Grocery sector maintains growth

Sainsbury’s continues to be the only top four UK retailer to build its market share – the 21st consecutive period the supermarket has grown its year-on-year share value.

Growth figures for the entire grocery sector look to be well ahead of inflation in the period to 31 October 2010, according to a report published by Kantar Worldpanel.

Sainsbury’s market growth rate in the 12-week period to the end of October 2010 was reported to be 6.1%, taking its overall share of the market to 16.2%. Meanwhile Tesco’s and Morrison’s market shares have remained relatively consistent, with 30.6% and 11.7% of the market respectively.

According to the report, the market shares of discount grocery outlets have remained unchanged, signifying that the top four grocers continue to hold on to their customer base.

Edward Garner, communications director at Kantar Worldpanel, said: “The large customer base of the top four retailers means that they must strike a balance between price and quality.

“Low prices alone will not be enough to lure shoppers this Christmas. Sainsbury’s has hit a sweet spot with this balance and this is reflected in its continued growth.

“As retailers prepare for the festive season, the re-launch of both Asda and Sainsbury’s own-label brands will be major factors influencing Christmas performance.

“It’s also important to note that the share benefits of disposals and conversions to Co-operative, since its take-over of Somerfield, are now coming to an end and it will be interesting to see how the retailer performs going forward,” he added.

Grocery inflation, at 3%, is unchanged during this 12-week period. According to Kantar Worldpanel, this is evidence that the high level of promotions from retailers is countering the widely-reported commodity price increases.

Jane Parkinson, 15.11.2010