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Retail

Kantar Worldpanel: Growth Slows At UK Supermarkets

By Steve Wynne-Jones
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Kantar Worldpanel: Growth Slows At UK Supermarkets

The latest supermarket share figures from Kantar Worldpanel for the UK market have indicated a slowdown in growth at all the major supermarket groups. Supermarket sales for the 12 weeks ending 24 April 2016 increased by just 0.1% compared to the same period last year.

“Consumers are enjoying a golden period of cheaper groceries with like-for-like prices falling every month since September 2014," said Fraser McKevitt, head of retail and consumer insight at Kantar Worldpanel.

"Nearly two years of falling prices mean the average household is spending £78.10 a week in the supermarket, so consumers have annually saved more than £400 than if prices had risen at the same rate as the last decade."

In terms of the main groups' performances, Morrisons is still feeling the impact of having less store space than last year – this period sales were down by 2.6%. Sales were also down at Tesco, by 1.3%, and at Asda, which now commands a 16% share of the market thanks to a sales fall of 5.1%.

“Sainsbury’s was the best performing, though sales fell back by 0.4% – the first time the retailer has dipped into decline since July last year, though it retained its 16.5% share of the market," said McKevitt. "This marks the first time that each of the big four has simultaneously witnessed a drop in sales since April 2015.”

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Commenting on the figures, Clive Black of Shore Capital said that he expects "future financial progress by the quoted majors in FY2017 and beyond. That progress will be more about small steps rather than leaps but we reiterate the importance of volume growth, which is the basis for positive operational gearing and negative working capital to come through.

"That gearing will be the driver of margin re-expansion to our minds alongside stronger free cash generation, strengthening balance sheets and a more positive outlook for dividends."

© 2016 European Supermarket Magazine – your source for the latest retail news. Article by Stephen Wynne-Jones. To subscribe to ESM: The European Supermarket Magazine, click here.

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