Supermarket war continues as market reaches low

Grocery inflation low
Inflation decrease means food costs are the same as last year
  (Photo:  )

Competition within supermarkets has driven down grocery inflation to zero. 

The latest figures from Kantar Worldpanel, published for the 12 weeks ending 14 September, also show a record low for grocery market growth of 0.3%.

Kantar said this was a reflection of the impact of Aldi and Lidl, the market’s competitive response, as well as deflation in some major categories including bread.

Aldi has continued to see double-digit growth, with a year-on-year sales increase of 29.1%. Meanwhile, Tesco shows little sign of recovery, as sales remain down by 4.5%, leaving it a market share of 28.8%.

Fraser McKevitt, head of retail and consumer insight at Kantar Worldpanel, said: “Consumers are currently benefiting from intense price competition between the grocers. For the first time ever we’ve seen the average basket of everyday goods bought today costing exactly the same as it did a year ago. 

“With some staple groceries, such as vegetables, milk and bread, prices are actually falling as the big retailers all compete for a bigger slice of shoppers’ wallets.”

Asda has recorded the best results among the big four supermarkets this period and is the only one to increase its market share, now at 17.4%. It has also seen an increase in sales, up 0.8% compared to last year.

Grocery inflation has seen its 12th successive fall and now stands at zero for the same 12-week period. 

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