Times are hard. Fortunately, we are a resourceful people. Rough, even. Food inflation falls on us like Hitchcock’s birds in The Birds ? Watch us weave through the supermarket rows, from one price cut to the next, holding our flyer like a coded map for an exciting treasure hunt. And if yesterday we happened to delight at the sight of broccoli, today our taste for loose potatoes has reached new heights.
We carry with us, at all times, our own anti-inflation shield. The phenomenon did not go unnoticed by one of the most perceptive members of our national 1%, the CEO of Metro, Eric Richer La Flèche.
In interview at Montreal Journal this week, Mr. Metro-Super C revealed to us the existence of a new unit of measurement for inflation, integrating our resourcefulness into the equation, and therefore closer to reality than the Statistics index. Canada. It is, he tells us, “internal inflation”. It does not measure the evolution of the price of products, but the evolution of the products purchased. You follow me ? I feel not. So here it is. Since last year you bought broccoli and this year you prefer potatoes, the price of your purchases has increased less. Isn’t that fantastic? Mr. Laflèche explains: “People adjust their behavior. They buy less expensive foods, private label products, they buy on special. All of this means that the real inflation that we are experiencing is lower than the inflation published by Statistics Canada.
Replacing chicken with baloney is certainly a winning anti-inflationary strategy. The CEO has a good lead. But he doesn’t follow through with his logic. Let’s help him. More than one in ten of its clients now get their supplies from food banks. This is an avoided cost that also undoubtedly reduces your grocery bill. There is also the decision to no longer eat fish at all. Have you thought about it, Mr. Laflèche? It counts ! Apparently skipping one or two meals a week helps to contain internal inflation.
I don’t know about you, but over the past few months, social media algorithms have decided that I was a perfect candidate to indulge in intermittent fasting and are bombarding me with ads about it. To indulge in it is to play a trick on food inflation. She won’t recover.
A less harsh strategy is to go to restaurants less often, or not at all, and to fall back on cooking at home. A boon for brands. Sales at Metro increased by almost 7% in one year (and 5% at competitor Loblaw, owner of Maxi and Provigo). See, inflation is a grocer’s paradise.
Fortunately, small consumers can fall back on a saving tool: the credit card. Equifax tells us that, without even calculating the mortgage debt and the staggering increase in rates, the average debt of credit users has reached a record of $21,131. Per person. This amount is equivalent to more than a third of the median income of Quebec households. This new peak, explains the firm, is not mainly attributable to the increase in debt of current holders of plastic cards. No. The swelling is produced by the influx of new cardholders. Those who, despite reduced internal inflation, frequenting food banks and, perhaps, the practice of intermittent fasting, must still look for a breath of fresh air in the vortex of life on credit.
Fortunately, big grocers don’t have hearts of stone. Aware of the emergency and knowing that their own economic well-being depends on their reputation with a clientele essentially captive to an oligopoly, they spontaneously decided to limit their profits — which were sharply increasing — to their pre-pandemic level and to pay the extra jackpot in discounts on essential food products. Their management also froze their salaries and abolished their bonuses until official food inflation returned to around 2%.
Did you laugh as much when you read the previous paragraph as I did when I wrote it? In reality, profits jump briskly from quarter to quarter, like the remuneration of the grocery giants. Mr. La Flèche admitted this week that he sometimes did his own shopping. Aware of the scandalous rise in the price of butter, he sometimes buys several pounds when sales bring the price below five dollars and freezes them to eat when prices exceed eight dollars. A necessary precaution since, last year, he received total remuneration of $5.4 million, an increase of 6.8% over the previous year. His annual bonus also jumped 15%, to 1.5 million.
So he and his friends in the 1% are faced with difficult decisions. Since their income is increasing, how can they change their behavior to avoid ending up with too much savings? Does their own internal inflation push them to make substitutions? Instead of the Lexus, the Porsche? Instead of the five-star hotel, the private island? Instead of a luxury yacht cruise, a little trip into orbit?
But I trust them.
Faced with inflation, they are the most resourceful of all.
Jean-François Lisée led the PQ from 2016 to 2018. He has just published Through the mouth of my pencils published by Somme Tout/Le Devoir. [email protected]