Asda has seen shoppers limit their spending to £30 at tills and petrol pumps, as the cost of living crisis continues to squeeze budgets.
The Big 4 grocer chairman Stuart Rose stated customers were using various tactics to limit spending including placing fewer items in their baskets, and opting for budget ranges.
“What we’re seeing is a massive change in behaviour,” Rose told the BBC.
“People are trading back. They are worried about spending. They’ve got a limit that they’ve set out, too. They say £30 is one limit … and if they get to more than £30 then that’s it, stop. It’s the same with petrol.”
Rose, who previously worked at M&S, Argos and TopShop, has observed the industry for decades – tracing patterns including last year’s jump in inflation which he compared to a “train coming through a tunnel with a big flashing light on the top”.
The comments come amid the record levels of inflation of 9.1% in May, the highest in 40 years.
Rose has been a vocal critic of government spending, previously calling the Chancellor’s response to the cost of living crisis “tin-eared and slow”.
“I would urge them to do more for those people at the bottom end of the earnings income scale,” Rose said, suggesting a VAT reduction or another reduction in fuel tax would be “helpful”.
He added: “I’m of the generation that remembers what it was like last time. And once [inflation] gets hold, it’s quite pernicious. And it takes a long time to eradicate … We’re in danger of being in a place that it’s very difficult to extricate ourselves from.”
“What’s rather sad is that the country, the government, perhaps the Bank of England, didn’t see inflation coming quickly. They’ve now recognised that.”
In terms of how Asda is mitigating costs passed onto consumers, Rose assures they doing “everything we can” and have invested nearly £100 million in the past month to ensure customers get essentials at “very, very attractive prices to try and help them.”
According to the Asda boss, bringing down inflation should be the “most important priority”.
He concluded: “Once inflation gets embedded, it’s very, very hard to kill. If it means we have to slow the economy down for a while, and it looks as if we are heading for a recession, then so be it.”