Big four grocers all lose ground to discounters

 
Kasmira Jefford
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BRITAIN’S four biggest supermarket groups all lost market share over the last three months to German discounters Aldi and Lidl, with Sainsbury’s suffering the biggest drop in market share in ten years.

Sainsbury’s has until this month been the only one of the big four to resist the pressure of the discounters and hold onto its market share.

But data released yesterday from market researcher Kantar Worldpanel showed that its market share has slipped to 16.5 per cent in the 12 weeks to 30 March, down from 16.9 per cent in the same period last year.

The grocer’s sales declined by 1.7 per cent year-on-year, a dramatic slowdown on the 2.2 per cent rise recorded in the 12 weeks to 2 March.

“These numbers will raise questions as to whether Sainsbury’s is participating sufficiently in recent price investments to maintain its competitiveness,” Deutsche Bank analysts said yesterday.

Morrisons, Asda and Tesco have all pledged to invest in slashing prices to respond to rising competition from Aldi and Lidl, which have continued to grow their market share.

Aldi’s sales leapt 35.3 per cent year-on-year in the 12 weeks to March 30 – its highest ever growth rate – boosting the discounter to a record market share of 4.6 per cent.

Lidl’s sales rose 17.2 per cent, taking its share to 3.4 per cent. Meanwhile upmarket grocer Waitrose held onto its market share of five per cent, with sales growing 4.5 per cent.

Asda proved the most resilient of the big four with a sales fall of 0.5 per cent, while Morrisons, which issued a profit warning last month, was the worst performer with a decline of 3.8 per cent.

Tesco’s sales fell three per cent, dragging its market shares down by 1.1 percentage points to 28.7 per cent.

Kantar said that the weak performance was accentuated by the later timing of Easter this year, with the overall grocery market growing at 0.6 per cent compared with around 1.5 per cent if Easter had fallen in the period.