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Lidl overtakes Waitrose to become UK’s seventh largest supermarket

| International retailers

Latest grocery market share figures from Kantar Worldpanel for the 12 weeks ending 13 August 2017 show Lidl has increased its market share to a record high of 5.2% – up 0.7 percentage points year-on-year and overtaking Waitrose to become the UK’s seventh largest grocer.

Fraser McKevitt, head of retailer and consumer insight at Kantar Worldpanel, commented: “Ten million households visited the retailer’s expanding network of stores during the past 12 weeks, with alcohol and fresh produce performing particularly well as the retailer increased sales by 18.9% overall.  Lidl is growing sales 40% faster with families than with households without children.  Families tend to buy more items each time they shop, so strong growth with this demographic has helped Lidl to increase its average basket size year-on-year.  Not far behind, Aldi grew sales by 17.2%, attracting 1.1 million more shoppers through its doors than this time last year and increasing market share by 0.8 percentage points to stand at 7.0%.”

Meanwhile, overall supermarket sales grew by 4.0% year-on-year, despite the disappointing weather hitting demand for summer favourites such as ice cream and burgers. Growth was again driven by grocery price inflation which increased to 3.3% on a like-for-like basis after holding steady at 3.2% for the past two months.  Kantar Worldpanel said that prices are rising fastest in markets such as butter, fish and cola with all major categories now registering inflation.

The largest retailers in the sector continued their sales recovery with all the big four grocers growing for the fifth consecutive period, a run of collective success not seen since 2013.  However, this period of sustained growth wasn’t enough to entirely offset pressure from the discounters: the big four now account for just 69.3% of the UK grocery market – down from 76.3% five years ago – with McKevitt stating that this trend is likely to continue in the coming months.

At Tesco, overall sales grew by 3.0%, helped by an increase in volume sales, but its market share fell to 27.8% – down 0.3 percentage points compared to last year.  Morrisons increased sales by 2.6% – the ninth consecutive period of growth for the chain – while market share dropped slightly to stand at 10.4%.  Kantar Worldpanel said Morrisons’ online business is performing particularly well: the retailer continues to increase its share of the online grocery market, attracting more shoppers as it expands its delivery service to new parts of the UK.  Meanwhile, Sainsbury’s sales rose by 2.0% as the grocer’s market share fell to 15.8% – down 0.3 percentage points year on year.

Asda managed to continue its run of positive sales performance which began in April this year – up 1.4% during the latest quarter.  This follows the retailer’s recent announcement of a return to like-for-like sales growth, suggesting Asda is asserting its recovery across the board.  McKevitt said that own label has been important to the grocer’s turnaround, providing a boost from both ends of the price spectrum: the value ‘Farm Stores’ and premium ‘Extra Special’ lines both saw double-digit growth during the period.

Waitrose’s market share held steady at 5.1% as it managed to increase sales by 2.8% year-on-year, continuing the unbroken run of growth the grocer has enjoyed since March 2009.  Sales of branded goods were up 7% year-on-year at Waitrose – particularly noteworthy at a time when many retailers are focusing more on their own label lines.

After more than two years in growth, the Co-op’s sales declined by 0.4% as its market share fell to 6.3% – down 0.3 percentage points compared to this time last year.  This dip is partly attributable to the retailer’s sale of nearly 300 of its stores to convenience chain McColl’s.  Meanwhile, Ocado increased sales by 12.6%, now holding 1.4% of the overall grocery market.

 

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