1st Mar 2022 09:17
(Alliance News) - UK supermarket sales fell by 3.7% in the 12 weeks to February 20 from a year ago, figures from Kantar showed on Tuesday, though sales remained 8.4% above pre-pandemic levels.
The fall in spending comes despite new highs in grocery pricing with inflation standing at 4.3% in February. This is the fastest rate of inflation recorded since September 2013, and with ongoing supply chain pressures and the potential impact of the conflict in Ukraine, customers may see prices continuing to rise.
Households spent on average GBP26.07 less at supermarkets in February and own label sales did better than brands for the first time in three months.
"It's important to flag that the drop in monthly spending isn't all down to savvy budgeting," noted Fraser McKevitt, head of retail & consumer insight at Kantar. "With the formal end to Covid restrictions in England, more of us are now eating on the go, buying sandwiches, salads and snacks on our lunch breaks, and enjoying meals out with friends and family. That means we're buying less food and drink to have at home."
Further evidence that shoppers are moving beyond the pandemic can be seen in online sales, down by almost 20% year-on-year over the past month.
Some 835,000 fewer people bought groceries online over the past four weeks compared to the record 6.6 million buyers seen last year. Digital sales now account for 13.3% of all spending, down 2.1 percentage points from last year.
Footfall also has fallen, impacted by extreme weather in the month. On February 18, for example, there was a 25% drop in footfall compared with the same day in 2021 as businesses and train links were shut across the country due to storm Eunice.
The majority of bricks and mortar retailers saw take-home grocery sales fall this period compared with last year, though all grew against 2020.
Aldi and Lidl were the fastest growing UK retailers during the period, both increasing their sales by 3.3%. Aldi attracted an additional 1.3 million customers compared with 2021, while Lidl brought in nearly an extra million.
Tesco PLC, with a 28% market share in February, saw sales drop 2.6% year-on-year to GBP8.62 billion in the 12 weeks to February 20. J Sainsbury PLC and Asda, the next biggest retailers in terms of market share, fell further.
Sainsbury's sales fell 4.1% annually to GBP4.82 billion and Asda's fell 5.5% to GBP4.53 billion. Wm Morrison Supermarkets was the worst performing retailer in February with sales dropping 8.2% to GBP3.05 billion.
Tesco shares were down 0.1% at 289.50 pence early Tuesday in London. Sainsbury's shares were down 0.4% at 274.69p.
By Heather Rydings; [email protected]
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