UAE households are changing how they shop for groceries, buying fewer items and switching to budget stores even as official figures show food inflation has sharply declined. Despite a drop from 3.7 per cent in early 2024 to a projected 0.36 per cent by 2025, according to the Central Bank of the UAE, a widespread perception of high prices continues to influence consumer behaviour and reshape the retail landscape.
Shopper Behaviour Shifts Amid Inflation Concerns
A recent global survey by Blue Yonder, which included shoppers in the Middle East, found that 85 per cent of consumers remain worried about grocery inflation. This anxiety is translating directly into new habits at the checkout. The research revealed that 65 per cent of consumers are now buying fewer grocery items, while 42 per cent are actively seeking out discount or wholesale stores.
This trend is evident across the Emirates, where shoppers are becoming more deliberate. Many now chase promotions (36 per cent) or switch to more affordable private-label brands (34 per cent) to manage their budgets. Retailers in Dubai and Abu Dhabi confirm that foot traffic now peaks during promotional periods. “Customers are far more selective,” said one Dubai supermarket operator. “They wait for the right deal before filling their trolleys.”
Global Pressures on Local Grocery Bills
The UAE’s reliance on imports plays a significant role in shelf prices. With around 80 per cent of its agricultural products sourced from abroad, the local market is exposed to global shipping costs, tariff adjustments, and currency fluctuations. This vulnerability shapes consumer perceptions about the root causes of high prices.
According to the Blue Yonder survey, 49 per cent of consumers blame tariffs for increased grocery costs, while 42 per cent point to rising raw material prices. In the Middle East, tariffs are considered the primary driver of price hikes, a view that influences how much shoppers trust retailers’ pricing strategies.
The New Reality for Household Budgets
To keep their grocery spending in check, many households are cutting back on non-essential purchases. The survey highlights that 56 per cent have reduced spending on clothing and footwear, 46 per cent on electronics, and 43 per cent on streaming subscriptions. This reallocation reflects a cautious mindset where essential goods are prioritised over discretionary items.
In response, retailers that offer consistent value, reliable stock, and transparent pricing are building stronger customer loyalty. Digital engagement has become crucial, with 79 per cent of UAE consumers stating they are more likely to shop with a retailer that offers personalised promotions. The online grocery market, valued at $3.4 billion in 2024, is also expanding rapidly as shoppers track deals across both physical stores and digital platforms.
To meet these new demands, grocers are focusing on price stability and trust. Many are tightening their supply chains, expanding their private-label offerings, and using AI-driven tools to forecast demand and reduce waste. While inflation may no longer be a headline issue, its lasting impact has created a market where value is the most important factor for consumers.
