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Why are supermarket sales flat?

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Supermarket

Brexit, fears of recession and price rises blamed for weak data

One-Minute Read
Wednesday, August 21, 2019 - 6:01am

Supermarket sales have failed to climb this summer despite record temperatures in July, according to new industry data.

The sector enjoyed sales of £26.9bn for the 12 weeks to 11 August - little changed from the same period last year when the football World Cup and heatwave offered them a boost.

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The big four supermarkets all suffered a drop, as discounters Aldi and Lidl continued to “gnaw at their market share,” says Sky News.

Asda, which faced a decline of 1.5%, warned as recently as last week that its shoppers were being hurt by Brexit uncertainty.

A survey of UK households by IHS Markit released earlier this week found that consumer confidence was at a three-month low due to fears of a possible recession.

However, the head of retail and consumer insight at Kantar, Fraser McKevitt, blamed the weather and price rises for the supermarket's flat performance.

The data specialist said: “The memory of last year still looms large for retailers and this summer's comparatively poor weather, combined with low levels of like-for-like price rises, have made growth hard to find for retailers.”

Not even July’s hottest day on record was enough “to shift the market into growth,” he added.

Sales at Tesco fell by 1.6% and Morrisons saw a 2.7% decline. In contrast, sales at Aldi rose 6.2% while Lidl climbed by 7.7%.

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