Supermarket sales experience fastest growth of the year

Latest figures from Kantar Worldpanel have shown that supermarket sales have increased 1.1% compared to the same period for last year. 

The data, for the 12 weeks ending 27 March 2016, represents the fastest growth in the sector this year.

“An early Easter gave the market a sales boost of £152 million compared to last year, adding 0.6% to the overall growth rate,” said Fraser McKevitt, head of retail consumer insight at Kantar.

“Britain’s love of all things sweet was in evidence, with 63% of households buying at least one chocolate egg during March, spending an average of £12 over the month. Over half of the population bought hot cross buns, while 15% purchased a fresh leg of lamb for their Easter celebrations.”

Sector leader Tesco had reason to celebrate after its decline lessened for the fourth month in a row, with sales now down 0.2% year-on-year. “A small increase in shopper numbers suggests Tesco could return to growth in the next few months; welcome news after 12 months in decline. Partly hindered by previously announced store closures, Tesco’s market share fell by 0.3% points to 28.1%,” commented McKevitt.

Meanwhile, The Co-operative saw sales increase by 3.9%, its fastest growth since the Somerfield acquisition in 2011. This equates to a market share of 6.1%, a rise of 0.1%. Many of its shops remained open during Easter Sunday, which helped boost sales.

Although Sainsbury’s announced in February that it was scaling back multi-buy promotions, this hasn’t had a damaging impact on its performance, with a sales increase of 1.2%.

Discounter Lidl retained its place as the fastest-growing supermarket, increasing sales by 17.7% to hold 4.4% of the market. Elsewhere, Aldi grew sales by 14.4% to reach a new market share of 6%.

Falling prices

Furthermore, research conducted by shopping and comparison website found that the cost of groceries has dropped for the fourth month in a row.

The cost of a basket consisting of 35 popular products has dropped to £84.36, the lowest recorded price since mySupermarket Groceries Tracker began on December 2014.

“While saving money on the basics, consumers are not averse to treating themselves,” explained McKevitt.

“Premium own-label sales grew by 6.6% in the past 12 weeks, well ahead of the overall grocery market. Aldi and Lidl are leading the way, growing their premium lines more than twice as quickly as the rest of their ranges, but we’ve seen this across the retail spectrum – from Morrisons and The Co-operative to the likes of Waitrose, whose forthcoming launch of Waitrose 1 is the latest attempt by a traditional grocer to reclaim sales from the discounters.”

Tesco also recently launched seven sub-brands to go up against the discounters.

Although items such as broccoli, bananas and onions dropped in price, deli bacon and ham rose in price by 3%.

“One thing for certain is that you need to ensure you are getting the best possible price for your shop,” advised Kim Ludlow, managing director of mySupermarket.

“While prices continue to drop, there are several key products that are rising, or fluctuating month to month. It’s easy to feel overwhelmed by prices and promotions in-store. By comparing prices before you leave and writing a list – and sticking to it – you’ll be much better off.”

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