General Mills Cuts Prices Up to 20% on Cereals After Flat US Sales
General Mills cut prices up to 20% on key cereal and snack brands after US packaged-food sales were flat in January, marking nine months of center-store stagnation. The move to boost double-digit promotional spending may support volume but risks compressing General Mills’ gross margin as deflation intensifies.
1. Price Cuts Initiative
General Mills trimmed prices by up to 20% on core cereal and snack lines, including Nature Valley granola bars and Chex cereals, deploying deeper discounts and coupons to reignite consumer demand.
2. Stagnant US Packaged-Food Sales
US packaged-food sales remained flat in January, extending nine months of center-store sales stagnation as households trade down and promotional activity intensifies across the grocery sector.
3. Margin and Volume Outlook
The surge in promotional spending—expected to grow in double digits—should help recover volume but is forecast to erode General Mills’ gross margin as deflationary pressures persist.