The Covid-19 virus is taking a fearful toll not only on lives but also on U.S. commerce, and now even everyday staples are feeling the pinch.
Grocery stores saw a sharp spike in card-based purchase volume in March as consumers scrambled to lay in supplies against the rapid spread of the pandemic, but by the end of the month that momentum had flattened out, according to data from CMSPi, a U.K.-based payments-research center with U.S. offices in Atlanta. Meanwhile, gasoline purchases on credit and debit cards held steady until mid-month but then began trending steadily downward, the data show.
With the onset of the national emergency March 13, grocery sales spiraled as transactions on cards shot up 30% that day compared to the prior two Wednesdays. Dollar volume was more than double the previous Wednesdays. The average ticket rose to $75, more than 60% higher than at the start of the month. CMSPi’s report indexes transactions, dollar volumes, and average tickets for each day of the month to their Feb. 28 levels but does not state absolute figures.
But the surge quickly exhausted itself, with transaction levels and dollar volumes falling slightly below their Feb. 28 levels by the end of the month, though average tickets were still about 15% higher. The CMSPi analysts credit the higher tickets to consumers sheltering in place and so spending more on fewer trips to the store. This trend may have been reinforced, they say, by rules in many places requiring restaurants and bars to offer only takeout and delivery service.
But they warn that the sky-high unemployment numbers reported recently—6.65 million filed claims in the week ended March 28—indicate less spending overall in the near term, including on groceries. “Grocers may need to look out for a long-term negative impact on spending,” the report says.
Petroleum retailers, meanwhile, saw overall dollar volume on cards drop by 50% over the course of the month. Some of this may be attributable to a dramatic drop in the price of gas, but the volume of transactions at month’s end was just 60% of the daily volume March 1. Also, shelter-in-place orders are confining consumers to fewer and shorter trips by car, the report adds.
Still, while gas prices fell by 16% on average over the month, the fuel industry’s average ticket was down by 14%, leading the analysts to speculate convenience-store sales may have in part propped up average per-transaction sales volumes.