Grocery market accelerates as Tesco returns to sales growth
The UK grocery market grew at its fastest rate since June 2014 in the 12 weeks to 1 February with growth of 1.1%.
The latest grocery share figures from Kantar Worldpanel show that Tesco returned to growth for the first time since January 2014 with sales increasing by 0.3% year-on-year in the period. Despite the increase, Tesco’s overall market share fell to 29%, down by 0.2 percentage points compared to last year.
Meanwhile, Asda reclaimed the title of second largest retailer in the period with 16.9% of the market, thereby overtaking Sainsbury’s with its 16.7% share. Both supermarkets saw sales fall compared with a year ago – Asda by 1.7% and Sainsbury’s by 1%. Morrisons’ sales fell by 0.4% which was its best performance since December 2013. Its market share was 11.1% in the period.
Fraser McKevitt, head of retail and consumer insight at Kantar Worldpanel, said: “Shoppers are taking advantage of both lower fuel prices and the continuing price war among the supermarkets to slightly increase their grocery spending. This has pushed the market into 1.1% growth, low by historical standards but a considerable improvement compared to November 2014, when the market contracted.
“All of the major grocers have continued to compete fiercely on price leading to like-for-like grocery prices falling by 1.2%. This is another record low, saving Britain’s shoppers £327 million over the past 12 weeks.”
Discounter Aldi saw sales growth of 21.2% compared to growth of 36% at its peak in April 2014. Meanwhile, Lidl increased its sales by 14.2% compared to its maximum growth of 24% in May last year. Despite the slowdown, the discounters increased their market shares to 4.9% and 3.5% respectively.
At the premium end of the market, Waitrose saw a sales rise of 7.2%, taking its overall share to 5.2%.
