Sainsbury’s bullish despite drop in LFL sales

Mike Coupe:
Sainsbury's chief outlines future plans
  (Photo:  )

Sainsbury’s has seen a fall in like-for-like (LFL) sales, due to a “dynamic and fiercely competitive market”, according to the supermarket.

The major multiple announced a drop in LFLs of-2.8% excluding fuel, according to its trading statement for the 16 weeks to 27 September 2014.

Despite the challenging market conditions, Sainsbury’s chief executive Mike Coupe said he still valued its quality food and service, and pointed out the supermarket’s win at British Baker’s Baking Industry Awards, where it was crowned best in-store bakery of the year.

The retailer also said its convenience businesses had reached a growth of 17%, with annualised sales of £2bn. The company opened 23 new convenience stores and refurbished 10.

Coupe said: “In the second quarter, our performance has been impacted by the accelerated pace of change in the grocery market, including significant pricing activity and food price deflation in many areas.

“These conditions are likely to persist for the foreseeable future and we now expect our like-for-like sales in the second half of the year to be similar to the first half. We will provide a detailed strategic update at our Interim Results on 12 November 2014."

The retailer also announced it would be changing the way it priced items in store.

Coupe explained: “Customers tell us they find supermarket prices and promotions confusing. We have responded by lowering base prices on thousands of lines within the food business and simplifying Brand Match to make it clear that we match Asda’s prices on brands - even when they are on promotion.”

A pledge to deliver 750,000 square feet of new space was also made by Sainsbury’s, including the opening of two new convenience stores per week. 

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