(Reuters) -Cheerios cereal maker General Mills ( GIS ) posted a bigger-than-expected drop in quarterly sales on Wednesday, as cash-strapped consumers cut back on its higher-margin products and turned to cheaper alternatives.

Shares of the Minnesota-based company were down about 4% before the bell.

The company has struggled with lower volumes and retailers cutting down on inventory while also facing ongoing competition from lower-priced private labels that have been eroding its market share.

However, benefits from price hikes in previous quarters were eclipsed by pressures from raw materials costs like sugar and labor.

The company's quarterly net sales fell to $4.71 billion from $5.03 billion a year ago. Analysts, on average, had expected sales of $4.85 billion, according to LSEG data.