Lidl is UK’s fastest growing supermarket

GERMAN discounter Lidl is once again the UK’s fastest growing supermarket with a record market share of 5.3%, figures show.

Almost two thirds of shoppers visited a Lidl or its rival Aldi in the past three months, with the two retailers now accounting for almost £1 in every £8 spent in Britain’s supermarkets, up from £1 in £25 a decade ago, Kantar Worldpanel said.

Supermarket sales overall were up 3.6% over the 12 weeks to September 10 on the same time last year, the sixth consecutive month of growth of more than 3%, largely driven by grocery inflation.

However, poor weather in August hit sales of traditional summer items, with prepared salads seeing a 6% dip and sun care down 16%.

In contrast, consumers spent almost £4 million on cold treatments in August, an increase of almost £2 million on the same month last year.

Fraser McKevitt, head of retail and consumer insight at Kantar Worldpanel, said: “We haven’t seen sustained market growth of this kind since May 2013.

“A 1.5% increase in the volume of goods going through the tills has contributed to this growth while the remainder of the overall sales increase is down to higher prices.

“Like-for-like grocery inflation now stands at 3.2%, slightly ahead of the headline CPI rate and down 0.1 percentage points on last month.

“The average British household spends almost £4,200 in the grocers each year so a fall in inflation, which we expect to see as we approach the end of the year, will be a welcome relief.”

Lidl was the fastest growing supermarket with a sales increase of 19.2%, while Aldi’s growth of 15.6% took its market share to 6.9%.

Tesco’s recovery continued with sales up 2.7%, although its market share was squeezed by 0.3 percentage points to 27.8%, while Sainsbury’s market share fell 0.2 percentage points to 15.7%.

Asda attracted an extra 482,000 shoppers compared with a year ago, the fastest rate by the retailer in more than three years.

Despite announcing a fall in profits last week, Waitrose’s sales increased by 2.4% and it held on to a 5.3% share of the market, currently level with Lidl.

Figures from Nielsen suggest that the rising cost of household groceries means shoppers are increasingly turning to supermarket own-label products.

Spending on own-label items is up 5.5% year-on-year, nearly five times the growth seen on branded products.

Mike Watkins, Nielsen’s UK head of retailer and business insight, said: “The return of inflation means shoppers are increasingly turning to supermarkets’ own-label products to help manage their weekly grocery spend.

“Own-brand sales are growing across all major food retailers but fastest at the discounters – Aldi and Lidl – and at the Co-operative, Iceland, M&S and Tesco.”