Talking Retail Grocery and product news for independent retailers
Tesco said like-for-like sales at its UK stores rose by 5.3%. Its chief executive Ken Murphy admitted that the volume of goods sold was marginally lower than the same period last year. But he said the UK consumer “has proved quite resilient”.
The retailer said it had seen “strong” Christmas trading as it offered more deals to fend off competition from discount rivals Aldi and Lidl and the growth included “particular strength” in fresh food, with 8.1% growth, as shoppers continued to spend on essentials.
The group also highlighted a 7.4% increase in sales by volume of its low everyday prices range after launching a “price lock” commitment on these products in October.
Sainsbury’s, the UK’s second-biggest supermarket, reported a sales rise of 7.1% in the six weeks to 7 January compared with the same period in 2021 helped by 50% more people visiting its Argos outlets in supermarkets.
Simon Roberts, the chief executive of Sainsbury’s, said customers shopped carefully but “really wanted to have a good time” over Christmas – switching to own-label products and frozen goods, and shopping around for the best deals to keep within budget.
Marks & Spencer saw like-for-like sales grow by 7.2% in the UK in the six weeks to 7 January. Food purchases rose 10.2%, just behind the official inflation figures, with strong turkey sales and more than a fifth of shoppers purchasing items from its ‘Remarkable Value’ range.
Improved availability of products, following supply chain issues of the previous year, is also said to be a factor.
Commenting on M&S’ trading update, Julie Palmer, partner at professional services consultancy Begbies Traynor, said: “Marks & Spencer had a pretty good Christmas which will reassure boss Stuart Machin. The food business outperformed the market and delivered a record performance.
“The pressures on British retailers aren’t going anywhere so the high-street veteran is taking action to structurally reduce costs, but one has to question if price increases are around the corner.
“While the typical M&S shopper tends to be wealthier, so is less hard hit by rising costs, they could still choose to economise. The cost of living crisis is hitting everyone and well-known supermarket-discounters no longer carry the stigma they once did, so we may still see customers trading down to lessen the cost-burden if times get even tougher.”
That could be, to some extent, occurring already as Lidl also saw a boost in its British sales over Christmas which it attributed to a surge in shoppers switching from rivals in search of cheaper options amid the cost of living crunch.
