06December2024

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The Rise of Discounters Continues in the UK Retail Market

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Michelle Butler, London Office Manager, Bord Bia – Irish Food Board

The latest Kantar Worldpanel grocery share figures, announcing a combined record share of 10% for discounters Aldi and Lidl, will continue to put pressure on the already squeezed middle. While the German discounters take share and continue to post double digit growth, those occupying the middle ground, namely Asda, Tesco and Morrisons, show no signs of improving their performance.

In January this year Tesco CEO Dave Lewis announced a plan to remove up to a third of products off its shelves in an attempt to cut costs and make the weekly shop simpler. This strategy has not yet stemmed the decline in sales, with Tesco sales down 2.5% in the latest 12 weeks. Sainsbury’s regained its position as the second largest retailer from Asda in the latest 12 weeks. Asda was the worst performing retailer with sales down 3.5%. The release of these latest figures saw Asda’s CEO Andy Clarke announce an even more aggressive stance on pricing. In a statement he said Asda was focused on reducing the price gap on the discounters to just 5% from its current 10%, whilst also improving its product range and customer service. Similar to Tesco, he also announced plans to implement a 10% reduction in its product range.

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Waitrose is continuing its strong performance against a declining market, and as we enter the festive period this upward trend in sales is likely to continue, with consumers trading up over this period. The Co-operative’s focus on convenience and investment in new store fit outs is starting to bear fruit as they post their first year on year share gain since 2011.

For more information please contact michelle.butler@bordbia.ie.

Source: Bord Bia - The Rise of Discounters Continues in the UK Retail Market