Supermarket Wars: Aldi Overtakes Waitrose

Aldi has overtaken Waitrose in terms of market share for the first time in the UK to become the country's sixth largest supermarket chain, according to the latest industry figures.

Statistics published by Kantar Worldpanel for the 12 weeks ending 29 March showed hard discounters continued to eat into the sales dominance of the big four chains - Tesco (Xetra: 852647 - news) , Asda, Sainsbury's and Morrisons.

While upmarket Waitrose grew sales by 2.9% compared to a year earlier, Aldi's sales were found to have soared.

News of the German firm's progress emerged as Aldi confirmed it was to quadruple its number of stores in London this year, creating 600 new jobs.

Fraser McKevitt, head of retail and consumer insight at Kantar, said: "Aldi has recorded double-digit sales growth for the past four years and is now Britain’s sixth largest supermarket with 5.3% of the market.

"Growth has been fuelled by over half a million new shoppers choosing to visit Aldi this year and average basket sizes increasing by 7%.

"The German discounter’s sales have increased by 16.8% in the latest period, still high compared to other retailers but slower relative to its recent performance."

Waitrose had a market share of 5.1%, Kantar said.

There was also some cheer for the big four, which have been slashing costs and prices in a bid to protect their own market shares.

Sainsbury's returned to growth in the 12 week period for the first time since August 2014.

Its market share fell just 0.1% to 16.4% while Tesco also grew sales, up 0.3%, while Asda and Morrisons declined by 1.1% and 0.7% respectively.

Kantar said shoppers were continuing to benefit from falling prices.

Grocery inflation saw its 19th successive fall to stand at an annual rate of -2.0% - a new record low .

Falling shop prices, a result of the intense competition and other market forces including weaker oil and other commodity costs, are expected to imminently result in the UK's inflation rate turning negative.