Tesco arrests sales decline, but the discounters dominate growth over Easter

Tesco has continued on the road to recovery as it lessened its sales decline for the fourth consecutive month over the Easter period.

Britain’s biggest supermarket saw sales fall 0.2% year-on-year over the 12 weeks ending 27 March, according to Kantar Worldpanel. This continued the slowing rate of decline at Tesco after its overall sales fell by 0.8% – halving a previous decline of 1.6% – for the 12 weeks ending 28 February.

“A small increase in shopper numbers suggests Tesco could return to growth in the next few months; welcome news after 12 months in decline,” says Kantar Worldpanel’s head of retail Fraser McKevitt. “However, it is worth noting, that as it was partly hindered by previously announced store closures, Tesco’s market share fell by 0.3 percentage points to 28.1%.

Discounters dominate growth

Overall supermarket sales grew by 1.1% year-on-year over the Easter period. And it was Aldi and Lidl that once again dominated. The former grew sales by 14.4% to reach a record high market share of 6%. Lidl, meanwhile, increased sales by 17.7% and now controls 4.4% of the market.

Lidl’s UK CEO Ronny Gottschlich says the Kantar figures prove that the discounter has become the “supermarket of choice” over the Easter period. Lidl plans to grow its estate to 680 stores by the end of the year.

With almost 40 million customer transactions in the four weeks leading up to Easter, Lidl has become the supermarket of choice both for the regular shop and the most important meals of the year for an increasing number of British consumers,” boasts Gottschlich.

Mixed fortunes

Overall supermarket sales grew by 1.1% year-on-year over the Easter period. This is the fastest growth of the year so far.

In terms of the big four supermarkets, Sainsbury’s was the standout performer as it upped sales by 1.2%. It maintained its market share of 16.4% making it the only big four retailer not to lose market share.

In comparison, Asda saw its market share fall by 0.9 percentage points to 16.2% as it continued a disappointing run.

Morrisons, much like Tesco, is showing signs of recovery. In last month’s Kantar data its sales fell 3.2%. This month, however, sales fell by 2.4% as its market share fell just 0.4 percentage points to 10.5%.

The Co-operative secured its fastest growth since the Somerfield acquisition in 2011 upping sales by 3.9% as it increased market share by 0.1 percentage points to 6.1%.

Kantar Worldpanel says the convenience retail brand was boosted by keeping many of its shops open on Easter Sunday while many of the larger supermarkets closed stores.

McKevitt concluded: “An early Easter gave the market a sales boost of £152m compared to last year, adding 0.6% to the overall growth rate.  Britain’s love of all things sweet was in evidence, with 63% of households buying at least one chocolate egg during March, spending an average of £12 over the month.”

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