in both share and performance. Also, Services now has 8 groups performing at 120+%, up from 7 in 2023 and 6 in 2022. Overall, in 2024 Services spending became less demographically balanced.

Now, we’ll look at 2024’s best and worst performing Pet Services spending segments in each category.

The best & worst performers are not surprising. There are 3 that are different from 2023, 2 Best & 1 Worst, 1 less than last year. CU Comp & Size reinforce the move towards “family” CUs. Income is a big factor for almost all categories. Gen X is still on top, but spending shifted away from 55>64, their oldest members, to 45>54. The average difference between Best & Worst is 119.5%, the highest of any segment and up from 111.8% in 2023. Pet Services spending became a little less balanced in 2024. Changes from 2023  are “boxed”. We should note:

  • Income is most important in Services. 276.2%, down from 314.7%, but still the highest by any group in any segment.
  • # Earners – 2 Earners stayed on top and No Earner, Singles stayed on the bottom.
  • Age – 45>54 is all Gen X. They have the highest income. 35>64 have the 3 highest incomes & performed at 100+%.
  • Area – Suburbs replaced Rural on top and Center City performance is now up to 95.4%.
  • Region – In 2023, 3 were 100+%. In 2024, only 2 – West & Midwest. Northeast replaced South on the bottom.
  • CU Composition – Married, Oldest child 6>17, are again on top while Single Parents remain firmly at the bottom.
  • CU Size – The key is having 2+ people in the CU. Only 4 & 2 People perform above 100%. However, 3 & 5+ People are close. Both are 94.1% or higher. 1 Person CUs Services’ performance is 55.0%.
  • Generation – Gen X retained the Top Spot and Gen Z stayed at the bottom. Millennials earned their share with 100+% performance, but not Boomers, 80.5%. Born <1946 was next to last with 57.2%.

In Pet Services spending performance, income is still the major factor. Spending began skewing younger in 2018. They slipped a little in 2019, but basically held their ground during the pandemic. In 2021, Boomers, Millennials and younger Gen Xers got on board. In 2022 & 2023, spending skewed towards older Gen Xers. In 2024, it was the Gen X core, 45>54.

It’s time to “Show you the money”. Here are segments with the biggest $ changes in Pet Services Spending.

In this chart you immediately see the difference from last year. In 2024 you see a little less stability. There were 4 repeats. In 2023 there were 7. Also, 3 segments flipped from 1st to last or vice versa. In 2023 there were 2 flips. 2021 & 2022 had record increases, but the lift in 2023 was only $1.05B, and fell to +$0.23B, +1.7% in 2024. Plus, there were no categories where all segments spent more. compared to 2 in 2023. Also, 48% of 96 demographic segments spent more, down from 75% in 2023. Another thing is definitely worse. The biggest drop was -$0.90B. In 2023, it was only -$0.58B.

Here are the specifics:

  • Occupation – Both winner and loser are new.
    • Winner–– Mgrs & Professionals – Pet Services Spending: $6.79B; Up $1.04B (+18.1%)                 2023: Retired
    • Loser – Self-employed – Pet Services Spending: $1.00B; Down $0.36B (-26.3%)                             2023: Tech/Sls/Clerical
    • Comment – Retirees also spent a little more, +$0.03B. All others spent less.
  • Region – The 2023 Winner & Loser both flipped.
    • Winner – South – Pet Services Spending: $4.77B; Up $0.89B (+23.0%)                                       2023: Northeast
    • Loser – Northeast – Pet Services Spending: $1.88B; Down $0.64B (-25.4%)                              2023: South
    • Comment – In 2021 & 2022, all spent more. In 2023 only the South spent less. In 2024, the West also spent less.
  • Age – Both winner and loser are new. No surprises.
    • Winner – 45>54 yrs – Pet Services Spending: $3.57B; Up $0.83B (+30.1%)                               2023: 55>64 yrs
    • Loser – 65>74 yrs – Pet Services Spending: $1.62B; Down $0.48B (-22.9%)                             2023: 25>34 yrs
    • Comment: In 2022 only the <25 group spent less. In 2023, 25>34 & 65>74 had drops. In 2024, only 25>34, 45>54 & 75> spent more. 45>54 took the lead but 35>64 is still pretty balanced between the 3 groups. They have the 3 highest incomes and account for 51.8% of CUs, but 66.7% of Pet Services spending.
  • Income – $150>199K won, no surprise. However, $100>149K was an unexpected loser.
    • Winner – $150>199K – Pet Services Spending: $2.55B; Up $0.82B (+47.2%)                               2023: $200K>
    • Loser – $100>149K – Pet Services Spending: $2.59B; Down $0.34B (-11.8%)                             2023: $70 to $99K
    • Comment – Only $70>99K & $150>199K spent more, but their lifts totaled +$1.32B, which more than made up for the -$1.09B drop by other segments. Note: In the big income groups, only $70K> & $100K> spent more.
  • # in CU – Both the Winner & Loser are new and don’t usually lead in change.
    • Winner – 4 People – Pet Services Spending: $2.69B; Up $0.69B (+34.3%)                                    2023: 5+ People
    • Loser – 3 People – Pet Services Spending: $1.91B; Down $0.37B (-16.1%)                                   2023: 1 Person
    • Comment: 2 People also spent +$0.26B more. The 2 & 4 People lifts pushed 2+ CUs up to +$0.46B.
  • Education – Both the Winner & Loser are again new. These 2 are not surprising.
    • Winner – Advanced Degree – Pet Services Spending: $5.95B; Up $0.67B (+12.6%)                              2023: BA/BS Degree
    • Loser – HS Grad w/some College – Services Spending: $1.15B; Down $0.55B (-32.2%)                      2023: Assoc. Degree 
    • Comment – All College Grads plus those who are only HS Grads are the only segments that spent more. Amazingly, HS Grads only had a +30.2% lift. College Grads were +0.75B; <College were -$0.52B.
  • # Earners– 2 Earners held their spot at the top while 1 Earner, Singles replaced No Earner, Singles at the bottom.
    • Winner – 2 Earners – Pet Services Spending: $6.81B; Up $0.66B (+10.7%)                                      2023: 2 Earners
    • Loser – 1 Earner, Single – Pet Services Spending: $1.64B; Down $0.24B (-12.9%)                         2023: No Earner, Single
    • Comment – Only 2 Earners, 1 Earner, 2+ CUs & No Earner, Singles spent more, but 2 of 3 were +$0.06B or less.
  • Area Type – Rural stayed on the bottom while Center City replaced the Suburbs at the top.
    • Winner – Center City – Pet Services Spending: $4.57B; Up $0.56B (+13.9%)                                2023: Suburbs 2500>
    • Loser – Rural – Pet Services Spending: $2.62B; Down $0.17B (-6.1%)                                           2023: Rural
    • Comment – In 2023, all segments spent more. In 2024 only Center City had a lift.
  • Generation – Gen X stayed on top and Boomers replaced Born <1946 at the bottom.
    • Winner – Gen X – Services: $5.29B; Up $0.51B (+10.7%)                                                   2023: Gen X
    • Loser – Boomers – Services: $3.36B; Down $0.90B (-21.1%)                                            2023: Born <1946
    • Comment – In 2022, all generations spent more. In 2023, only Born <1946 spent less. In 2024, only Boomers spent less. Millennials again finished in second place with a strong $0.47B, +13.0% increase.
  • Housing – Homeowners w/Mtge stayed on top, while those w/o Mtge replaced Renters on the bottom.
    • Winner – Homeowner w/Mtge – Services: $8.57B; Up $0.34B (+4.1%)                                  2023: Homeowner w/Mtge
    • Loser – Homeowner w/o Mtge – Services: $3.00B; Down $0.10B (-3.2%)                             2023: Renter
    • Comment – Only Homeowners w/Mtges spent more. The drop by Renters was only -$0.01B, -0.4%.
  • Race/Ethnic – White, Not Hispanic flipped to the bottom while African Americans replaced them on top.
    • Winner – African Americans – Services: $0.88B; Up $0.27B (+43.8%)                                    2023: White, Not Hispanic
    • Loser – White, Not Hispanic – Services: $11.02B; Down $0.27B (-2.4%)                                2023: Hispanic
    • Comment– Only Whites spent less. All minorities spent more, totaling +$0.51B, +23.9%.
  • CU Composition – Both Winner & Loser are new and not surprising.
    • Winner – Married, Child 18> – Services: $1.59B; Up $0.18B (+12.6%)                                       2023: Married, Couple Only
    • Loser – Singles – Services: $2.26B; Down $0.23B (-9.2%)                                                             2023: Unmarried, 2+ Adults
    • Comment – Only Singles, Married Child <6 & Married, +Adults, No Kids spent less. The increases were all $0.18B or less and the decreases, other than Singles, were -$0.11B or less.

We’ve seen the winners and losers in terms of change in Services Spending $ for 12 Demographic Categories. The growth slowed in 23 after 2 record lifts but was still widespread. In 24, the lift slowed even more and was far less widespread. Here’s some data which shows the evolution from 2019 to 2024. Services were hit hard by the pandemic but recovered stronger than ever with 2 record lifts. In 2024 the situation has become similar to pre-pandemic 2019 but with $5.03B more spending, a 41.6% increase. The avg 19>24 annual lift was +7.2%.

Total $:                2019: $8.62B     2020: $6.89B       2021: $9.10B       2022: $12.36B      2023: $13.42B      2024: $13.65B

% Segmts ↑$:     2019: 49%           2020: 21%          2021: 90%            2022: 93%             2023: 75%             2024: 47%

Avg Big ↑$:         2019: $0.25B      2020: $0.05B      2021: $1.10B        2022: $1.43B        2023: $0.73B        2024: $0.62B

Avg Big ↓$:         2019: -$0.27B    2020: -$0.89B     2021: $0.07B        2022: $0.16B        2023: -$0.16B       2024: -$0.39B 

We found the winners in performance and $, but there were others who performed well but didn’t win. They deserve…

Honorable Mention

Services is the most driven by high income. The performance of the lower-income segments in this group gives evidence that Service usage is still widespread. $70>99K was up 40% while HS Grads increased their spending by 30.1%. The 75+, 27% lift shows that Pet Parenting is a lifetime commitment. Whites spent less, but all Minorities spent more. The 2 lowest income groups had the biggest lifts – African Americans, +$0.27B; Hispanics, +$0.20B. Millennials aren’t low income or low profile. They are just preparing for their time at the top in Pet Spending. The Midwest has a slightly below avg income, but their Pet Services spending performance is 109.6%. Service prices are high, but they are a great benefit, so many are finding the $.

Summary

For years, Services’ spending slowly but steadily increased. However, the number of outlets offering Services was radically increasing. In 2017, this competitive pressure caused Pet Parents to shop for value and spending fell 1%. In 2018, the abundance of outlets and competitive prices finally had their intended impact. Many more consumers took advantage of the convenience of Pet Services and spending literally took off with a record increase. In 2019 Consumers held their ground, but we saw turmoil similar to 2017. Again, value shopping likely contributed to the small decrease.

In 2020, pandemic Services outlets were often deemed nonessential, so they were subject to restrictions and closures. Services are definitely needed by some groups. However, for most demographics, Services are a convenience, and spending is very discretionary in nature. The reduced availability and the pandemic driven focus on the “needed” segments – Food and Veterinary caused a 20% drop in Services $.

In 2021 the Retail Marketplace opened up again and many Pet Parents strongly returned to their previous Services mantra, “I need help with my Pet “children” and I have the money to pay for it!”. This behavior was widespread as 90% of all demographics spent more on Services, producing a record increase. In 2022 Services showed that it was different from other segments. All had record lifts related to the Pandemic followed by drops, except for Services. 2022 spending didn’t decrease, it grew even stronger, +$3.26B and more widespread as 93% of demographics increased spending. In 2023, growth continued, but slowed considerably, +$1.05B. It slowed even more in 2024, +$0.23B, +1.7%. The lifts were also becoming less widespread as 75% of CUs spent more in 2023. This fell to 48% in 2024. There was another definite negative. Services is the segment where spending is the most driven by income, so it has always had a big disparity between segments. This worsened in 2023 & 2024. Performance differences are a key measurement of disparity. Let’s consider the performance of the big groups. In 2024, there were 8 categories with a 120+% performing big group, up 1 from 2023 and the most of any segment. Services has 1 more than Veterinary (7), 2 more than Supplies (6) and 3 more than Food (5). There is an even better measure of the worsening. In 2024, the average difference between best & worst performers was 119.5%. In 2023 it was 111.8% and only 100.3% in 2022. Another key trend in 2024 was that 35>64 is still the dominant group, but spending is now skewing towards the midrange 45>54 yr olds. They have the highest income, so this makes sense.

Services were hit the hardest by the pandemic, but they had a record, widespread recovery in 2021>22. They are the segment most driven by high income so the high inflation in 2022>24 had less of an impact. It did affect the spending of some financially challenged groups, but in 2024, Services spending seems to have returned to a pattern similar to 2019.

At Last – The “Ultimate” Pet Services Spending Consumer Unit consists of 4 people – a married couple with children 6>17. They are 45>54 yr-old Gen Xers and White, but not of Hispanic origin. They both work and at least one of them has an Advanced College Degree and is a Manager or Professional. They have an income of over $200K. They live in a suburb with a population over 2500 in the Western U.S. and are still paying off their home mortgage.

Retail Channel $ Update – February Monthly & March Advance

/in /by

In March, YOY Commodities’ inflation jumped up to 3.4% from 1.2%. Even when inflation rates are low, high cumulative inflation vs 21 can still impact consumer spending and slow $ales growth.  We saw evidence of this in March. Total Retail $ were +4.5% vs 25, 6.4% below the average 92>25 lift. However, Relevant Retail was +6.0%, 27% above the March avg. The situation is definitely complex and there is still a long road to full recovery. We’ll continue to track the retail market with data from 2 reports provided by the Census Bureau and factor in a targeted CPI.

The Census Bureau Reports are the Monthly and the Advance Retail Sales Reports. Both are derived from sales data gathered from retailers across the U.S. and are published monthly at the same time. The Advance Report has a smaller sample size so it can be published quickly – normally, 2 weeks after month end. The Monthly Report includes data from all respondents, so it takes longer to compile the data – about 6 weeks. Although the sample size for the Advance report is smaller, the results over the years have proven it to be statistically accurate with the Monthly reports. The biggest difference is that the full sample in the Monthly report allows us to “drill” a little deeper into the retail channels.

We will begin with the February Monthly Report and then go to the March Advance Report. Our focus is comparing to last year but also 21 & 19. We’ll show both actual and the “real” change in sales as we factor inflation into the data.

Both reports include the following:

  • Total Retail, Restaurants, Auto, Gas Stations and Relevant Retail (removing Restaurants, Auto and Gas)
  • Individual Channel Data – This is more detailed in the Monthly reports, and we’ll focus on Pet Relevant Channels.

The data will be presented in detailed charts to facilitate visual comparison between groups/channels. The charts will show 11 separate measurements. To save space they will be displayed in a stacked bar format for the channel charts.

  • Current Month change – % & $ vs previous month
  • Current Month change – % & $ vs same month last year and vs 2021.
    • Current Month Real change vs last year and vs 2021 – % factoring in inflation
  • Current Ytd change – % & $ for this year vs last year, 2021 & 2019.
    • Current Ytd Real change % for this year vs last year and vs 2021 and 2019
  • Monthly & Ytd $ & CPIs for this year vs last year and vs 2021 which are targeted by channel will also be shown. (CPI Details are at the end of the report)

First, the February Monthly. All but Auto were down from January but there were only 2 actual sales drops – monthly/ytd vs 25 in Gas Stations. We should note: Gas Stations are still selling a little more product than in 2019. Also, Relevant Retail is all positive again. They’ve been all positive in 21 of the last 23 months. ($ are Not Seasonally Adjusted)

The February Monthly is $1.6B more than the Advance report. Restaurants: +$0.3B; Auto: -$0.2B; Gas Stations: +$0.1B; Relevant Retail: +$1.4B. Relevant Retail was the driver in the $ales drop vs January and only Auto was up. A Jan>Feb decrease in Total Retail  has happened in 65% of the years since 1992. However, the 2.9% drop was 4 times more than the 0.7% avg. There were 2 drops in actual sales – Monthly/Ytd vs 25 for Gas Stations. There were no “real” sales drops, the same as Dec/Jan. All but Gas Stations were all positive. Restaurants still have the biggest increases vs 21 & 19 but Relevant Retail stayed at the top of “real” performance vs 2019. However, only 53.2% of their growth is real.

Now, let’s see how some Key Pet Relevant channels did in February in the Stacked Bar Graph Format

Overall– 8 of 11 were down from Jan. Vs Feb 25, 8 were actually and 6 “really” up. Vs Feb 21, 11 were up but only 6 were real lifts. Vs 2019, Only Dept Strs & Off/Gift/Souv were actually & really down.

  • Building Material Stores – The pandemic focus on home has produced $ growth of 31.9% since 2019. Prices for the group have inflated 26.0% from 21 and 28.3% from 2019, which is having an impact. HomeCtr/Hdwe Sales vs Jan were -3.8% but +1.2% for Farm Stores. Vs other years, HomCtr/Hdwe are actually up & really down for all but 2019. Farm stores are actually up for all, but their Real $ were down vs 21. Bldg/Mat group’s 19>26 real growth was 2.8%. avg: 0.4%. HomeCtr/Hdwe: Ytd: 2.4%; Avg 19>26 Growth: 3.7%, Real: 0.1%; Farm: Ytd: +7.7%; Avg: 5.8%, Real: 2.1%
  • Food & Drug – Both are essential. Except for the COVID food binge, they tend to have smaller changes in $. Vs Jan: Supermarkets: -11.0%; Drug: -5.1%. In terms of inflation, the Groceries rate is 24 times higher than Drug/Med products. Drug Stores are positive in all measurements and 64.3% of their 2019>26 growth is real. Supermarkets’ actual $ are up in all comparisons, but vs Feb 25. They are only “really” up vs 2019 and only 8.7% of their 19>26 increase is real growth. Supermarkets: Ytd: +0.7%; Avg 19>26: +4.5%, Real: +0.4%; Drug Stores: Ytd: +1.5%; Avg: +4.4%, Real: +3.0%.
  • Sporting Goods Stores – They also benefited from the pandemic in that consumers turned to self-entertainment, especially sports & outdoor activities. Sales are -1.5% from Jan, but their only negative is real Ytd vs 21. Prices stopped deflating vs last year. Deflation started in April 23 and was a big change from +1.1% in 22>23 & +7.9% in 21>22. This caused 70% of their 44% lift since 2019 to be real. Ytd: 5.4%; Avg 19>26: +5.4%; Real: +3.9%
  • Gen Mdse Stores – Sales were -6.1% vs Jan. All YOY comparisons but 1 were up for $ Strs & SupCtr/Club (real vs 25) Dept Stores are negative in all comparisons but actual Feb/Ytd vs 21. Their Actual sales are even -33.3% from 19 (Real: -40.6%). The other channels have an average of 43.9% in real growth. SupCtr/Club: Ytd: +2.3%; Avg 19>26: 5.0%, Real: 2.4%; $/Value Strs: Ytd: +4.5%; Avg: +5.4%, Real: +2.7%; Dept. Strs: Ytd: -7.8%; Avg: -5.6%, Real: -7.2%.
  • Office, Gift & Souvenir Stores– Sales fell -4.3% from Jan. They are actually up Feb/Ytd vs 21. All others are down. Their recovery started late. It was slowly restarting in Jun/Jul, but their progress had slowed. It took off in Oct, slowed in Nov, grew in Dec, then slowed in Jan/Feb. Recovery takes some time. Ytd: -1.5%; Avg Growth Rate: -0.8%, Real: -2.4%
  • Internet/Mail Order – Sales are -5.1% from Jan to $110.2B, a Feb record. All YOY measurements are positive, but their YOY growth, +8.2%, is only 59.0% of their average since 2019. However, 81.6% of their 148.1% growth since 2019 is real. Ytd: +8.2%; Avg Growth: +13.9%, Real: +12.0%. As expected, they are by far the growth leader since 2019.
  • A/O Miscellaneous – Pet Stores are 22>24% of total $. In May 2020 they began their recovery which reached $100B for the 1st time in 21. In 22 their $ dipped in Jan, Jul, Sep>Nov, rose Dec, fell Jan>Feb 23, grew Mar>May, fell Jun>Aug, rose Sep>Nov, fell Dec>Jan 24, grew Feb>May, fell Jun>Sep, grew Oct, fell Nov, rose Dec, fell Jan>Feb, grew Mar>May, fell Jun>Sep, rose Oct, fell Nov, rose Dec, fell Jan, rose Feb. All comparisons are positive, and they are #2 in the increase vs 2019 but #1 vs 2021. Also, 78% of their 101% growth since 2019 is real. Ytd: +14.6%; Avg 19>26: 10.5%, Real: +8.7%

Feb had its usual drop vs Jan, but the Rel Retl drop was only half of the avg. 8 of 11 small channels were down. The YOY lift vs 25 was below avg for Total: -16% & Relevant Retl: -10%, but 4 big groups & 8 smaller channels had lifts. Also, prices are only deflating in Auto & Gas Stations, but cumulative inflation has an impact, as only 6 channels were really up vs Feb 21. The Recovery is slow. In Mar, the commodities CPI rose from 1.2% in Feb to 3.4%. Let’s see if it impacts Retail

Feb>Mar sales were up for all. A Feb>Mar Total Retail lift has happened in every year but 2020 since 1992. The 16% lift is 16.6% more than the 13.7% avg. There was only 1 YOY $ drop, 1 less than Feb. 4 Big Groups were up vs 25 but the Total Retail lift of 4.5% vs Mar 25 was 6.4% below their +4.8% 92>25 avg. However, the Relevant Retail 6.0% increase vs Mar 25 was 27% above their +4.7% avg. Inflation is still a factor. The CPI for all commodities rose to 3.4% from 1.2% vs last month and it is now +20.7% vs 21. There is some bad “real” news. In Jan/Feb, no “real” measurement was down. In Mar, there were 8. Plus, Gas Stations are again selling less Gas than in 2019. Also, only 2 Big Groups are all positive. In Dec>Feb there were 4. Positive Note: Relevant Retail has now been all positive in 22 of the last 24 months.

Overall Inflation Reality– The Total Retail CPI rose to 3.4% and the $ lift vs 25 was 6.4% below avg. The Restaurant CPI slowed to +3.7% but their $ lift was 72.5% below avg. The Gas CPI rose from -5.6% to +18.9%. They are still in turmoil. Auto inflation is  -0.9% vs 25 but +17.9% vs 21. Sales were -2.3% vs 25. Their avg change is +4.6%. Inflation rose to 2.3% for Relevant Retail but their lift was 27% above avg and they are again all positive. Big Group progress is slow in 2026.

Total Retail – Since Jun 20, every month but Apr 23, Jun 24 & Feb 25 has set a monthly $ales record. In 2023>26, Sales got on a roller coaster. Up Oct>Dec, down Jan 24, up Feb>Mar, down April, up May, down Jun, up Jul>Aug, down Sep, up Oct>Dec, down Jan>Feb 25, up Mar, down Apr, up May, down Jun, up Jul>Aug, down Sep, up Oct, down Nov, up Dec, down Jan>Feb, up Mar. Prices are 3.4% and YOY $ are +4.5%, 6.4% below avg. 42% of 19>26 growth is real. CPIs rose, but cumulative inflation may have the biggest impact on sales. Growth: 25>26: 3.8%; Avg 19>26: +6.0%, Real: +2.8%

Restaurants – They were hit hard by the pandemic and didn’t begin recovery until March 2021. However, they have had strong growth since then, exceeding $1T for the 1st time in 2023. Mar $ are up vs 25 and they have the biggest lifts vs 21 & 19. Inflation slowed to 3.7% vs last year, but it is +30.0% vs 21 and +35.0% vs 19. Their 1.6% YOY lift is 72.5% below their +5.7% 92>25 avg. They are no longer all positive and just 33% of their 63% growth since 2019 is real. They stayed 4th in performance. Recovery started late but inflation started early. Growth: 3.8%; Avg 19>26: +7.3%, Real: +2.7%. They just account for 13.8% of Total Retail $, but their strong growth has helped Total Retail.

Auto (Motor Vehicle/Parts Dealers) – They overcame the stay-at-home attitude with deals & advertising. They finished 2020 up 1% vs 2019 and hit a record $1.48T in 2021 but much was due to high prices. In 22, sales got on a rollercoaster. Inflation started to drop mid-year, but it caused 4 down months in $. Their YE real 22 sales numbers were even worse, -8.2% vs 21 and -8.9% vs 19. 23 started a sales rollercoaster but the $ hit a record, $1.595T. $ fell in Jan 24, grew Feb>Mar, fell Apr, grew May, fell June, grew Jul>Aug, fell Sep, grew Oct, fell Nov, grew Dec, fell Jan>Feb 25, grew Mar, fell Apr>Jun, rose Jul>Aug, fell Sep, rose Oct, fell Nov, rose Dec, fell Jan, rose Feb, fell Mar. Mar $ were -2.3% vs 25. Avg: 4.3%. They are no longer all positive and just 34% of 19>26 growth is real. Growth: 0.3%; Avg 19>26: +5.0%, Real: +1.9%

Gas Stations – Gas Stations were hit hard by “stay at home”. They started recovery in Mar 21, and inflation began. Sales got on a rollercoaster in 22 but set a record, $583B. Inflation started to slow in Aug and prices slightly deflated in Dec & Feb 23, then strongly fell in Mar>Jul to -20.2%. In Sep they were +2.7% but began deflating to -4.2% in Feb 24. In Mar>May $ grew, fell Jun, rose July, fell Aug/Sep, rose Oct, fell Nov>Feb 25, rose Mar>May, fell Jun, rose Jul, fell Aug>Oct, up Nov, fell Dec/Jan, rose Feb/Mar. Mar $ vs 25: +18.3% (4.4% avg). No $ downs but all real $, including vs 19 are down. Growth: +5.6%; Avg 19>26:+4.1%, Real: -0.9%. They show the impact of inflation can be “really” negative.

Relevant Retail – Less Auto, Gas and Restaurants– They account for ≈60% of Total Retail $ in a variety of channels. Their only down month until Feb 25 was Apr 20, and they led the way in Retail’s recovery. Sales got on a roller coaster in 22, but all months set new records with Dec reaching a new all-time high, $481B, and an annual record of $4.81T. In 23, the roller coaster continued. A Dec lift set a new monthly record of $494.7B & an annual record of $4.997T. $ales got back on the roller coaster in 24. The ride continued as $ rose Oct>Jan 25, fell Feb, rose Mar>May, fell Jun, rose Jul, fell Aug>Sep, rose Oct>Dec, fell Jan>Feb 26, rose Mar. The Mar 6% YOY lift is 27% above their 92>25 avg of +4.7%. They are all positive again and 53% of their 54% 19>26 growth is real, again #1 in Big Group performance. Growth: 4.8%; Avg 19>26: +6.4%, Real: +3.7%. In 2024 their inflation rate fell from 3.2% to 0.1%. It rose in 25 to 1.8% in Sep, slowed to 1.5% in Oct>Nov, rose to 2.0% in Dec>Jan & 2.3% in Mar. YOY Inflation is low, but its cumulative impact can slow growth.

As expected, Mar sales rose vs Feb. Total Retl was +16.0%, +16.6% above avg; Relevant Retl was +14.1%, +13.6% above avg. In Mar, 1 actual YOY $ comparison was negative, 1 less than Dec>Feb. There were 0 real drops in Dec>Feb. In Mar, there were 9. In Dec, all were up vs last year but only Rel. Retl’s lift was above avg. In Jan, 3 lifts, all below avg. In Feb, 4 lifts, all below avg. In Mar, 4 lifts. Rel Retl & Gas Stat. were above avg. In Dec>Feb, 4 big groups were all positive. In Mar, there were only 2. Relevant Retail has now been all positive in 22 of 24 months.  YOY inflation is growing, but still relatively low. However, cumulative & impending lifts can also affect sales. There are mixed results, so progress is slow.

Here’s a more detailed look at March by Key Channels in the Stacked Bar Graph Format

  • Relevant Retail: Ytd Growth: +4.8%; Avg 19>26: +6.4%; Real: 3.7%. % Real Growth: 52.9%. All 11 were up from Feb. Vs Mar 25: 10 were up, 7 Real. Vs Mar 21: 6 were up; 6 Real. Vs 19: Dept Stores were down & “real” Furniture Stores.
  • All Department Stores – This group was struggling before the pandemic hit them hard. They began recovery in March 21. Sales are +25.1% from Feb, but all YOY measurements but actual vs Mar 25 & Ytd vs 21 are negative. Their 1.3% Mar YOY lift is much better than their -4.4% avg. Ytd Growth: -4.3%; Avg 19>26: -5.4%; Real:-7.0%. % Real growth: None
  • Club/SuprCtr/$- They fueled a big part of the recovery because they focus on value which has broad consumer appeal. $ales are +14.0% from Feb, and they are up in all comparisons. Their 3.1% YOY Mar lift is -64% below their 92>25 avg of +8.4%. Ytd Growth: 2.7%; Avg 19>26: +5.0%; Real: 2.4%. % Real Growth: 41.8%
  • Grocery- They depend on frequent purchases, so their changes are usually less radical. $ales are +9.5% from Feb. They are actually up for all but really down for all but vs 2019. Cumulative inflation has hit them hard. Their +0.3% YOY Mar lift is 89% below their +3.2% avg. Ytd Growth: 0.5%; Avg 19>26: +4.3%; Real: 0.2%. % Real Growth: 5.0%
  • Health/Drug Stores – Many stores are essential, but consumers visit less frequently than Grocery stores. $ are +10.6% from Feb and they are positive in all YOY comparisons. Inflation has been relatively low, so it is surprising that their +3.0% YOY lift vs Mar 25 is 42.7% below avg. Ytd Growth: 2.0%; Avg 19>26: +4.4%; Real: 3.0%. % Real Growth: 65.4%
  • Clothing and Accessories – Clothes mattered less if you stayed home. That changed in March 2021 with strong growth through 2022. Sales are +18.9% from Feb and positive in all YOY measurements. $ales are +7.0% vs Mar 25, more than double their 3.4% avg. Ytd Growth: 7.1%; Avg 19>26: +3.5%; Real: 2.3%. % Real Growth: 64.0%.
  • Home Furnishings – In mid-2020 consumers’ focus turned to their homes and furniture became a priority. Inflation is 4.3% in Mar. $ are +15.2% from Feb but they are only actually up vs 2019. All real sales are down. YOY vs Mar 25, they are -0.4%, far below their 3.3% avg lift. Ytd Growth: -2.8%; Avg 19>26:+2.3%; Real: -0.2%. % Real Growth: None.
  • Electronic/Appliances – They have had many issues. $ fell in Apr>May of 2020 and didn’t reach 2019 levels until March 21. $ are +9.4% from Feb and they are up in all but vs Mar 21. Strong deflation made real sales very high. Sales are +6.1% vs Mar 25, 2.8 times above the 2.2% avg. Ytd Growth: 5.3%; Avg 19>26: 0.8%; Real: 4.0%. % Real Growth: 100+%
  • Bldg Matl, Farm & Garden & Hdwe – They truly benefited from the consumers’ focus on home. In 2022 the lift slowed as inflation grew to double digits. Prices turned up again in Apr>Sep 25, dropped Oct/Nov, rose Dec/Jan to 5.6%, fell Feb to 4.8%, rose Mar to 6.0%. Sales are +27.8% from Feb and are only actually down vs Mar 21 & really up vs 2019. Sales vs Mar 25 were +5.3%, 27% above their 4.1% Avg. Ytd Growth: 4.0%; Avg 19>26: 4.4%; Real: 0.7%. % Real Growth: 14.5%
  • Sporting Goods, Hobby and Book Stores – Consumers turned their attention to recreation and Sporting Goods stores sales took off. Book & Hobby Stores recovered more slowly. They have been on a sales roller coaster since June 24 and $ are +19.3% from Feb. All YOY comparisons, but actual & real vs Mar 21 are positive. YOY Sales vs Mar 25 are +5.3%, 61.8% more than their 3.25% avg. Ytd Growth: +7.2%; Avg 19>26: +4.5%; Real: 3.7%. % Real Growth: 79.5%.
  • All Miscellaneous Stores – Pet Stores have been a key part of the strong and growing recovery of this group. They finished 2020 at +0.9% but sales took off in March 21 and have continued to grow. Sales are +12.8% vs Feb and positive in all comparisons. They are 2nd in the % increase vs 19 & vs 21. Plus, their 10.3% YOY Mar lift is 2.2 times more than their 92>25 avg of +4.7%. Ytd Growth: +12.0%; Avg 19>26: +8.1%; Real: 6.3%. % Real Growth: 73.4%.
  • NonStore Retailers – 90% of their $ comes from Internet/Mail Order/TV. The pandemic accelerated online spending. They ended 2020 +21.4%. The growth continued in 2021 as sales exceeded $100B for the 1st time and they broke the $1 Trillion barrier. $ are +13.3% from Feb and their YOY lift of 13.2% is 33.6% above the 9.9% avg. Plus, they are positive in all comparisons. Ytd Growth: 9.7%; Avg 19>26: +13.1%; Real: 11.2%. % Real Growth: 80.3%.

Recap – Driven by Relevant Retail, the Pandemic recovery was widespread by Y/E 21. In 22 we were hit with the strongest inflation in 40 years. Inflation has slowed considerably from its Jun 22 peak, but only 1 smaller channel is now deflating. Deflation helps, but cumulative inflation can still have a negative impact – slowed YOY growth and even sales drops. As expected, $ rose from Feb for all small channels. 10 of the 11 lifts were above avg – Very Good! The biggest concern is still YOY drops and smaller lifts. Relevant Retail’s 6.0% lift vs Mar 25 was 27% above avg. 10 channels had a YOY lift vs last year, 2 more than Feb. 7 of the 10 lifts were above avg, 3 more than Feb, but equal to the 7 back in Oct 25. There are multiple factors slowing growth, but the major one is high prices from cumulative inflation. Dec is the biggest retail month, and Feb is usually the worst. The Feb>Mar lift is 2nd to Nov>Dec. Total & Relevant Retail had record monthly sales for Dec>Mar. The Mar Yoy lift was -6% below avg for Total but +27% above for Relevant. The situation is definitely better than Feb as only 4 of 11 channels (7 in Feb) had a below avg lift or a drop vs 25. We’ll see what happens.

Here are the Feb/Mar inflation rates for the CPIs used to calculate the impact of inflation on retail groups and channels. This includes special aggregate CPIs created with the instruction and guidance of the US BLS. I also researched data from the last Economic Census to review the share of sales by product category for the various channels to help in selecting what expenditures to include in specific aggregates. Of course, none of these specially created aggregates are 100% accurate but they are much closer than the overall CPI or available aggregates. The data includes the CPI changes vs 21 to show cumulative inflation.

Monthly YOY CPI changes of 0.2% or more are highlighted. (Green = lower; Pink = higher)

Here are some answers to some obvious questions. Note: Inflation only slowed for Grocery, Furniture & Electronics.

  • Why is the group for Nonstore different from the Internet?
    • Non-store is not all internet. It also includes Fuel Oil Dealers, the non-motor fuel Energy Commodity.
  • Why is there no Food at home included in Nonstore or Internet?
    • Online Grocery purchasing is becoming popular, but almost all is from companies whose major business is brick ‘n mortar. These online sales are recorded under their primary channel.
  • 5 Channels have the same CPI aggregate but represent a variety of business types.
    • They also have a wide range of product types. Rather than try to build aggregates of a multitude of small expenditure categories, it seemed better to eliminate the biggest, influential groups that they don’t sell. This method is not perfect, but it is certainly closer than any existing aggregate.
  • Why are Grocery and Supermarkets only tied to the Grocery CPI?
    • According to the Economic Census, 76% of their sales comes from Grocery products. Grocery Products are the driver. The balance of their sales comes from a collection of a multitude of categories.
  • What about Drug/Health Stores only being tied to Medical Commodities.
    • An answer similar to the one for Grocery/Supermarkets. However, in this case Medical Commodities account for over 80% of these stores’ total sales.
  • Why do SuperCtrs/Clubs and $ Stores have the same CPI?
    • While the Big Stores sell much more fresh groceries, Groceries account for ¼ of $ Store sales. Both Channels generally offer most of the same product categories, but the actual product mix is different.