Tesco and Sainsbury’s have outperformed their competitors as grocery inflation slows down.
- Inflation for groceries has decreased significantly by 2.2%, now standing at 12.7%.
- Tesco and Sainsbury’s saw sales boosts of 9.5% and 9.3% respectively over recent months.
- Aldi continues to be the fastest growing retailer, marking a 21.2% increase in sales.
- Despite these gains, cooler weather has resulted in reduced supermarket visits.
Tesco and Sainsbury’s have excelled in the retail sector as the rate of grocery inflation has reduced by 2.2% over the four weeks leading up to 6 August 2023, bringing it down to 12.7%. This performance is supported by data from Kantar, a retail analyst, indicating a robust growth trajectory for the UK’s largest retailers.
The sales growth for Tesco and Sainsbury’s has been notable, with both retailers recording increases of 9.5% and 9.3% respectively over the past twelve weeks. Tesco’s market share has incrementally increased to 27.0%, compared to 26.9% the previous year, while Sainsbury’s has maintained stability at 14.8%.
Aldi has distinguished itself as the fastest growing retailer for the fourth consecutive month, with a dramatic increase in sales by 21.2% from 2022, resulting in a market share of 10.2%.
Overall, take-home grocery sales rose by 6.5% over the same timeframe, although this represents a decrease from last month’s 10.4% increase. Fraser McKevitt, Kantar’s head of retail and consumer insight, remarked that this reduction in price increases marks one of the sharpest monthly drops since 2008. He noted, ‘Prices are still up year on year across every supermarket shelf, but consumers will have been relieved to see the cost of some staple goods starting to edge down compared with earlier in 2023.’
McKevitt highlighted how certain essential items have become more affordable; for instance, the price of four pints of milk decreased to £1.50 last month from £1.69 in March, and the average cost of a litre of sunflower oil has dropped by 22 pence since spring.
Despite these promising figures, the market faced challenges due to unfavourable weather conditions, with cooler temperatures and increased rainfall deterring shoppers. As a result, the data reflects a decline in footfall for the first time in eighteen months, with 320,000 fewer trips to physical supermarkets recorded compared to the previous year.
These developments suggest a positive shift in the grocery retail sector amidst changing economic conditions.
