Sainsbury's issued a 1.1 per cent fall in like-for-like sales this morning, and analysts' reactions have been pretty scathing.
The retailer boosted its volumes, but the supermarket price war has eroded any benefit Sainsbury's might have wanted to see in its like-for-likes as a result.
Sainsbury's share price has dropped 3.67 per cent today following the announcement.
28 September 2016 @ 11:45amSainsbury (J) (SBRY)
In the next 12 months Asda will also start to regain its footing, and Aldi are in fighting talk, standing by their pledge to be the lowest-priced grocer. Quite simply, Sainsbury's footfall is falling short."
“For two years, Sainsbury’s defied the economic gravity of Britain’s supermarket shoot-out. No longer," said John Ibbotson, director of the retail consultancy Retail Vision.
“The brand has come down to earth with a bump, with like-for-like sales slumping for the second quarter in a row. Only the rudderless Asda is losing sales at a faster rate."
Laith Khalaf, senior analyst at Hargreaves Lansdown said:
Food deflation continues to bite hard on the supermarkets in an extremely competitive environment. Sainsbury’s is getting more items passing through the checkouts but the price of those goods is still falling, and the net effect is still falling sales in pounds and pence.
"It completes a pretty tough six months for the company, which seems to have been affected most by food price deflation. Transactions were up, which only serves to highlight the issue of margin compression in the sector," said Neil Wilson, markets analyst at ETX Capital. "Market share seems pretty steady."