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Marks & Spencer outpaces Aldi and Lidl as turnaround gathers pace

Marks & Spencer bakery employee
Price cuts have boosted recent Marks & Spencer food sales - Hollie Adams/Bloomberg

Marks & Spencer’s grocery sales are growing faster than Aldi and Lidl as a turnaround led by chief Stuart Machin gains traction.

Industry figures reveal that M&S was the fastest growing traditional grocer over the last 12 weeks, with the total take at its tills rising by 11.9pc compared to a year earlier.

That compared to growth of 6pc at Aldi and 10.4pc at Lidl, according to market research company NIQ.

Only Ocado’s sales rose faster, rising 12.2pc on the prior year.

The NIQ Total Till figures are based on sales increases at each retailer, which can be affected by higher prices. However, Mike Watkins, NIQ’s UK head of retailer and business insight, said both M&S and Ocado had gained “more new shoppers than other retailers - including Aldi and Lidl” and sold more products overall.

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Events including Valentine’s Day and Pancake Day provided a boost for M&S thanks to its dine-in meal deals, he added.

The figures are the latest sign that Mr Machin’s turnaround efforts at M&S are yielding results.

Sales and profits have been rising across the group and the department store returned to the FTSE 100 last summer after a four-year absence.

Mr Machin said in January that his stores were winning shoppers from competitors including Waitrose, which is a key rival for the middle classes.

The M&S chief added: “I think it’s fair to say we think we can gain share from the broader food market overall. We’re not focused on just one competitor.”

A record number of customers bought groceries from M&S over the Christmas period, boosted by a spate of recent price cuts.

The NIQ figures also laid bare the pressures on Morrisons and Asda, which are both losing market share.

Asda’s market share dipped from 12.5pc this time last year to 12pc despite a 2pc rise in sales. Morrisons’s market share slipped to 8pc from 8.2pc, even as sales rose by 3.6pc.

Both supermarkets were taken over in debt-fuelled deals in recent years.

Rising interest rates have put more pressure on the businesses as interest costs have increased sharply. Morrisons is owned by CD&R, while Asda is co-owned by the billionaire Issa brothers and TDR Capital.

Morrisons recently began matching its prices to Aldi and Lidl in an effort to win back customers who had drifted away to the German discounters.