20th Oct 2015 09:32
LONDON (Alliance News) - J Sainsbury PLC was the only big four UK supermarket to increase sales in the past 12 weeks, for the third consecutive period, according to Kantar Worldpanel's grocery market survey published on Tuesday, as Tesco PLC, Wm Morrison Supermarkets PLC and Asda all posted declines in both sales and market share.
Sainsbury's sales rose 1.1% in the 12 weeks to October 11 to GBP3.96 billion from GBP3.92 billion in the same period a year earlier, boosted by a strong performance online and in its Local convenience stores. Its market share stayed flat at 16.1%.
Morrisons, meanwhile, saw an overall sales decline of 1.0% to GBP2.64 billion from GBP2.67 billion, as its market share slipped to 10.8% from 10.9%.
Tesco PLC's sales fell 1.7% to GBP6.89 billion from GBP7.01 billion, as its market share declined to 28.1% from 28.8%, with only Asda posting a weaker sales performance in the period. Asda, which is owned by US giant Wal-Mart Stores Inc, suffered a 3.0% decrease in sales to GBP4.08 billion from GBP4.20 billion. Its market share fell to 16.6% from 17.3%.
Meanwhile, German discounters Aldi and Lidl once again demonstrated strong growth as their combined market share grew to 9.9% from 8.5%. Aldi's sales rose 17.6%, while Lidl's sales increased 17.9%.
Waitrose, the upmarket supermarket owned by the John Lewis Partnership, also performed well, with sales rising 2.1% as its market share remained flat at 5.2%, while Iceland Foods Ltd and The Co-operative Group saw their sales grow 3.2% and 1.0%, respectively. Iceland's market share increased to 2.0% from 1.9%, and Co-op's market share remained flat at 6.4%.
The good performance from Waitrose came as Mark Price, its managing director and deputy chairman of the John Lewis Partnership, stepped down. Rob Collins, the retail director of Waitrose, will take over from Price when he steps down in April 2016.
Overall supermarket sales grew 0.8% year-on-year, the seventh consecutive month that sales among the grocers have grown by less than 1%, although online grocery sales increased 9.8%.
"With like-for-like grocery prices 1.7% lower than last year, the supermarket price war shows no signs of abating. Consumers have now enjoyed more than 12 months of continually falling prices and are currently pocketing these benefits rather than splashing out on substantially more grocery items, with overall volume growth of only 2%. This equates to GBP1.5 billion taken out of the market in the last year, saving each household GBP58 on average," Fraser McKevitt, head of retail and consumer insight at Kantar Worldpanel, said.
"Internet sales offer a chance of long term growth ? only 18% of households bought groceries online in the last 12 weeks meaning there's plenty of space for further expansion. The convenience factor and minimum spend restrictions mean online baskets tend to be larger, averaging GBP67 in value, compared with GBP14 for the average bricks and mortar trip. Amazon Fresh's expected full launch early next year could be a major disruptor, bringing down average basket sizes, accommodating on demand shopping, and accelerating the growth of the whole online market," he added.
UK grocery inflation now stands at negative 1.7% for the period, meaning shoppers are now paying less for a representative basket of groceries than they did in 2014. This is the same fall as reported last month, with lower prices reflecting the impact of discounters Aldi and Lidl as well as deflation in some major categories such as eggs, bread, butter and crisps, according to Kantar.
Shares in Sainsbury's were trading down 0.5% at 262.20 pence following the report Tuesday morning. Tesco shares were off 1.7% at 190.25p, while Morrisons shares were up 0.6% at 173.90p.
By Karolina Kaminska; [email protected] @KarolinaAllNews
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