Grocery market picks up pace

Supermarkets
Grocery market picks up
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The grocery market is growing at its fastest rate since June last year at 1.1%. 

The figure from Kantar Worldpanel, for the 12 weeks ending 1 February, have been credited to shoppers taking advantage of lower fuel prices, as well as the continuing price war among the supermarkets to increase their grocery spend. The major grocers have continued to “compete fiercely”, said Kantar, leading to like-for-like grocery prices falling by 1.2% - another record low.

Fraser McKevitt, head of retail and consumer insight at Kantar Worldpanel, said: “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.

“Tesco returned to growth for the first time since January 2014, increasing sales by 0.3% compared to this time last year. Britain’s largest retailer is bouncing back from a tough year, with Dave Lewis’ efforts to overhaul the supermarket attracting an additional 236,000 shoppers into its stores in the past 12 weeks. Despite the increase in sales, Tesco’s overall market share fell to 29%, down by 0.2 percentage points compared to last year.”

Asda reclaimed the title of second-largest retailer in this period with 16.9% of the market, overtaking Sainsbury’s, which usually performs most strongly at Christmas. Both grocers saw sales fall compared with a year ago – Asda by 1.7% and Sainsbury’s by 1% – while Morrisons’ sales fell by 0.4%, its best performance since December 2013.

At the premium end, Waitrose saw a sales rise of 7.2%, taking its overall share to 5.2%.

McKevitt said that discounters Aldi and Lidl would find their rapid growth levels difficult to match in 2015. “Aldi’s growth of 21.2% is still impressive, but a relative slowing from its 36% peak in April 2014,” he said. “Likewise, Lidl’s maximum growth of 24% in May last year is now down to 14.2%. Despite this slowdown, both retailers are still taking share from the other retailers – rising 0.8 percentage points and 0.4 percentage points respectively to 4.9% and 3.5%.”

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