Aldi has become UK’s fifth largest grocer, says Kantar

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Aldi has become the UK’s fifth largest grocer, with sales up 12.4 per cent year on year, according to Kantar Worldpanel.

The latest grocery market share figures from Kantar, which are published today for the 12 weeks ending January 29 2017, show that Aldi increased its market share by 0.6 percentage points to clinch fifth place for the first time.

The new Aldi store in Guiseley .  2 February 2017.  Picture Bruce Rollinson

The new Aldi store in Guiseley . 2 February 2017. Picture Bruce Rollinson

Fraser McKevitt, head of retail and consumer insight at Kantar Worldpanel, said: “Just a decade ago Aldi was the UK’s tenth largest food retailer, accounting for less than 2 per cent of the grocery market. Since then the grocer has grown rapidly, climbing the rankings by an impressive five places to hold a 6.2 per cent market share.

“Underpinned by an extensive programme of store openings, the past quarter has seen Aldi attract 826,000 more shoppers than during the same period last year.

“Despite being overtaken by Aldi, Co-op’s 2 per cent sales increase was well ahead of the market, continuing a run of growth stretching back to July 2015. A significant own label sales increase of 7 per cent was behind the strong performance, with healthier ranges successfully catering to consumers’ good intentions for the new year.

“Not all shoppers were convinced by the health message though: while overall sales of healthy own label lines increased by 3 per cent, a dry January was certainly not on the cards for many of us – sales of beer increased by 4 per cent over the past 12 weeks, with wine up by 1 per cent over the same period.”

The market continues to grow faster than it did in 2016, with supermarket sales up 1.7 per cent on last year: eight of the nine major retailers saw positive sales growth during the past 12 weeks.

Although not significant enough to dampen the market, well-publicised supply issues over the past few weeks have affected sales in fresh produce, Kantar said.

Mr McKevitt said: “Eleven million households buy courgettes annually, but supply issues contributed to 759,000 fewer shoppers buying them this January – that’s a 31 per cent drop in spending compared with the same month last year. Sales of spinach also fell by 12 per cent, in a clear sign that the poor weather in southern Europe has had a tangible impact on British shopping baskets.”

“Meanwhile rising prices – which we saw at Christmas for the first time since 2014 – have continued into the new year, with like-for-like inflation on a basket of everyday groceries climbing to 0.7 per cent. If prices continue to rise at the same rate for the rest of 2017, shoppers will find themselves around £27 worse off.”

Morrisons was the fastest-growing retailer within the big four, increasing its market share for the first time since June 2015 with a sales uplift of 1.9 per cent year on year. Although growth came from across the store, premium own label was a real bright spot – sales were up by 35 per cent, while its revamped The Best range made its way into 14 per cent of Morrisons baskets.

Growing for the fifth period in a row – albeit at a slower rate than previously – Tesco’s sales were up 0.3 per cent year on year as its market share fell to 28.1 per cent

Sainsbury’s sales remained flat, while its share fell by 0.3 percentage points to stand at 16.5 per cent.

Meanwhile Asda’s 1.9 per cent fall in sales signalled a decline which continues to slow.

Although its share dropped by 0.6 percentage points over the quarter, the retailer did manage to increase the number of shoppers visiting its stores compared to the same period last year.

Elsewhere, Waitrose, Lidl and Iceland all continued to grow. Boosting sales by 3.4 per cent, Waitrose increased its share of the grocery market to 5.3 per cent, while Iceland – up 8.6 per cent year on year – saw sales growth for the tenth consecutive period.

A 9.4 per cent year on year sales increase for Lidl buoyed the retailer’s market share by 0.3 percentage points, leaving the discounter holding 4.5 per cent of the UK grocery market.