(qlmbusinessnews.com via news.sky.com– Tue, 9 Jan 2018) London, Uk – –
Figures show squeezed consumers spent more on groceries but there was a sharp decline for non-food retailers.
Tesco was named the best major supermarket performer in the run-up to Christmas as shoppers splashed out an extra £1bn across the sector, according to new figures.
Industry data from Kantar Worldpanel showed sales at Tesco rose by 3.1% in the 12 weeks to 31 December, well ahead of “big four” rivals Sainsbury’s, Asda and Morrisons at about 2% each.
But separate numbers from the British Retail Consortium (BRC) highlighted the starkly different picture for non-food stores, which saw their worst fall since 2009.
Squeezed households have had to manage their budgets over a period when grocery inflation climbed to 3.7%, according to the Kantar data.
Fast-growing discounters Aldi and Lidl were the biggest winners over the period, with sales up at each by 16.8%.
Overall sales for the sector rose 3.8% to £28.9bn compared to last year.
Tesco – which will report its own figures later this week – was boosted by the performance of its own label products as well as last-minute Sunday purchases at its convenience store network on Christmas Eve.
Kantar said that, across the grocery retailers, households shrugged off economic worries to spend an average £1,054 over the period.
It said shoppers continued to trade up to more expensive products, with a record £469m spent on premium own label lines such as chilled items, bakery goods and fresh meat in December alone.
Mince pie sales rose 13.2% to £93m while alcohol was up 5.1% to £3.9bn.
Fraser McKevitt, head of retail and consumer insight at Kantar Worldpanel, said: “Overall supermarket sales increased in value by 3.8%, with an additional £1bn ringing through the tills compared to the same festive period last year.
“Shoppers parted with £747m on 22 December alone, making the Friday before Christmas the busiest shopping day ever recorded.”
The report came on the same day as Morrisons delivered its own better-than-expected trading update, and a day ahead of figures from Sansbury’s.
Figures from the BRC also out on Tuesday showed UK retailers saw a 0.6% like-for-like sales rise in December but the report highlighted how the “severe pressure” on spending was weighing heavily on some firms much more than others.
It said that for the three months to December, food sales were up 2.6% but non-food sales saw their worst decline since March 2009 – at the height of the financial crisis – with a fall of 1.9%.
BRC chief executive Helen Dickinson said: “The divergence between growth in sales of food and non-food has never been so stark.
“With inflation outpacing income growth, shoppers continued to see more of their spending power absorbed by essential items, including food, leaving less left over for buying Christmas gifts.
By John-Paul Ford Rojas