Tesco notched up sales growth of 3.5 per cent and lost market share in the four weeks to October 5, when food sector growth slowed to 5.5 per cent.
Morrisons and Sainsbury’s were winners in the period, recording growth of 10.3 per cent and 5.8 per cent respectively. Asda’s growth was 7.8 per cent, a decline on the 9.6 per cent previously achieved.
Bernstein analyst Chris Hogbin said Tesco’s slowdown was attributable to a sharp fall-off in non-food growth, which also affected Asda, and the impact of Tesco’s launch of the Discounter range to compete with fast-growing value specialists Aldi and Lidl.
Hogbin said: “Tesco reports that products form the new range were present in approximately 25 per cent of baskets last month. Assuming that the products accounted for 10 per cent of the baskets where they were present and carried a 40 per cent price discount to branded alternatives they could account for approximately one percentage point less revenue growth.”
Blue Oar analyst Greg Lawless said the 5.5 per cent market growth was down significantly on the 12-week run-rate. He observed: “With the benefit of food price inflation of 9.3 per cent, this implies that volumes are no negative across the sector.
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