Penny pinching this Thanksgiving may not be as simple as buying generic, or store-brand goods, according to a new report out today by Wells Fargo’s Agri-Food Institute, which researches the food and beverage industry.
Wells Fargo chief agricultural economist Michael Swanson and his team put together a typical Thanksgiving meal for ten people (complete with fresh cranberries) and found that, while avoiding name-brand products resulted in a savings of $17, generic goods were getting more expensive but that name brand goods were getting cheaper.
The converging prices could result in more choices as customers accustomed to buying budget brands might decide to splurge on name brands, says Robin Wenzel, group head, Wells Fargo’s Agri-Food Institute. "This Thanksgiving it's really going to be an opportunity to mix and match based on personal preference and taste," she says. "We think that consumers will go out there and be able to shop around."
The menu for 10 diners, including name brand turkey, stuffing, salad, cranberries, dinner rolls and pumpkin pie will cost $90 this year, a decrease of 0.5% compared to last year. While making the meal with store brand goods would only cost $73, that’s a 2.7% increase since last year. Last month, the National Retail Federation that tracks consumer spending predicted record spending during this holiday season, starting on Thanksgiving, totaling $902 per person on gifts, food, decorations and other seasonal items.
The America Farm Bureau last year reported that the average cost of a Thanksgiving meal in 2023 fell for the first time in years after reaching a record high in 2022.
Name brand turkeys are still cheaper than generic turkeys this year. But name brand birds dropped 2% compared to last year while store brands increased five percent. A 12-ounce bag of name brand fresh cranberries is down 3% since last year while the same size bag of generic cranberries is up six percent. Name brand pumpkin pies are up one percent while the store brand is up three percent compared to a year ago.
“We’re really seeing those name brand prices come down,” says Wenzel. “And get more competitive in the space.”
As with so many business stories today, the quirky dynamic goes back to Covid, according to the researchers, who say many name brand food suppliers overcompensated for quarantine inflation and have had to reduce prices to meet the new market norms.
There are, however, exceptions to the trend, especially among bread-based items. Name brand and store brand dinner rolls increased three percent over last year, and name brand stuffing was up nine percent over last year compared to store brand stuffing's three percent increase.
