23.8% Is Not the Number That Should Worry National Brands at Walmart

Store brands just claimed a record share of American shopping carts, and the trade press has covered the milestone thoroughly. But the figure getting the headlines is not the one that should concern national brand teams most. Buried in the same Circana data is a disconnect between units and dollars that describes a strategy problem, not a share problem, and it is a problem that surfaces at Walmart before it surfaces anywhere else.

Over the six months ending June 14, store brand unit sales rose 0.2% while national brand units declined 0.5%, according to Circana data released July 8 through the Private Label Manufacturers Association. That 0.7 point spread pushed store brands to a 23.8% unit market share, an all-time high, and store brands have now beaten national brands on unit sales performance in five of Circana’s six monthly reporting periods this year. The breadth matters as much as the record: across the 52 weeks ending June 14, 52% of the 166 food categories where store brands compete posted private label unit growth. Among the departments Circana tracks across the store, pet care led at 4.8%, followed by beverages at 1.8% and refrigerated at 1.5%.

The disconnect sits in the dollar columns. Store brand dollar sales were flat for the period while national brands grew dollars 2.2%, holding private label to a 21.2% dollar share. National brands, in aggregate, are still growing revenue. They are doing it by pricing up while volume walks out the door. PLMA president Peggy Davies attributed part of the gap to divergent national brand pricing, with some brands cutting price to win back defectors while others raise price to cover fuel, ingredient, and input costs. Numerator’s Consumer Goods Price Index puts a finer point on the environment those increases are landing in: everyday prices rose 0.70% in June after gains of 0.51% in May and 0.44% in April, a third straight month of acceleration that leaves prices up 3.4% year over year, the fastest annual pace in nearly three years. Walmart itself sees more cost pressure ahead. On the company’s May 21 earnings call, chief financial officer John David Rainey told investors that if elevated costs persist, shoppers should expect retail prices to climb at a faster clip through the second quarter and the rest of the year.

Dollars Impress the CFO. Units Decide the Mod.

Revenue growth on declining units can look sustainable in a brand’s own P&L for a surprisingly long time. It looks very different inside a line review, where unit velocity is the currency that decides facings, distribution, and whether an item survives the next mod reset. A national brand walking into a Walmart category review with 2.2% dollar growth and negative units is not presenting a growth story. It is presenting a shrinking shopper base that has so far been willing to pay more, and the Circana data suggests the willingness is thinning. The supplier-side implication is direct: teams that have been defending rate at the expense of velocity should treat the second half as the window to rebalance, through price-pack architecture, opening price points, or Walmart-specific pack sizes, before the velocity gap starts making the argument for them.

The Shopper Doing the Switching Is Not Coming Back on Her Own

Survey findings Zappi shared through the same PLMA release describe how fast the loyalty floor is dropping. Shoppers who say they buy only national brands fell from 21% to 10% in under a year, and more than 90% report changing how they shop because of rising costs. Nearly 70% would accept fewer options in exchange for lower prices. Zappi chief marketing officer Natali Kelly framed the stakes plainly: “The era of growth driven by price increases is coming to an end.” For suppliers, the 70% figure deserves particular attention, because it undercuts the assumption that assortment breadth is a defense. A shopper who will trade variety for price is a shopper for whom a four-flavor lineup at a premium is losing to one flavor at a rollback.

Walmart’s Own Numbers Tell a Stranger Story

Here is where the national data and Walmart’s data appear to collide. In the quarter ended April 30, a period that sits entirely inside the PLMA measurement window, Walmart’s overall private brand penetration declined about 40 basis points, Rainey disclosed on the May earnings call. Food penetration fell a little more than 100 basis points while general merchandise penetration rose almost 200. That looks, on the surface, like Walmart running against the national tide.

The explanation resolves the contradiction and reinforces the larger point. Rainey attributed the food decline largely to eggs, a major private brand item whose price deflated sharply during the quarter, and said penetration would likely have continued climbing without that effect. In other words, Walmart’s food dip is a price artifact, the same dollars-versus-units distortion running through the national numbers, where flat private label dollars concealed a unit share record. Measured in what shoppers actually put in carts, the direction of travel is one way. And the general merchandise figure deserves more attention than it has received: a nearly 200 basis point penetration gain means private brand pressure is now arriving in the aisles where national brands and sellers had assumed the fight was mostly a grocery problem.

The Record Was Set Against Great Value’s Old Packaging

The timing detail that should reset how Walmart suppliers read the 23.8% figure is this: the record was achieved before Walmart’s private brand investment reaches the shelf in force. Walmart announced the first full redesign of Great Value in more than a decade on April 15, spanning nearly 10,000 food and consumable items, with a phased rollout over two years that begins with salty snacks. The measurement period for the record closed June 14, weeks into a rollout that has barely started. Whatever share private label took in the first half, it took with the old look, and the announced two-year cadence means the competitive floor rises category by category from here. Pricing pressure is compounding from the same direction: Rainey told investors on the same call that roughly 7,200 rollbacks were live across the assortment, up more than 20% from a year earlier, and the company followed with its July 6 announcement of summer price cuts across grocery and household categories. Each rollback narrows the gap a national brand’s premium has to justify.

The implications split by segment. For 1P suppliers, this lands squarely in second-half planning: the categories earliest in the Great Value redesign sequence, starting with salty snacks, are the categories where the unit-versus-dollar tradeoff will get tested soonest, and where exclusive innovation and sharper pack architecture are worth funding first. For 3P Marketplace sellers, the calculus just changed in a way the grocery-centric coverage misses. Marketplace assortment skews toward general merchandise, which is exactly where Walmart’s private brand penetration grew almost 200 basis points last quarter, so sellers in home, seasonal, and hardlines categories should expect to compete against a strengthening first-party private brand shelf, not just other sellers. The offsetting opportunity is real: the trade-down shopper Zappi describes rewards focused assortments and credible value framing, and sellers positioned as the affordable alternative within a category stand to inherit demand national brands are shedding.

The ceiling on this trend sits well above 23.8%. PLMA has noted that store brands account for roughly a quarter of sales in markets like Spain and approach half in the United Kingdom and Switzerland, a comparison the association drew at its annual conference. American private label penetration is not approaching a natural limit. It is closing a gap with markets that show how much further the number can run, which is the context in which a record should be read less as a milestone and more as a mile marker.

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