Grocers watch sales slump despite winning supply ‘battle’

Retailers are “desperately” hoping for a Christmas boost after sales fell for the fourth consecutive month in August.

Sales from food stores dipped by 1.2 per cent, a much steeper decline than the 0.9 per cent average.

Experts believe they were hit by the lifting of pub and restaurant restrictions.

On the other hand, grocers appeared to be relatively unscathed by recent HGV driver shortages and supply chain disruption.

READ MORE: M&S food on the up while international sales dip

Hargreaves Lansdown analyst Sarah Coles told the BBC that supermarkets had fought hard “so we could keep filling our trollies”.

They led the pack of retailers who had avoided food shortages by switching suppliers.

Part of the reason for supermarket success may have been their willingness to increase pay for hauliers.

Ocado became the latest grocer to announce perks for new recruits, claiming higher wages and sign-on bonuses would cost up to £5 million.

In the last two weeks, 6.5 per cent of retailers were left with gaps on shelves, but this mainly affected department and clothing stores.

The share of e-commerce sales increased from 27.1 per cent in July to 27.7 per cent in August.

However, Kantar data shows that online groceries have reached their lowest market share since May 2020.

Fidelity associate director Emma-Lou Montgomery believes that shops hope to recoup their losses over the next few months.

“With fewer than 100 days… until Christmas, retailers will be desperately hoping to see the boost in sales that traditionally goes hand-in-hand with the festive period,” she said.

She added there were “signs of optimism”, pointing to John Lewis and Waitrose’s planned hiring spree of over 7000 workers.

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