Families struggle to buy food

Putting food on the table is becoming a financial stretch for Americans of all income levels, according to a marketing research report.

With budgets "strained to the breaking point" by rising costs for gasoline, energy, food and other necessities, more than half -- 56 percent -- of consumers earning less than $35,000 a year are having difficulty buying the groceries they need, the report said.

Forty-four percent of consumers earning between $35,000 to $54,900 are in the same predicament, as are 24 percent of those making $55,000 to $99,900, and 16 percent of those making $100,000 or more.

The median household income in Sonoma County was $60,821 in 2006, according to the U.S. Census.

"These are very alarming statistics," said Sheila McCusker, a partner in Information Resources Inc., a private company which tracks consumer spending and released the report. "We're not talking about people saying, 'I can't buy that flat-screen TV' but 'I can't feed my family.'"

Among the beneficiaries of the trend are discount supercenters like Wal-Mart, while both conventional grocery stores and convenience stores are losing business, the report said.

The firm's findings are based on a survey of 1,000 consumers in May and are included in a consumer-goods industry report titled "Competing in a Transforming Economy."

Rising prices for staples -- such as eggs, pasta, infant formula, milk and bread -- have stretched family food budgets, and while some of these may ease, other basic costs, such as diesel fuel, are unlikely to subside until 2009, the report said.

"As a result, we can expect continued belt tightening and behavioral shifts among consumers for at least the next 12 months," the research firm said.

Asked why higher-income consumers would have trouble buying food, McCusker said that people earning more than $100,000 typically own large homes and multiple large vehicles, which are expensive to maintain.

To cope with spiraling food costs, American families are getting reacquainted with the kitchen stove: buying basic ingredients and fixing meals at home. Fifty-three percent of consumers are "cooking more from scratch" than they did six months ago, the report said.

"What we're seeing is a return to basics," McCusker said. There's a huge opportunity, she said, for retailers to provide the means for feeding a family of four for $10 a night.

Sales of perishable groceries have sharply increased in the past year, while sales of non-food grocery-store items, such as paper and light bulbs, have plummeted. Sales of health-care products, including non-prescription drugs, are still growing, but spending on beauty and personal care products is declining.

Not only how but where shoppers spend their food dollars is shifting dramatically.

Shopping trips to supercenters like Wal-Mart, which sell food and general merchandise, have spiked in the past year and were up 5.4 percent in the first quarter of 2008, the report said.

Supercenters offer consumers discount prices and "one-stop shopping," which also saves gas, McCusker said.

Wal-Mart recently reported its best monthly sales gain in four years.

Grocery and drug stores have been losing traffic, and convenience stores, including those at gas stations, have lost even more business.

Club stores, such as Costco, had gains early last year but sales are now flat, a trend McCusker attributed to the cost of large-package purchases, which may be bargains but also can be budget-busters.

The shift in shopping patterns is the "biggest, fastest change I've seen in 20 years," McCusker said.