Data: Grocery sales soar 7.6% amid intensifying inflation

Total till grocery sales increased by 7.6% in the last four weeks, due to an increase in food price inflation, which reached new highs of 13.8% in January.

According to new data by NielsenIQ, the decline in shopper spend reflected in the drop in volume sales (6.9%), which is the lowest volume growth recorded in over nine months, reflecting the concerns customers face due to the ongoing cost-of-living crisis.

UK supermarkets also experienced a very slow first week of January due to the bank holidays but the data indicates that the weekly value growths increased to 6% at the end of the month, which coincides with the first monthly payday of the year for many customers.

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According to the data, shoppers likely tried to shop to a fixed budget to save money and focussed on essentials, with bakery items increasing by 12.6%, dairy 11.5%, pet food/care 10.4% and frozen products 8.9%, respectively.

However, fresh produce value sales fell by 3.6%, while value sales for beers, wines and spirits (BWS) declined 4.7%.

Volume sales for meat and poultry also fell 10%.

The online share of all FMCG sales remains at around 11.1%, similar to the underlying share in the latter part of 2022, NielsenIQ stated.

Discounter grocers also continued to show strong momentum with sales growth of almost 20% year-on-year with Lidl over taking Morrisons with 12 week market share of 8.9% and 8.3%, respectively.

“We expect a challenging first quarter for the grocery industry, with inflation very much top of mind for shoppers. As a result, shoppers will continue to trade down to cheaper brands or private label products,” NielsenIQ UK head of retailer and business insight Mike Watkins said.

“In January we have seen private label sales grow in household by +16.5%, ambient grocery by +16.8% and frozen by +20.2%. Also, when consumers are cash poor, they also shop more frequently and across more retailers, because they can only afford to shop for groceries ‘little and more often’ to help manage household budgets.”

Watkins added: “This will probably continue until Easter, when family gatherings and hopefully better weather gives a boost to sales.”



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