The annual inflation of grocery prices in the United Kingdom decreased to 12.2% in the four weeks ending on September 3, down from 12.7% a month earlier, according to research by Kantar released on Tuesday.
During the same period, the sales of groceries increased by 7.4% compared to the previous year, up from 6.5% a month ago.
“The inflation of grocery prices has dropped for the sixth consecutive month, but 12.2% is not a cause for celebration for many households. Our data shows that 95% of consumers are still concerned about the consequences of rising grocery prices, second only to their concerns about energy bills,” said Fraser McKevitt, Head of Retail & Consumer Insight at Kantar.
Particularly, Wilko’s market share in non-food items such as toiletries and household goods is 0.5 percentage points higher than in July, as consumers took advantage of Wilko’s decline, according to Kantar.
The price inflation of groceries over the longer 12-week period ending on September 3 was 13.0%, a decrease from 14.4% in the 12 weeks ending on August 6. Prices rose most for eggs, confectionery, and frozen potato products.
During that period, the revenue of the largest British supermarket, Tesco, increased by 9.3% from GBP 8.11 billion on a yearly basis to GBP 8.86 billion, increasing its market share from 26.9% to 27.2%.
Sainsbury’s revenue increased by 9.1% from GBP 4.42 billion to GBP 4.82 billion, increasing its market share from 14.6% to 14.8%.
Asda’s revenue increased by 5.1% from GBP 4.27 billion to GBP 4.49 billion, although its market share decreased from 14.1% to 13.8%.
The largest increases came, as in previous months, from the two German discounters Aldi and Lidl, the only supermarkets with double-digit percentage year-on-year revenue growth.
Aldi’s shares increased by 17% from GBP 2.80 billion to GBP 3.28 billion, with a market share of 10.1%, up from 9.3%.
Lidl’s shares increased by 16% from GBP 2.13 billion to GBP 2.47 billion, and its market share increased from 7.1% to 7.6%.
Regarding Aldi and Lidl, McKevitt said, “We expect these performances to continue as inflation remains persistently high, but the growth rates for both discounters have slowed in recent months as they calculate against the rapid increases seen last year.”
Between Aldi and Lidl in terms of market share is Morrisons, with a 2.0% increase in revenue from GBP 2.74 billion to GBP 2.80 billion, but a decrease in market share from 9.1% to 8.6%.
Co-Op’s revenue increased by 2.5% from GBP 1.95 billion to GBP 2.00 billion, but its market share shrank from 6.5% to 6.1%.
Waitrose saw revenue increase by 5.6% from GBP 1.41 billion to GBP 1.49 billion. However, its market share decreased from 4.7% to 4.6%.
Iceland’s revenue increased by 4.3% from GBP 718 million to GBP 749 million, while its market share decreased from 2.4% to 2.3%.
Ocado’s revenue also increased by 4.3% from GBP 515 million to GBP 537 million, while its market share decreased from 1.7% to 1.6%.
McKevitt said, “One of the big stories of late is the rise in sales of own-label products, which dominate the shelves of Aldi and Lidl. Sales increased by 9.9% again last month, and own-labels now make up more than half of everything we buy, up from 48% in August 2013. This equates to a shift in sales of GBP 3 billion away from brands. The discounter model of offering everyday low prices and fewer promotions has also taken hold in the broader market, with only 26% of spending now going on deals, compared to 38% a decade ago.”
Tesco’s shares were up 0.7% at 261.50 pence in early London trading on Tuesday. Sainsbury’s shares were 0.5% higher at 270.40 pence. Ocado’s was up 0.2% at 810.00p, while M&S was down 0.2% at 220.10p.