DVDs are emerging as a lucrative sideline for supermarkets, with sales tipped to reach£900 million this year.
In the first five months of 2004, the major supermarket multiples generated DVD sales of£254 million, according to Buena Vista Home Entertainment (BVHE), which expects this to grow to£879 million for the year.
In the past four years, the DVD market has grown from£264 million to£3 billion, with the supermarkets' share, by volume, increasing from 6.9 per cent to 28 per cent.
BVHE, which claims to be the leading distributor to the supermarkets, has created its own trading team to work closer with the stores. This reflects the growing influence the grocers are having on the DVD industry.
The DVD market has become one of the most competitive sectors in retail in the past two years. As the likes of Tesco, Asda and Sainsbury's have become more aggressive, entertainment retailers, such as HMV and Virgin, have fought back by devoting more in-store space to DVDs.
Specialists such as Silverscreen have also emerged, while Game is testing two stores devoted to DVDs, called Pure Entertainment.
BVHE UK executive trading director Anthony Peet, who is heading up the new team, said he intended to 'ensure a greater sharing of market intelligence'.