Philips said “people were being very frugal” but he expected this to play to Morrison’s strengths, as it continues to outperform it rivals as the fastest-growing of the big four supermarket groups.
“We have a very strong Christmas programme, and we intend to win it,” he said, as supermarkets prepare to lure cash-strapped shoppers during the vital trading period.
The UK’s fourth largest grocer said sales at stores open over a year rose 2.4 per cent in the 13 weeks to 30 October, excluding fuel and VAT, driven by its focus on fresh foods and low prices, beating forecasts.
Philips said consumers were becoming “more professional” in their approach to shopping, spending less on credit cards, checking prices in store and knowing the exact price of their products.
The sales of its ready meals jumped by more than 60 per cent after it relaunched its own brand ranges under the M Kitchen label, helped by more people eating in.
“A third of our customers have no disposable income left at the end of a month,” Philips said, which had led the group to cut the price of single items and launch special promotions towards the end of each month.