Retail update June 2013: Discounters and Waitrose continue to shine

The four weeks ending 22 June saw mixed fortunes for the leading supermarkets in the UK with the majority of sales growth coming from the discounters and Waitrose, according to latest figures released by Nielsen. . Aggregate sales value growth during the four weeks ending 22 June 2013 was +2.3% year-on-year. For the previous four-week period (ending 25 May 2013), year-on-year sales value growth was up +2.8%. Unit sales (volume) increased +0.1% year-on-year, compared to +0.2% year-on-year during the previous four weeks. Explaining the figures, Nielsen’s UK head of retailer and business insight Mike Watkins said: “With real household incomes still under pressure and consumers shopping around for the best deals, supermarkets have maintained in-store promotions and the percentage of spend on offer remained broadly unchanged. Some retailers are also investing considerably in fuel savings or money-off vouchers as a way of differentiating from the competition.” Meanwhile, the Nielsen figures showed that the strongest category growth was in the heavily promoted category of Confectionery (+8.0% value year-on-year), seasonally-driven Produce (+7.6%) and Fresh Meat (+4.4%). However, growth in General Merchandise (-0.1%) and Beers, Wines and Spirits (-0.1%) weakened, while the “engine room” of supermarket growth, Packaged Grocery (+1.4%) and Household (-1.4%) also failed to keep pace with inflation. Among the 10 leading UK supermarkets, Aldi saw the greatest increase in sales in the 12 weeks ending June 22 (+24.3% value year-on-year) followed by Waitrose (+8.4%). Iceland (+4.4%) and Lidl (+3.4%) also both outperformed overall sector growth. Sainsbury’s had the highest year-on-year sales value growth (+2.3%) amongst the top five supermarkets but still somewhat below that of the other five. Consequently, all the top five, except Sainsbury’s, lost market share compared to the corresponding twelve weeks last year. Commenting on retailer performance, Watkins noted: “Sainsbury had another strong period, being the only one of the top four to outperform the market in terms of sales growths. The improved sales momentum continued at Morrisons during the four week period with new selling areas coming on stream. Tesco looks to have stabilised sales, whilst Asda’s performance was set against a very strong period last year. However, the top four sales growths were somewhat lower than that of the discounters, Waitrose and M&S. “With shopper disloyalty a factor in any four week period, the timing of advertising and promotional activity is key. So with no major ‘event’ to advertise around, growth has been more dependent on regular, monthly shopping trips. Consequently, Aldi have outperformed the market significantly due to a 9% increase in spend by shoppers per visit.”   Source: NamNews - Thursday 4th July 2013