UK supermarket sales are projected to exceed £13bn in December for the first time, influenced by demand for premium products.
- Take-home sales rose by 2.5% for the four weeks to 1 December, driven by festive shopping behaviours.
- Spending on premium own-label goods has increased to 5%, with expectations to hit 7% by the month’s end.
- Monday, 23 December is anticipated as the busiest shopping day, as consumers prepare for Christmas celebrations.
- Despite steady grocery price inflation, the cost of Christmas dinner has climbed to £32.57, a 6.5% increase from last year.
December is set to be a record-breaking month for UK supermarket sales, expected to surpass £13bn. This impressive figure is largely attributed to a rising appetite for premium product lines as consumers prepare for the festive season. Notably, there has been a 2.5% rise in take-home sales over the four weeks leading to 1 December.
Consumers are increasingly investing in premium own-label items, with spending on such products currently at 5%, anticipated to reach nearly 7% by the end of the month. This trend reflects a shift towards quality selections as part of the festive preparations.
According to Fraser McKevitt, head of retail and consumer insight at Kantar, “Monday 23rd December is likely to be the single busiest day for supermarkets this year, although shoppers are already preparing for Christmas.” Notable increases in sales have been seen in festive staples, with sales of sweet biscuits and biscuits for cheese doubling in November. Additionally, 8% of consumers have already acquired a Christmas pudding.
The festive demand extends beyond grocery items, with significant growth anticipated in general merchandise sales during December. This follows a notable 21% increase in December 2023, compared to the yearly average. However, this seasonal spending comes amid a 6.5% rise in the cost of Christmas dinner, now averaging £32.57 for a family of four. Despite this, overall grocery price inflation has remained consistent at 2.6%.
Retailers have focused on maintaining lower prices, particularly through loyalty-based offers, contributing to a 14% increase in spending on price-cut offers. This shift in pricing strategy has seen multibuy deals remain stable, while lower-priced promotions have generated £355 million more than the previous year.
In the competitive landscape, Tesco has achieved its highest market share since December 2017, now at 28.1%, with sales growth of 5.2% over the 12 weeks to 1 December. Sainsbury’s has also increased its market share to 15.9% alongside a 4.7% rise in sales. Together, these two supermarkets now hold 44% of the UK market share.
Discount retailers like Lidl and Ocado continue to perform well, with Lidl’s sales up by 6.6%, and Ocado achieving an 8.7% increase, securing a 1.8% share of the market. Conversely, Asda has experienced a 3.5% decline in sales, indicating a challenging competitive environment.
December’s strong sales forecast signals a robust end to the year for UK supermarkets, despite rising festive costs.
