Prices of many staple items at Sainsbury’s remain cheaper than they were three years ago, despite greater food price inflation.
Everyday purchases such as broccoli, chicken and milk are all cheaper, Sainsbury’s chief executive Mike Coupe said as he updated on first-quarter performance.
The grocer reported that it had “worked with suppliers to improve our price position versus competitors” over the period, during which Sainsbury’s grocery sales climbed by 3%.
“It would be wrong to say that there isn’t some inflationary impact,” he acknowledged.
But he pointed out that transactions rose 2%, indicating that customers saw Sainsbury’s as providing value for money.
Coupe attributed much of the strong performance to improvements to Sainsbury’s own-label offer.
Over the quarter, Sainsbury’s launched or improved 430 products and undertook 32 range reviews, accounting for 17% of its grocery sales.
The retailer increased sales through all channels including supermarkets which, said finance director Kevin O’Byrne, generated their best performance “in a number of years”.
Shoppers and Nisa
Coupe said that, despite pressure on shoppers’ disposable income, there had been little change in their behaviour since Christmas.
He said: “When customers feel their income is squeezed you might see supermarkets doing a little better as people eat in a bit more. That might be a trend we see coming through.
“We’re not seeing a massive change in consumer behaviour. Consumers are concerned about day-to-day life, like having barbecues in warm weather.”
Coupe appeared to play down talk that Sainsbury’s might buy Nisa. He said “it’s important to be alive to possibilities” but that “a lot of the time this sort of speculation comes to nothing”.