Grocery sales are boosted by health drive

Morrisons' CEO David Potts is hiring 500 new apprentices
Morrisons' CEO David Potts is hiring 500 new apprentices
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New Year’s resolutions have led to healthy grocery sales, boosted by the strong performance of fresh produce for "Veganuary".

The latest data from Kantar Worldpanel showed that Tesco was the best performer out of the big four with sales growth of 1.0 per cent in the 12 weeks to January 27, closely followed by Asda with growth of 0.7 per cent and Morrisons with growth of 0.4 per cent. Sainsbury's saw sales fall by 0.3 per cent.
Discounters Aldi and Lidl continue to lead the field after 18.3 million households shopped in at least one of them over the past three months, spending an average of £204 – up £8 compared with this time last year.
With sales up 9.1 per cent, Aldi was the fastest-growing supermarket. Meanwhile, Lidl’s sales rose 7.3 per cent.
Fraser McKevitt, head of retail and consumer insight at Kantar Worldpanel, said the discounters are eating into rivals' market share.
"The discounters continue to take market share and the market is in relatively slow growth. Grocery inflation at 1.3 per cent is pretty subdued, although it's great news for customers.
"Also, three out of the big four are still growing."
Mr McKevitt said there is little evidence yet of people stockpiling food ahead of Brexit.
"A minority of people are considering stockpiling," he said.
"It will be ambient, cupboard goods if they do, but it's too early to do that yet. However, it certainly is moving up people's agendas."
He welcomed Morrisons' plans to hire new apprentices.
“Morrisons’ recent announcement that it will hire 500 new apprentices for its counters could prove a savvy move. 41 per cent of its customers already shop at the retailer’s Market Street stalls.
"It seems the retail world is dividing into those that offer few frills and the lowest price and those that offer more experience and service.
"This could fit well with Morrisons' shoppers who tend to be older and live in smaller households. They have more time to engage with shopping and tend to be less rushed."
The Kantar data showed that consumers ate 150 million more meat-free dinners last year than in 2017 while Dry January failed to stop alcohol sales growing by 10 per cent over the last four weeks.
The supermarket sector remains in growth - up 1.7 per cent compared with this time last year.
The healthy results were boosted in part by the strong performance of fresh produce for "Veganuary", but overall sales were down £1.5bn compared with December as shoppers kept a watchful eye on bills following their record-breaking Christmas grocery spending.
Mr McKevitt said: "Looking back on 2018 as a whole, one of the most notable consumer trends is the shift to a more plant-based diet.
"Today, 1 per cent of all households include a vegan, 5 per cent have a vegetarian and 10 per cent have flexitarians in their ranks. This move has contributed to consumers eating a total of 4.4 billion meat-free dinners in 2018, an increase of 150 million meals on the year before."
Cucumbers, carrots and berries in particular proved to be shopper favourites, rocketing by 26 per cent, 22 per cent and 13 per cent respectively.
Meanwhile, more than two-thirds of customers bought an item labelled Free From - either dairy or gluten free - over the past month, with dairy alternatives like plant milks making up a quarter of total Free From sales.
Just over half of households (53 per cent) bought alcohol in January. Sales of non and low-alcohol beers jumped by 79 per cent, but gin sales also increased by 23 per cent.
Figures from analysts Nielsen also show growth in fresh produce was up 1.5 per cent over the four weeks to January 26.
Shoppers spent £900m on fresh fruit and vegetables, over £27m more than this time last year.
That sent sales of broccoli up 15 per cent, beetroot up 14 per cent and blueberries up 10 per cent.
Mike Watkins, Nielsen's UK head of retailer insight, said: "The increase in grocery spend in the fresh and frozen food categories are a testament to evolving shopping trends.
"In the new year, consumers are focusing on positive diet changes which are not just healthy, but convenient, cheap and are less wasteful overall."