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Supermarkets enjoy 17 months of consecutive growth

Sales rise 3.1 per cent at British retailers, but big fourís market share contracts at hands of smaller retailers

Supermarkets enjoy 17 months of consecutive growth

Morrisons was the fastest-growing big four supermarket

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Supermarket sales have increased for the 17th month running, rising by 3.1 per cent compared with last year, according to Kantar Worldpanel.

The analyst’s grocery market share figures for the 12 weeks to 8 October show that like-for-like grocery inflation remains at 3.2 per cent, but consumers could be welcoming a slowdown in price rises in the new year, with the rate projected to fall below two per cent in the first quarter of 2018.

It’s a mixed picture for the major retailers – each of the big four has grown sales but seen a decrease in market share as smaller operators continue to entice new customers through their doors. 

Fraser McKevitt, head of retail and consumer insight at Kantar Worldpanel, explained: “Morrisons was the fastest growing of the large supermarkets this period, increasing sales by 2.8 per cent. The biggest wins came from ambient and fresh food products, with cakes and pastries and fruit both up by 10 per cent.

“Growing sales at Morrisons’ bricks and mortar stores were supplemented by rapid expansion on its e-commerce platform, particularly in London and the south where online sales have risen 29 per cent.

“Despite the growth, however, the retailer’s overall market share fell by 0.1 percentage points to 10.3 per cent.”

Closely following Morrisons, the remaining big four have each continued to increase sales every month since April. At Tesco, sales grew by 2.1 per cent, though share was down 0.3 percentage points to 27.9 per cent.

Asda meanwhile has sustained its recent recovery, with sales up 1.8 per cent in the past 12 weeks. “Despite traditionally selling a higher proportion of brands than its major rivals it is own-label sales which are driving the growth at Asda,” McEvitt explained.

“They now account for 45 per cent of sales, with Asda’s value-focused Farm Stores line and premium Extra Special range leading the charge.”

Sales at Sainsbury’s increased 1.9 per cent on last year while market share now stands at 15.8 per cent, down 0.2 percentage points. Only 35 per cent of Sainsbury’s sales are now through price-cut deals, down sharply from nearly 40 per cent a year ago as part of the retailer’s ongoing programme of scaling back the overall level of promotions.

Aldi and Lidl, meanwhile, collectively added £390 million in sales this quarter, which accounts for half of the entire market’s overall growth this period.”

Lidl remains Britain’s fastest growing supermarket, up by 16 per cent, while Aldi grew by 13.4 per cent. Share increased for both retailers by 0.6 percentage points, up to 5.2 per cent of the market for Lidl and 6.8% for Aldi.

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