British Grocery Sales Slide for Three Consecutive Months, First Such Dip in 20 Years: Study

Latest industry data published this week shows that the grocery market in Britain has, for the first time in the last 20 years, witnessed three consecutive months of decline in sales. With the impending Christmas season, this only adds to the pressure being experienced by the league of four major players in the UK consumer goods market.

The data was published by Kantar Worldpanel. Grocery sales in the UK dipped 0.2% YoY, reaching GBP 24.88 billion. The figures relate to the first 12 weeks up to November 9, 2014. Since Kantar started recording market figures in 1994, this is the first decline in this market.

With a mounting price war, two emerging players in the grocery market – Aldi and Lidl – have earned healthy growth rates as compared to the bigger players despite having relatively smaller shares in the market. The report stated that while Aldi’s sales increased by 25.5%, Lidl saw a rise of 16.8%.

These two discounters have been fast eating into the shares of the big four – Tesco, Asda, Sainsbury and Morrison. While all four players are trying to compete by slashing prices, thus far it is only Asda that has been successful in reducing the flow of customers to the emerging discounters.

According to a senior official at Kantar Worldpanel, the price wars have benefited customers, who now pay up to 0.4% less for an average purchase of daily essentials such as milk, vegetables and bread, as compared to last year at the same time. The report forecasts that this price deflation would likely continue into 2015.


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