Cheapflation is on the rise - the silent squeeze on budget food shopping

Whilst it might sound like another nonsense portmanteau, Cheapflation is real – and it’s quietly costing budget shoppers more.

January makes everyone ruthless; We’re tired, cold and trying to atone for the over indulgence and overspend of December, so we do what feels sensible: we head straight for the value range and hope for the best.

But here’s the problem, cheap doesn’t reliably mean good value anymore. In fact, it’s often where shoppers are being squeezed the hardest.

Research from the Institute for Fiscal Studies shows that between 2021 and 2023, prices for the cheapest grocery products rose much faster than mid-range or premium alternatives – roughly 36% compared with around 16%. That means people trading down have often faced the highest inflation. That’s cheapflation, and it’s not accidental.

What cheapflation actually looks like in real life

Cheapflation isn’t just about price. It shows up in subtler, more irritating ways:

• Shorter sell-by dates, meaning food spoils faster
• Cheaper ingredients that don’t stretch as far
• Products that need using in larger quantities
• Smaller pack sizes at the same headline price

That shorter shelf life is a big one. If your “cheap” cheese, bread or ready meal goes off sooner, you’re wasting food and potentially doing extra top-up shops. Both of which cost money. So while the value item might look cheaper at the till, it might cost more in the long run.

Why your shop feels worse, even if you’re spending the same

This is why people feel gaslit by their grocery bills. You’re spending roughly the same, but the food doesn’t last, doesn’t satisfy and doesn’t feel worth it.

Budgeting starts to feel like punishment, which usually ends in frustration spending by mid-month.

That’s not a willpower problem. It’s a product problem.

How to beat cheapflation without blowing the budget

Here are a few ways to beat cheapflation while sticking to your food shop budget.

Check the next brand up – it’s often the real sweet spot

The cheapest option feels virtuous, but it’s often a false economy. The jump from value to the next tier up is usually small – particularly if it’s on a multibuy, and you’ll often get better ingredients, better texture and crucially, longer sell-by dates. That extra day or two matters. Food that lasts longer gets eaten, not binned, and fewer emergency top-up shops means fewer impulse buys sneaking into your basket.

Budgeting isn’t about suffering –and it’s also about buying things that actually survive the week.

Treat the World Food aisle like a budgeting cheat code

If you’re not shopping the World Food aisle, you’re missing a trick when it comes to cupboard staples. Tinned tomatoes, rice, lentils, chickpeas, spices and sauces are often significantly cheaper here than in the main aisles, and the quality is usually better.

A decent spice shelf can turn one jumbo pack of mince into four completely different meals. It also brings a bit of sparkle to the flavour when you’re bulking dishes out with starchy vegetables.

Frozen food is your friend – and it’s not automatically lower quality

Frozen fruit, veg and proteins last for months, reduce waste and often beat fresh on price and nutrition. You can use exactly what you need, when you need it- and throwing a bonus handful of peas or spinach into a dish leaves you fuller for longer and scoressome points on your 5 a day.

A well-stocked freezer is one of the most powerful anti-cheapflation tools there is – especially in January, when energy is low and convenience spending is lurking.

Use loyalty schemes properly, not passively

Loyalty cards aren’t just about points anymore. Most supermarket apps now offer personalised discounts based on what they already know you buy, easily available in the app. That can feel a bit unsettling, but you might as well benefit. Check your offers beforeyou shop and switch on ‘push notifications’ to remind you if you’re likely to forget – the targeted money-off deals and bonus points really do add up over a month, especially on staples you were buying anyway.

Pay for your shopping in a smarter way

If you’re a thinkmoney Smart Plus customer, PlusSave^ gives you a quiet edge. You can get 3–4% off supermarket vouchers for Tesco, Iceland, Sainsbury’s, Morrisons, Asda and Farmfoods, which is effectively money off your shop before you even start filling the trolley. There’s also 5% off Deliveroo, which helps when you’re stuck in and still need essentials. It’s a quick an easy process to turn money into voucher spend, and you can do it at the checkout when you have a rough idea of your spend.

And if you’re not a Smart Plus customer (yet), it’s still worth checking your current account perks. Many now offer “activate to earn” cashback deals you toggle on once a month and then forget about, while small amounts quietly trickle back to you on everyday spending.

^Offers are subject to change and may vary. Check the thinkmoney app for the latest offers.

The bottom line

Cheapflation means the cheapest option isn’t always the thriftiest anymore – especially when shorter sell-by dates, weaker quality and faster replacement creep in.

Smart budgeting in 2026 isn’t just about buying the lowest price on the shelf. It’s about buying food that lasts long enough to actually be eaten.

January is hard enough. Your food shop shouldn’t be making it harder.