If given the choice between grabbing dinner at a local restaurant or having to grocery shop and cook at home, many people would choose the former.
There’s something to be said for walking into a restaurant, ordering something on a whim, and not having to deal with any of the prep work or cleanup.
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But there’s a reason why so many people are spending more money at the supermarket these days, and less money dining out.
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Inflation has remained annoyingly elevated since the start of the year. And while prices aren’t rising at as rapid a pace as they were a few years ago, a lot of people are still struggling to cover their costs.
It’s hard to justify spending $40 on a restaurant entree when you could head to your local grocery store and spend the same amount on three nights of dinner for your entire family. So even if you’re someone whose preference is not to cook, you may not have a choice.
A growing supermarket chain has defied a trend amid the threat of tariffs.
Image source: Getty Images
Groceries could get more expensive once tariffs take hold
Not only are consumers today dealing with the impact of inflation, but they’re also grappling with the uncertainty around tariffs.
It’s unclear what will come of the tariff situation once the current pause expires. But the fear is that essential goods are going to become a lot more expensive.
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That’s bad news for consumers and retailers alike.
If consumers are forced to cut their spending, we could see an uptick in retail store closures and bankruptcies. And if retailers see the cost of procuring inventory increase, they’re going to have no choice but to pass at least some of the expense along to cash-strapped consumers.
Recently, Walmart issued a stern warning on tariffs and said that it may not be able to absorb incoming cost increases on its own without raising prices.
If a giant like Walmart is forced to charge more for groceries and other goods, smaller retailers may be especially prone to increases.
Expanding grocery chain claps back at tariffs
At a time when so many retailers are making plans to raise prices, Aldi is doing the opposite. The popular discount grocery chain announced this month that it plans to cut prices on nearly 25% of its inventory through Labor Day.
Almost all of the discounted items are part of Aldi’s assortment of private labels, which constitute the bulk of its inventory. The goal is to offer consumers ongoing relief at a time when most retailers are raising prices, or gearing up to do so.
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“This isn’t a one-week sale,” said Aldi COO Scott Patton. “We want our customers to come in week after week and have the same price and not have it go up and down all the time.”
Even though most of Aldi’s discounted products will be private-label items, around 6% of the store’s planned price reductions will apply to national brands.
Aldi is on a mission to expand its U.S. footprint, with an ambitious goal of opening 800 new stores by the end of 2028.
In 2025 alone, Aldi has opened 55 stores so far and has plans to debut another 75 this summer.
It’s Aldi’s reliance on private-label products that’s making it possible for the store to offer discounts during these uncertain times. Because the chain has such strong relationships with its suppliers, it’s able to more easily negotiate prices.
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Aldi can then pass those savings on to consumers. And at a time like this, that’s crucial.
Related: Walmart makes surprise cuts as it looks at tariff price hikes
