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Grocery sales volumes rise by 18-month high
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Grocery sales volumes rise by 18-month high

The volume of groceries sold at the UK’s leading supermarkets rose by its highest year-on-year rate for 18 months.

Shoppers bought +0.8%¹ more groceries during the four weeks ending 24 February compared to the same period last year. The last time year-on-year volumes rose by more – excluding seasonality-affected periods – was +1.4%¹ in August 2016.

Whilst the growth in volume improved on recent times, the increasing amount shoppers spent fell back slightly as inflation started to peak. Year-on-year sales increased at the supermarkets by 1.8%¹, or 2.9% including the discounters. The corresponding figures in the previous four-week period were 2.7%¹ and 4.2%, respectively.

In contrast to non-food retailers, which are seeing weaker consumer demand than a year ago, grocery retailing continues to look positive. Much of the credit goes to the grocery retailers who’ve displayed a great balancing act at not passing on too much of the increased supply chain costs to the end shopper. As a result, consumers in general don’t feel the need to hold back on grocery shopping.

This confidence was illustrated by the fact that the amount of spend going on products with temporary price cuts or multi-buy offers remained relatively low at 27% of all sales going through the tills. This is a sign that supermarkets don’t need to go overboard on using promotions to encourage shoppers to spend. In fact, many of February’s promotions across the top four supermarkets, Waitrose and M&S focused more on ‘big nights in’, offering customers attractive, but cheaper, alternatives to dining out.

Over the twelve weeks ending 24 February, Tesco had the most improved year-on-year performance among the top four supermarkets (sales up 3.1%), followed by Asda (2.9%). Overall, Iceland (up 3.8%) had the best growth figures outside of the discounters.

The good news continues for the Big Four: Tesco and Asda are still attracting more shoppers, Morrisons growth was good – even against a good performance last year – and whilst Sainsbury has the lowest growth, visits and spend per visit are increasing.

Looking ahead, it suggests that the strategy of the major supermarkets to target improving like-for-like sales, being less reliant on new stores for growth and reducing operating costs to help invest in lower prices, could be the green shoots of a sustainable recovery.

NOTES
All figures are from Nielsen Homescan Total Till unless otherwise stated.
¹Nielsen Scantrack