Tesco nears growth as supermarkets sales speed up, says Kantar

The rot is stopping at Tesco and an imminent return to growth is on the cards, according to supermarket industry data, though both the market leader and Sainsbury's have lost ground to rivals.

Overall UK supermarkets are enjoying increasingly rapid growth as the year goes on, according to research by Kantar Worldpanel for the 12 weeks ending 27 March that showed industry sales grew 1.1% compared with the same period last year.

With sales up 1.2%, Sainsbury's was the only one of the Big Four supermarkets to generate growth in the period, with Tesco down 0.2%, Morrisons sliding 2.4% and Asda's sales 3.9% lower.

However, Tesco's sales declines stemmed for the fourth month in a row, with sales down by only 0.2% year-on-year, a quarter of the 0.8% decline seen a month ago and the February's decline of 1.6%.

But although Tesco remained market leader with 28.1%, it lost some ground from the 28.4% a month ago.

Sainsbury's also lost some market share to 16.4% from 16.8%, Asda was flat at 16.2% and Morrisons was down slightly to 10.5% from 10.6%.

Morrisons' sales slipped by 2.4% as it continues to adjust to a smaller store estate after the sale of its convenience arm, though this was an improvement from the 3.2% decline revealed in March.

Co-op, with its fastest growth since 2011, and the German limited assortment discounters (LADs) Aldi and Lidl all gained market share.

With grocery prices falling 1.5% on a like-for-like basis compared to the same time last year, Kantar's Fraser McKevitt said consumers were taking the opportunity to spend on more premium foods.

“While saving money on the basics, consumers are not averse to treating themselves. Premium own label sales grew by 6.6% in the past 12 weeks, well ahead of the overall grocery market.

"Aldi and Lidl are leading the way, growing their premium lines more than twice as quickly as the rest of their ranges, but we’ve seen this across the retail spectrum – from Morrisons and The Co-operative to the likes of Waitrose, whose forthcoming launch of Waitrose 1 is the latest attempt by a traditional grocer to reclaim sales from the discounters.”