I read through a book some friends gave me about traveling to Iceland (Cheap Iceland: How to Travel This Expensive Country on a Tight Budget) and several times it mentioned the store BÓNUS. It’s a discount store, sort of like ALDI. That book was great, but that guy sounded like he had no money. He provided some nice tips, though.
There was one right near the first hotel so I had to go check it out. Helps that I love going to grocery stores, too. Pretty traditional grocery store stock, of course with some local food. Prices weren’t too bad; I was expecting stuff to be very high. We did pick up stuff to use during the week instead of needing to eat out for every meal because I read via the book that it was expensive to do so.