20th Jun 2023 08:30
(Alliance News) - UK grocery price inflation eased to its lowest level since last year, numbers on Tuesday showed, though it remained in robust shape, helping boost the market share of discounters.
Like-for-like grocery inflation eased to 16.5% in the four-weeks to June 11, according to Kantar. For the full 12-week period of the survey, the inflation ebbed to 16.8%, from 17.1% in the 12-weeks to May 14.
"This is the lowest rate of grocery price inflation we've seen in 2023, which will be a relief to shoppers and retailers. But prices rising at 16.5% isn't something to celebrate and it's still the sixth-highest monthly figure in the past 15 years," Kantar analyst Fraser McKevitt commented.
"The ongoing squeeze is clearly weighing on the nation's mind. Of the top five financial worries that consumers have, rising grocery prices is the only one that they are more concerned about now than at the start of this year."
Total UK grocery sales in the 12 weeks jumped 9.9% on-year to GBP33.18 billion, from GBP30.19 billion.
Tesco PLC, the largest UK grocer by market share, saw an 8.9% year-on-year sales hike to GBP8.99 billion. However, its market share slipped to 27.1% from 27.3%.
J Sainsbury PLC recorded a 10% sales hike to GBP4.93 billion from GBP4.48 billion, though that only left its share of the market unmoved at 14.9%.
Asda sales also rose 10%, and its market share was similarly unchanged at 13.7%. Morrisons, once part of the 'big four' line-up of UK grocers, saw a 0.8% sales hike. Its market share dropped to 8.8% from 9.6%.
Online-only Ocado PLC saw a 2.5% sales hike to GBP549 million from GBP535 million. Its market share slipped to 1.7% from 1.8%.
Aldi, now the fourth-largest UK grocer by market share, thrived. The discount chain recorded a sales jump of 25% to GBP3.37 billion. Its market share rose markedly to 10.2% from 9.0%, the fastest-growing UK grocer during the 12 weeks.
Lidl sales jumped 23%, meanwhile, with its market share spiking to 7.7% from 6.9%.
It was once again a 12-week period when discount chains outperformed. And in another sign of thriftiness, the UK consumer is no longer vying for 'round-pound' price points.
"The proportion of products sold for GBP1, the single most popular price for a grocery item, has almost halved in a year from 9% to 5%. That's a big shift. Traditionally, 'round-pound' prices have been attractive to shoppers, who find them easier to relate to and practical as well with no leftover change," McKevitt added.
"But, with retailers eager to offer value and cash buying less popular, GBP1.25 has emerged as an increasingly important price point. It now vies with GBP2 as the second most popular price for a grocery item."
Shares in London-listed grocers fell on Tuesday morning. Tesco traded 0.7% lower at 257.00 pence, Sainsbury's fell 1.1% to 262.90p and Ocado dropped 3.6% to 419.40p.
By Eric Cunha, Alliance News news editor
Comments and questions to [email protected]
Copyright 2023 Alliance News Ltd. All Rights Reserved.
Related Shares:
TescoOcadoSainsbury's