US grocery slowdown enters a new phase as stretched consumers buy less -- Bain & Company analysis

New analysis of NielsenIQ data reveals falling unit sales across every US region as consumers cut basket sizes, turning the grocery marketplace into a share game for the industry

BOSTON, July 16, 2026 /PRNewswire/ -- The US grocery slowdown has entered a decisive new phase of falling unit sales as stretched American consumers pull back and buy fewer items, Bain & Company reports today in a new analysis with NielsenIQ.

The slowdown in US grocery began in mid-2025 with the emergence of a clear trend of negative unit growth. But Bain and NIQ report that it has accelerated since February, with units sold now having stepped down sharply, dropping by around 2% year-on-year in most of the subsequent four months up to June, and consistently across US regions. This comes alongside continuing increases in grocery bills, with grocery prices still climbing at a rate of 2% to 3% year-on-year. Overall, US grocery units sold were down by 1.8% year-on-year in June, marking a nearly two percentage point deterioration in a single year.

No single shock is to blame for the grocery slowdown, Bain's analysis concludes. It finds that pressure has been steadily building on US consumers and intensified notably this year. One key factor was that participation in the Supplemental Nutritional Assistance Program (SNAP) for lower-income households dropped sharply late last year, adding to stresses on this group. More importantly, in March, gas prices then climbed by 20% across the US, in another sizeable hit to consumers' weekly budgets already strained by inflation that has seen a 33% cumulative rise in grocery prices since 2019, broad-based price rises across spending categories, and falling growth in disposable incomes.

The growing impact of the pressure on Americans' pockets shows Americans trying to spend less, Bain reports. In Bain's latest Consumer Lab pulse survey, 80% of Americans reported trying to cut spending, with 28% actively trying to cut back on groceries. Among those trimming grocery bills, 56% are trading down to lower-priced brands, 49% are simply buying fewer items, and 44% are leaning harder on coupons and promotions.The trend for some US grocery shopping to move online is also contributing to the pull back in units sold, with online shoppers typically opting for smaller baskets. Bain notes that rising use of GLP-1 weight loss medications is another factor, with users buying fewer groceries as a result, including 30% to 40% who are actively trying to cut back on groceries.

Bain's Consumer Health Index also captures the strain. The CHI composite outlook has only just clawed back to neutral after sliding for much of the past year, and intent-to-spend among lower- and middle-income households sits at or below the long-term average. A tax-refund season worth roughly $50 billion more than last year's and lingering cash reserves from the pandemic are keeping nominal spending afloat, but inflation and high gas prices keep pulling the other way.

Grocery has become a share game

For the grocery sector, the consequence of the shift by consumers is to make grocery retailing a share game, Bain finds. Value players, from discounters and dollar stores to mass and club, look to be gaining consumers and trips as shoppers continue to trade down. Yet the unit problem does not disappear even for them, the report notes. It concludes that the grocers that pull ahead in coming months will be those that sharpen their value proposition, price sharply on the products shoppers, as well as AI agents, notice most, and use promotions, loyalty, and private brands with precision to build a value story consumers can trust.

"The data is unambiguous: US grocery is in a genuine volume contraction, and the path back to growth is not just about low prices, but a value story that shoppers believe in and come back for. The grocers and manufacturers that invest now in sharpening that proposition will be positioned to take meaningful share once the broader, market-wide conditions affected by inflation, including from gas prices, eventually shift. Retailers that respond with precision – on assortment, promotion, and private label – will be best placed to capture the trips that are still up for grabs," said Kurt Grichel, head of Bain & Company's Americas Retail practice and co-author of the report.

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Notes to Editors

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About NielsenIQ

NielsenIQ (NIQ) is a leading consumer intelligence company, delivering the most complete understanding of consumer buying behavior and revealing new pathways to growth. Our global reach spans over 90 countries covering approximately 85% of the world's population and more than $7.2 trillion in global consumer spend.

SOURCE Bain & Company