Supermarket sales grow at fastest rate in five years as inflation spikes

Inflation has helped British supermarkets

Sales at Britain’s supermarkets grew at their fastest rate in five years this spring as inflation added an extra £133 onto the average household’s annual bill.

Fresh figures show that sales grew by 5pc in the UK’s grocery market in the 12 weeks to June 18, the strongest increase since March 2012. It represents a sharp turnaround from the same period last year, when sales were down 0.2pc.

Among the ‘Big Four’ supermarkets, Morrisons recorded the strongest sales performance with growth of 3.7pc, according to the research from Kantar Worldpanel. Sales at Tesco, meanwhile, grew by 3.5pc, their fastest rate since April 2012. Sainsbury’s

The market’s robust performance this period is partly down to particularly weak sales growth last year and a continuing increase in like-for-like grocery inflation, which is now running at 3.2pc,” said Fraser McKevitt, head of retail and consumer insight at Kantar Worldpanel.

Morrisons enjoyed the best sales growth of the 'Big Four' supermarkets
Morrisons enjoyed the best sales growth of the ‘Big Four’ supermarkets

“At this rate, that’s an extra £133 on the average household’s annual shopping bill, or the equivalent of seven additional shopping trips a year.”

Butter and fish are among the items most affected by inflation, with butter now almost 20pc more expensive than last year, and fresh and tinned fish now costing 14pc more.

The market has also benefitted from the recent hot weather, with sales of ice cream and cider up 12pc and 16pc respectively. The data did not include last week’s heatwave.

It comes as separate research from the Confederation of British Industry (CBI) showed that sales picked up for retailers in the year to June, with grocers performing particularly well.

The hot weather has boosted sales of certain products
The hot weather has boosted sales of certain products CREDIT:  TOLGA AKMEN/LNP

Kantar Worldpanel’s figures also revealed that Lidl overtook Aldi as the UK’s fastest growing supermarket for the first time since March, with sales growth of 18.8pc edging it ahead of Aldi’s growth of 18.7pc.

Meanwhile, Waitrose recorded sales growth of 5.3pc, its best performance since March 2012.

Overall, Tesco continues to hold the biggest share of the grocery market, with 27.8pc. However all of the big four have lost market share in the last year as Aldi and Lidl continue their growth.

Separate data from Nielsen UK found that the hot weather has helped boost soft drinks by 9.1pc, alcohol by 6.8pc and hand-held ice creams by 24pc. There was also a 35pc spike in gin sales, partly due to Father’s Day.

[Source”cnbc”]