Tesco sees early signs of changing shopper behaviour
Tesco saw its group retail sales edge up 2% to £13.57 billion in the 13 weeks to 28 May, although sales in the UK fell following “early signs” of changing customer behaviour due to the cost of living crisis.
Sales were up 1.5% year-on-year in the UK and Ireland combined, while revenue in the region increased by 9.7% compared to pre-pandemic levels three years ago. However, sales in the UK edged down 1.5% after the supermarket’s year-on-year performance was impacted by annualisation of lockdown last year, particularly in general merchandise, clothing and online.
Meanwhile, sales in Tesco’s central Europe business rose by 9% following continued market share growth.
Ken Murphy, Tesco chief executive, said: “Whilst the market environment remains incredibly challenging, our laser focus on value, as well as the daily dedication and hard work of our colleagues, has helped us to outperform the market. Our material and ongoing investment in the powerful combination of Aldi Price Match, Low Everyday Prices and Clubcard Prices is removing the need for customers to shop elsewhere.”
Tesco said its Booker wholesale business put in a strong performance with retail like-for-likes rising by 2.3%.
Looking ahead, Murphy said: “Although difficult to separate from the significant impact of lapping last year’s lockdowns, we are seeing some early indications of changing customer behaviour as a result of the inflationary environment. Customers are facing unprecedented increases in the cost of living and it is therefore even more important that we work with our supplier partners to mitigate as much inflation as possible.”
