Strong sales of fruit and vegetables gave the UK grocery market a health kick in January as it returned to growth after a difficult Christmas.
Sales rose 0.2% in the 12 weeks to 31 January, compared with a 0.2% fall in the three months to 3 January, despite continued price cuts, according to the latest industry data from Kantar Worldpanel. Fresh fruit and vegetable sales rose by about 5% while fish, poultry and nuts saw similar growth.
Fraser McKevitt, head of retail and consumer insight at Kantar, said: “Consumers are clearly striving for a healthier start to the year and have turned to fresh foods.”
Discounters Aldi and Lidl, both of which have been flagging deals on fresh fruit and vegetables in recent weeks, were the main beneficiaries. They accelerated growth slightly to 13.7% and 18.7%, increasing their market share by 0.7 percentage points each to 5.6% and 4.2%.
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Their influence, as well as commodity deflation, underpinned a 1.6% year-on-year fall in grocery prices – a slight improvement on the 1.8% seen over Christmas.
For the first time since 2011, the Co-op was the fastest growing traditional grocer with a 1.4% rise in sales. The chain is benefiting as shoppers switch towards visiting smaller local stores, rather than one big shop at an out-of-town supermarket, as well as its own efforts to improve its service.
Asda’s difficulties continued with sales slumping by 3.8%, worse than the 3.5% fall revealed by Kantar for the previous period, and by far the worst performer in the market. The pressure is ramping up on Asda boss Andy Clarke, who next week will reveal the chain’s sales performance for the quarter covering Christmas. It has lost 0.7 percentage points of market share since last year to 16.2%, putting it well behind Sainsbury’s 16.8%.
Sainsbury’s was the only one of the main “big four” supermarkets to achieve sales growth – with sales up 0.6% over the three month period. But Tesco and Morrisons both managed to slow sales declines, in good news for the turnaround hopes of their chief executives Dave Lewis and David Potts. Tesco’s sales slid by 1.6% compared with 2.7% last time while Morrisons’ sales were down 2.2% compared with 2.6% before.
