Supermarket sales lifted by rising prices and early Christmas shopping

mince pies
Shoppers are already stocking up on mince pies

Grocery sales have risen again with higher prices and early Christmas shopping helping the sector chalk up its 17th consecutive quarter of growth.

Food sales rose 3.1pc in the 12 weeks to October 8, boosted in part by ongoing inflation. Grocery prices were 3.2pc higher during quarter, compared to UK-wide inflation of 3pc in September.

All of the 'big four' grocers - Tesco, Sainsbury's, Morrisons and Asda - recorded sales growth during the period, continuing a strong run that started in April, according data from Kantar Worldpanel. 

But all four suffered a small decline in market share, as fast-growing discount retailers Aldi and Lidl continued to make up ground.

Aldi and Lidl together added an additional £390m in sales during the quarter, accounting for half of the entire market’s overall growth in the 12 weeks, Kantar said.

Of the big chains, only the Co-op recorded a sales fall, with turnover slipping 2.5pc during the period, in part because it sold 300 stores to McColl's.

Kantar also reported that shoppers were stocking up for Christmas early. In the last four weeks, sales of chocolate boxes hit £69m, mince pies racked up £4m in sales, the shoppers spent £1.1m on Christmas puddings.

Rising prices mean that grocers' revenues are growing faster than their sales volumes, Mike Watkins, head of insight at Nielsen, noted. In the four weeks to October 7, supermarket revenues rose 3.9pc, while the volume of goods sold went up by just 1.6pc.

“Inflation is helping supermarkets’ growth and the good news for them is that shoppers are still spending," said Mr Watkins. "Meanwhile, the good news for shoppers is that grocery inflation is still below that in other parts of the economy – such as travel and fuel – and should peak later in the year. Furthermore, retailers are likely to up their use of price-saving promotions at Christmas, offsetting some of the inflation.”

License this content