It may feel like the world is filled with changes and uncertainty right now.
2025 has kicked off with a new presidential administration, lingering higher prices on everyday items, geopolitical tension, and economic volatility.
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And it’s still January.
One thing is for sure, though. People across the country are feeling the pinch at common markets, like grocery stores or big box retailers, as they shop for core essentials and consumer goods.
The most recent Consumer Price Index for December was released earlier in January, and it shows that the cost of key staples and services was up by 0.4% overall. This puts the 12-month inflation rate at 2.9% — which is at the higher end of what analysts had foreseen. Most predicted the report coming in at between 0.3% to 2.9%.
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Here’s a look at how some of our core materials and services changed in December compared with the previous month:
- Food: up 0.3%
- Energy: up 2.6%
- Gasoline: up 4.4%
- New cars: up 0.5%
- Used cars: up 1.2%
- Apparel: up 0.1%
- Shelter: up 0.3%
- Transportation: up 0.5%
- Medical care: up 0.2%
- Medical Care Commodities: 0.0%
Notably, the cost of every measured good or service rose compared to November 2024, except for medical care commodities, which stayed the same across the month.
Image source: Getty Images
Customers seek havens from high prices
Naturally, more and more customers are trying to find practical cost cutting measures and save money where they can.
This has been great news for well-known budget friendly retailers with far reach, like Walmart (WMT) . Walmart has boasted in recent quarters that it’s seeing more interest and sales, particularly from a higher income cohort of customers seeking refuge from high prices at other grocery stores.
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“We are seeing customers trade into Walmart,” CFO John Rainey explained, claiming shoppers who make $100,00 or more annually are showing preference for Walmart thanks to its lower prices.
“We’re seeing higher engagement across income cohorts, with upper-income households continuing to account for the majority of the share gains,” he added.
Big retailers give customers more
So many budget retailers are starting to give customers more options.
Walmart, for example, introduced Bettergoods, a new line of in-house, quality foods with novel flavors — at near unbeatable prices. Some of those new products include Pistachio Nut Butter, Oatmilk Non-Dairy Frozen Desserts, and Campfire Roasted Salsa.
Not to be beaten out by a deal, Dollar General DG announced in January that it would introduce over 100 new in-house items, mostly under its Clover Valley brand.
Some of the new items include salad dressings, eight new flavors of ice cream, coffee syrups, and cinnamon rolls.
In-house, or private label brands are big business. According to recent data by Circana, sales of private label brands increased by 4% to $271 billion in 2024. Brand name sales were up by just 1%, indicating shoppers are seeking cost saving opportunities over brand name.
As it stands now, Dollar General sells approximately 3,200 products under a private label brands. Some of those include:
- Clover Valley
- DG Health
- TrueLiving
- Smart & Simple
- Heartland Farms
- Studio Selection
Dollar General claims that over half of customer purchases contain at least one private label item, so the retailer is betting that this new expansion will equate to more sales. It is planning to open 300 new locations by the end of the year.
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