Deli numbers have seen tremendous change over the past year, with deli inflation starting to cool.

Amid widespread unit and volume pressure in departments and categories across the entire grocery store, the deli prepared aisle is largely holding its own. With shoppers favoring more just-in-time shopping, immediately consumable foods take on a new importance to the store, said Jonna Parker, team lead Fresh with Circana (formerly IRI). Deli-prepared foods generated $1.9 billion July and improved unit sales above year-ago levels.

This is in sharp contrast to deli meat that dropped 3.4% in units (packages sold) year-over-year. In the full-year view, the patterns are similar, with the deli-prepared section outperforming deli cheese, meat and entertaining.  

Deli meat sales (combined fixed and random weight) totaled $668 million in the four July weeks, virtually unchanged in dollars compared to July 2022, but down substantially in pounds. Over the past few years, the share of deli meat generated by the service counter has dropped in favor of growing shares for grab-and-go and pre-sliced. This trend can also be seen in July 2023, with grab-and-go dollar sales up 4.8% versus service deli meat being down 1.8%.

Packaged lunchmeat (included in meat department sales) reached $517 million in July 2023. After many months of substantial, but inflation-driven, dollar gains, July became the second month in which sales dipped below year-ago levels. Packaged lunchmeat saw pounds drop 6.2% versus year ago in July versus a decline of 3.4% for deli meat. 

Deli entertaining

“Sales during the Independence Day week totaled $103 million versus $92 million in a typical week,” Parker said.

The week saw strong sales for all things spreads, trays, charcuterie meats and pickles/relish (including olives) sales. Other popular board items, whether charcuterie, butter or hummus boards, all experienced above-average sales during the holiday week as well. The holiday week was not quite able to offset the declines in the three remaining weeks, but flat year-on-year pound sales in July was a far better performance than the 52-week drop of 1.8%.  

Deli prepared

“Price plays an oversized role in today’s market,” Parker said. “However, it is just part of the story. The ultimate value is the combination of price with elements such as convenience, health, taste and experience, and that’s where grocery deli prepared plays very strongly.”

Summer typically sees less at-home meal preparation and July was a very big month for deli prepared with unit gains for the seven biggest sellers. Winners include prepared meats and pizza, illustrating that deli-prepared foods can serve as one of the ingredients of a meal or replace the entire home-cooked or restaurant meal.