Fourth of July parties will cost almost $100 to host this year as consumers seek value
06/29/2024 21:44
Americans are eager to find deals as the cost of just about everything is up compared to last year.
Americans are still eager to spend on barbecues this Fourth of July, even if their wallets are a little stretched.
When it comes to the holidays, consumers "typically are willing to spend," Katie Thomas, lead at the Kearney Consumer Institute, told Yahoo Finance, noting that mediocre consumer sentiment is unlikely to weigh on food sales.
Overall, Americans are expecting to spend a whopping $9.4 billion on food alone this July Fourth, according to the National Retail Federation.
Those hosting cookouts can expect to spend a little more. A barbecue index from Rabobank Group showed that a 10-person barbecue this year will cost Americans roughly $99, the most on record, with key fixings such as beer, beef, soda, and lettuce making up nearly two-thirds of the overall cost.
The holiday does offer an opportunity to save. July Fourth is the most popular day for barbecuing at home. That's "really advantageous" for consumers, according to Wells Fargo chief agricultural economist Michael Swanson, as food away from home drove overall food inflation higher again last month.
In May, grocery prices were up 1% year over year, while the cost to dine out jumped 4% year over year. Both were in line with trends in recent months.
Wells Fargo reported that grilling hamburgers at home for a party of 10 will save hosts nearly $50 compared to dining out, not including taxes and tips. To break it down further, the average cost of a hamburger with all the fixings, cheese, lettuce, and tomatoes is $2.15 at home versus $6.95 at a restaurant.
The cost of a barbecue in 2024
Sticker shock will still be present at the register.
Ground beef costs $5.33 per pound this year, up 4.9% over last year, which is "unfortunately building on an increase from the previous year," Swanson said.
Two other popular proteins, frankfurters and chicken, saw prices jump 7.3% and 1.4%, respectively, year over year.
As for toppings, the price of lettuce increased by 1%, tomato prices are up 3.9%, and condiments rose 2%. But cheese prices are down 3.4% from last year.
On the side, chips are up 2.7% year over year, according to Bureau of Labor Statistics mid-June data that Wells Fargo reported. Guacamole may be the go-to dip this year: It's down 1.1%, whereas salsa prices are up 2.5%.
For those with a sweet tooth, it'll cost you. Increased sweetener costs are driving ice cream prices 3.3% higher, per Swanson.
As far as drinks go, consumers are better off getting 2-liter bottles than cans to save, as aluminum has gotten more expensive. The bill for 2-ounce cans is up 4.8%, while the cost of 2-liter bottles is down 6.5% from a year ago.
And if you're looking to have a toast with some alcoholic beverages, prepare to spend a bit more. Beer is up 1.2%, per Wells Fargo, while wine is up 3.4%.
Savvy consumers will be looking for deals
There are still deals to be had, and consumers are scouting stores for the best price, McCormick (MKC) CEO Brendan Foley told Yahoo Finance Executive Editor Brian Sozzi.
"The consumer is definitely showing a lot and exhibiting a lot of value-seeking behavior," Foley said, noting that shoppers are first searching the perimeter of stores to find the deals before heading into the aisles. "They're being really more selective on price points, and we definitely see that throughout the store."
Similar to the value competition in fast food, grocery stores have been ramping up their deals to cater to value-seeking Americans.
Walmart (WMT) is doubling down on advertising its low-cost everyday model. Target (TGT) announced plans to cut prices on 5,000 consumer staples like milk, meat, bread, soda, fresh fruit, and vegetables. And Aldi shared its plans to lower prices on 250 items through Labor Day.
Private-label brands, as well as wholesale retailers like Costco (COST), Walmart's Sam's Club, and BJ's (BJ), could be winners in this value-oriented environment.
"You'll just see the consumer be savvy," Thomas said. "They're going to price shop. They're going to figure out what they can buy in bulk." She added that consumers are "not so caught up in whether or not it's private label. Frankly, it's quality for the price."
Private-label goods could be a key way to save, Swanson advised, especially for items that guests won't recognize once they come out of the packaging.
"Once you put the chips in the bowl, people really don't know whether they came in a private label package or in a branded package," Swanson said. However, "if you're keeping beverages in the cooler, when they pick up the can, they definitely see what was the brand."
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Brooke DiPalma is a senior reporter for Yahoo Finance. Follow her on Twitter at @BrookeDiPalma or email her at [email protected].