Asda regains second place spot despite “sluggish” grocery market growth

SALES declines at Yorkshire-based supermarkets Morrisons and Asda are down to “sluggish” growth of the British grocery market according to the latest figures from Kantar Worldpanel.

Overall the market saw an increase in sales of 0.9% compared to a year ago, but Asda has seen a 2.5% fall in sales and 0.6 percentage point fall in market share.

Despite this, the Leeds-headquartered supermarket has retaken its position as the UK’s second largest supermarket.

Morrisons’ increased decline of 1.1% this month reflects a tougher comparison against last year, when a widespread voucher promotion was in place.

Fraser McKevitt, head of retail and consumer insight at Kantar Worldpanel, said: “As anticipated, Asda has retaken its position as Britain’s second largest supermarket, despite a fall in sales of 2.5% and a 0.6 percentage point fall in market share.
“The retailer’s greater focus on non-food items means its market share is traditionally higher in the summer, and it’s expected that Sainsbury’s will again become the number two retailer towards Christmas.

“Industry growth of around or below 1% has now persisted since summer 2014 and has become the new normal. Despite the accelerating British economy like-for like grocery prices are still falling, with a representative basket of everyday items now 1.7% cheaper than in 2014.”

Iceland is attracting more shoppers through store openings and changing the image of frozen food to a ‘premium’ level, and sales are up by 3.4% as a result, and retailer Waitrose has had another successful period, with growth of 3.7%. For the second month in a row there is also growth at the Co-operative, with sales at the till up by 1.1% compared to last year.

Fraser McKevitt continued: “It’s been another successful period for the discounters, with growth at Aldi accelerating to 18.0%. Lidl’s sales have also risen, up 12.8%, taking its market share to a new high of 4.1%.

Sainsbury’s is the only one of the ‘big four’ retailers to have seen an increase in sales, which are up by 0.1%, its first growth since March.

Sales at Tesco fell by 0.9% despite growth in the convenience stores, and the retailer now holds 28.3% of the market.

 

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