Sainsbury’s and Aldi signal continued pressure on prices

Sainsbury’s suffered a 1.1% decline in like-for-like sales in the 16 weeks to September 24, highlighting continued food price deflation as a major factor behind the fall.

“We continue to make progress against our strategy,” said the supermarket’s chief executive, Mike Coupe, pointing out that the company had made a further investment in everyday low prices and was continuing to improve the quality of its products.

Nevertheless, he added that he expected the market to remain competitive, with the effect of the current devaluation of sterling remaining unclear.

“However, Sainsbury’s is well positioned to navigate the changing marketplace and we are confident that our strategy will enable us to continue to outperform our major peers,” he said.

The Sainsbury’s figures come on the back of a trading report from the discount supermarket Aldi which revealed a 1.8% decline in operating profits despite achieving record sales in the UK and Ireland in 2015.

That will result in “continued investment in prices” according to Aldi chief executive, Matthew Barnes.

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