Consumers more sensitive to rising prices and shrinking portion sizes

Some might call it a cost push inflationary diet.

Rising gas prices in the US are being blamed for more expensive groceries, smaller restaurant portions and a hike in restaurant prices, says a new report released Monday.

And that translates to a reduced splurge on premium ice creams, nights dining out, and an increased reliance on coupons and deals, says market research consultant Technomic.

The results are telling, says Bob Goldin, executive vice-president, noting that consumers have become more sensitive to portion sizes and value for money.

Their survey, for instance, found that 84 percent of the 1,000 consumers polled in April believe that grocery prices have risen in the past three months, while 62 percent believe that restaurant prices have also risen.

For many US consumers, the rising cost of food isn't in their imagination. Both Kraft Foods and Sara Lee hiked prices and McDonald's warned of a small price increase on their menu items as well. These increases have largely been blamed to rising commodity costs.

Rising gas prices related to transportation and shipping are also being passed on to the consumer.

Source: independent.co.uk