Asda to grab Sainsbury's No2 place in Xmas battle

Asda is poised to seize the number two position in grocery from Sainsbury's this Christmas, transforming the supermarket hierarchy.

Leading broker SchroderSalomonSmithBarney forecasts that the new order will be cemented next year, when Sainsbury's will be pushed into permanent third place eight years after losing the number one position to Tesco.

The broker said that non-food has been the 'prime driver of top-line growth' for Asda and will help ensure the Wal-Mart-owned chain sour Sainsbury's festive spirit.

Last month, Taylor Nelson Sofres Superpanel data showed that Sainsbury's market share had dipped by 0.2 percentage points to 17.2 per cent in the last year, while Asda's increased by 1.2 percentage points to 16.2 per cent.

SchroderSalomonSmithBarney analyst Dave McCarthy said: 'It's about the seasonality at Asda. Its market share tends to peak over the Christmas period then peels off a little early in the new year. Sainsbury's could then reclaim the spot temporarily, but Asda will overtake them in the summer.'

McCarthy said Wal-Mart's buying power has helped Asda outmuscle Sainsbury's.

An Asda spokesman said: 'We are growing quickly and the gap between us and Sainsbury's is closing, but we want to continue focusing on our customers. If as a consequence we take the number two spot, obviously we'll be pleased.'

A Sainsbury's spokeswoman said: 'Asda have been saying they'll be number two for a while. It's a very competitive market at the moment. We are not going to speculate on what might or might not happen.'