Supermarket price war forecast to keep going

The supermarket price war shows no signs of abating according to analysts Kantar Worldpanel, whose latest figures show households with a year-on-year saving of £58 on average, a fact which means £1.5 billion has been taken out of the market in the last year.

“Consumers have now enjoyed more than 12 months of continually falling prices and are currently pocketing these benefits rather than splashing out on substantially more grocery items,” said Kantar’s head of retail and consumer insight, Fraser McKevitt, pointing out that overall volume growth in the last year was “only 2%”.

Kantar’s latest grocery share figures for the 12 weeks to October 11, 2015, show overall supermarket sales growth up by just 0.8% compared to a year ago. In addition, despite a more buoyant overall economy, supermarket revenue growth has not reached above 1% since March 2015.

“Sainsbury’s was the only one of the larger supermarkets to see sales growth during this period, with a strong performance in its online and local stores helping it to increase revenues by 1.1%,” said the company, adding that sales fell by 1.7% at Tesco, by 3% at Asda and by 1% at Morrisons.

Discounters, Lidl and Aldi, are continuing to do well, however.

“For the second successive month Lidl has reached a new share high, now claiming 4.3% of the market and growth accelerating to 17.9%,” said Mr McKevitt (pictured above). “Growth was particularly strong in Scotland, the scene of its ‘smarter shopping’ card trial.

“It’s a similar story for Aldi, where revenues are up 17.6% on a year ago.”

Footnote: Lidl was also given high praise today by the National Pig Association for becoming the latest retailer to source 100% British fresh pork. The 100% list, according to the latest Porkwatch figures, now consists of Lidl, Aldi, Budgens, Co-op, M&S, Morrisons, Sainsbury’s and Waitrose.

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