The Real Deal: Pricing with Purpose—When Grocery Shoppers Hold the Gavel

In today’s grocery aisle, consumers still reign. They wield the gavel, slamming it down on anything that looks like padding as they continue to grapple with economic pressures. Inflation may have slowed, yet it continues to nibble at paychecks: the all-items CPI rose +2.7% YoY in June, while groceries were up +2.4%. And the USDA expects food-at-home prices to finish 2025 up another +2.2%, on top of a 25% cumulative climb since 2020.

Shoppers aren’t just trading down; many are trading out. More than 60% of U.S. consumers have already changed, or expect to change, spending behaviors—from reducing discretionary purchases to switching to lower-tier brands. Four in 10 adults now identify as value seekers and are only buying essentials, and 18% report leaving the store with fewer items than planned. In fact, over half of Gen Z consumers have traded down in brand quality or opted for cheaper options.

Facing these trends, retailers have become consumer advocates, scrutinizing every penny suppliers add to the shelf. Value-centric banners are setting the reference price shoppers carry into every aisle. Since January, MPG’s Omnichannel Strategic Sales Services account teams have participated in more than 50 pricing negotiations. Here, they distill what separates “approved” from the “resubmit.” The actionable insights that follow can help you walk into those discussions better prepared to execute pricing actions that meet internal margin targets while enabling retailers to grow shoppers’ baskets.

Retailers’ new rules of engagement

Across major retailers, mindset has shifted from cost recovery to shopper defense.

Kroger requires a 60-day notice on price increases and takes a detailed look at drivers and components of increases. A cost change will trigger a negotiation, starting with an ask for everyday allowances to help hold them to certain retails, and a detailed 12-month promo calendar. For more insights, contact Ashley Curtis at ashley.curtis@mpgllc.com .

H-E-B expects granular data to vet price increases by their COGs team. Tariff-related increases must be broken out in a separate cost surcharge form, setting up a future renegotiation. For more insights, contact Erin Hyde at erin.hyde@mpgllc.com.

Wegmans remains open to price increases with solid rationale. Their official policy is 45-day notice, but some buyers are pushing back on accepting increases until they see the marketplace move retails. Large vendors can also expect Wegmans to schedule a meeting with department leadership to discuss any proposed price changes. For more insights, contact Kimberly Kowalik at kimberly.kowalik@mpgllc.com .

Wakefern pushes back on tariff driven hikes, citing shopper impact and its locked-in promo calendar. Changes filed with fewer than 90 days’ notice meet stiff resistance. With promotions finalized 8–10 weeks in advance, suppliers who give fewer than 90 days’ notice will face tough pushback. One major CPG that missed the deadline secured Wakefern approval only after funding extra scan support to return August retails to the levels already agreed. Still, Wakefern will accept a price hike, but only with robust documentation. For “indirectly tariff-related” changes—such as shifting sourcing or production to avoid China tariffs—suppliers must spell out ingredient moves and origin changes to provide full visibility. For more insights, contact Rosemary Dumala at rosemary.dumala@mpgllc.com .

If you are interested in obtaining insights on other grocery retailers, please contact Mike Sainsbury at mike.sainsbury@mpgllc.com.

What’s working…and what’s not

Since January, MPG has coached suppliers through more than 50 pricing moves. Based on our team’s first-hand experiences, customer-centric, customized and risk-managed paths are working best for successful price execution in today’s volatile landscape. Among the key considerations to take when executing a pricing change:

Address tariff related actions early and transparently

Signal intent early to maintain trust and retain flexibility
Explore agile solutions, such as tariff surcharge
Anticipate pushback and requirements: mitigation plans, documentation, adjustment of tariff subsidies

Lead with Revenue Growth Management

Lead with a mindful portfolio - and consumer-centric approach, for the most positive outcome
Ground decisions in consumer insights to mitigate push back: have a deep understanding of elasticity and when/where/why consumers buy your brands to validate changes
Employ a select mix of increases and decreases to offer a variety of options for margin adjustments
Protect opening price points and key price thresholds, prioritize resilient categories and SKUs to hold a value position for consumers
Take the opportunity to simplify price points, tiers and promotional bundles to allow for future trade support

Fortify sell-in with strategic customer engagement

Build an engagement plan that aligns messaging, tracks progress, and flags risks
Involve senior leadership to accelerate acceptance and ensure smoother implementation

Remember, retailer-specific customization is critical for success

Deliver foundational execution with timely, clear documentation and consistent positioning
Tailor your approach to each customer’s dynamics
Consider selective, short-term investments to prevent distribution loss, support promo prices. Remember, the goal is to win the war, not the battle.

The bottom line

Consumers came into 2025 exhausted by pandemic spikes, tariffs, and “temporary” hikes that never rolled back. They’re voting with their wallets, and retailers are campaigning on their behalf. Price proposals that lack a shopper-first storyline will sink fast, as the shopper’s gavel comes down hard.

MPG’s Omnichannel Strategic Sales Services account teams are partnering with suppliers to anticipate the tough questions, quantify elasticity, and craft sell-in decks that win in today’s volatile retail landscape.

Ready to pressure-test your next price play? Reach out to Mike Sainsbury, Vice President, Strategic Food/Grocery, at mike.sainsbury@mpgllc.com to explore the right strategy for your business.