The latest grocery market analysis shows Tesco and Sainsbury’s leading the retail sector as inflation eases.
- Food price inflation decreases by 2.2%, settling at 12.7% in the period ending 6 August 2023.
- Tesco’s and Sainsbury’s sales grew by 9.5% and 9.3%, respectively, bolstering their market presence.
- Aldi remains the fastest-growing grocery retailer with a 21.2% sales increase, achieving a 10.2% market share.
- Overall grocery sales rose by 6.5%, marking a decrease from the previous month’s growth rate.
According to recent data published by retail analyst Kantar, both Tesco and Sainsbury’s have performed exceptionally well in the grocery market during the past month. With grocery price inflation falling by 2.2% to 12.7% in the four weeks leading up to the 6th of August 2023, these two major retailers have capitalized on the easing inflation to enhance their sales figures. Tesco achieved a 9.5% increase in sales, resulting in a slight market share increase to 27.0%, up from 26.9% a year earlier. Meanwhile, Sainsbury’s sales increased by 9.3%, maintaining a stable market share of 14.8%.
Aldi has continued its impressive growth trajectory, being the fastest-growing retailer for the fourth consecutive month. The retailer recorded a remarkable 21.2% surge in sales compared to the previous year, which elevated its market share to 10.2%. Despite the growth of these leading retailers, the overall take-home grocery sales experienced a decline in growth, with a rise of 6.5%, which is lower compared to last month’s 10.4% increase.
Fraser McKevitt, Head of Retail and Consumer Insight at Kantar, provided insightful comments on the recent trends: “The latest slowdown in price rises is the second sharpest monthly fall since we started monitoring grocery inflation in this way back in 2008.” He noted that while prices remain elevated year-on-year, consumers are likely to feel some relief as staple goods begin to decrease in price. For instance, the cost of four pints of milk decreased to £1.50 from £1.69 in March, and the average price of a litre of sunflower oil dropped by 22 pence from the spring.
However, the effects of the current economic climate extend beyond pricing. Cooler temperatures and increased rainfall appear to have discouraged shopping trips, as noted by McKevitt. Foot traffic to stores decreased for the first time in 18 months, with 320,000 fewer visits compared to the same period a year ago. This downturn in footfall could be contributing to the reduced overall growth in grocery sales.
Despite the slowdown in inflation, the grocery market faces challenges from consumer behaviour shifts and environmental impacts on shopping patterns.
