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Supermarket sales growth almost halts ahead of general election

Edmund Heaphy
·Finance and news reporter
Customers shop at a Sainsbury's store in London, Britain December 3, 2015. Britons will spend 20.3 billion pounds ($31 billion) on groceries over the festive period, a 1.4 percent increase on last year, industry research group IGD forecast on Wednesday. The group said its research found 19 percent of shoppers plan to spend more on food and drink over the Christmas period, defined as Nov. 20 to Dec. 26, than the previous Christmas, a trend which could be positive for the likes of market leaders Tesco and Sainsbury. REUTERS/Neil Hall
Customers at a Sainsbury's store in London. Photo: Reuters/Neil Hall

Supermarket sales growth slowed to just 0.5% in the past twelve weeks, as shoppers postponed Christmas preparations amid poor weather and general election uncertainty.

Customers made one fewer visits to supermarkets compared to this time last year, while Black Friday provided only a limited boost to supermarkets.

“Amid the uncertainty of a general election, a lacklustre Black Friday and a wet autumn, shoppers have been delaying their Christmas preparations and are waiting to stock up on festive supplies,” research firm Kantar said on Tuesday.

The slowing of growth compared to the same period last year came as shoppers flocked to German discount retailers.

Growth of 9.3% in the past 12 weeks at Lidl sent the chain’s market share to a new record high of 6.1%, while Aldi’s year-on-year growth of 6.2% brought its market share to 8%.

Sales fell at Tesco (TSCO.L) by 0.8%, at Sainsbury’s (SBRY.L) by 1.1%, and at Asda by 1.9%. Of the traditional chains, Co-op continued to buck the trend and achieved growth of 3.6% in the past twelve weeks compared to last year.

“We’re yet to see consumers ramp up their spending in the run up to Christmas and, as anticipated, Black Friday only brought a limited boost for the grocers,” said Fraser McKevitt, the head of retail and consumer insight at Kantar.

He noted that shoppers were waiting to fill their cupboards ahead of the general election, noting that sales of Christmas puddings and seasonal biscuits were down 16% and 12% in the past four weeks compared to 2018.

“While the big four all lost share in the past 12 weeks, 98% of the British public still visited at least one of their stores during the past three months,” said McKevitt.

Meanwhile, online juggernaut Ocado (OCDO.L) continued to be the fastest-growing supermarket, with sales climbing 13.7% compared to last year.

Its market share in London climbed to 2.6%, almost double its 1.4% level nationally.