Tesco and Sainsbury revival hit by rivals

TESCO and Sainsbury’s have continued to lose market share this year despite rising sales, industry figures showed.

Sales at Tesco hit £7.2bn in the 12 weeks to March 29 – up 0.3pc on the same period last year – as its turnaround continued under new chief executive Dave Lewis.

Sainsbury’s sales were also higher for the first time since August – up 0.2pc to £4.1bn – in a much-needed boost for its new boss Mike Coupe.

But both companies saw their market share fall amid stiff competition from discounters Aldi and Lidl as well as upmarket Waitrose.

Tesco’s share of the grocery market fell from 28.6pc to 28.4pc and Sainsbury’s was down from 16.5pc to 16.4pc, according to the figures from Kantar Worldpanel.

Asda and Morrisons, which make up the rest of the so-called Big Four supermarkets, fared even worse with sales down 1.1pc and 0.7pc respectively.

The report showed that Asda’s market share fell from 17.4pc to 17.1pc and Morrisons dropped from 11.1pc to 10.9pc. The combined market share of the Big Four is now down to 72.8pc – the lowest level in a decade.

Britain’s enormous supermarket sector has been transformed by the emergence of Aldi and Lidl in recent years as shoppers search for bargains.

Tesco poached Lewis from Unilever last year as it reeled from a highly- damaging accounting scandal as well as tumbling sales and profits.

Clive Black, an analyst at Shore Capital, said the industry remains ‘in the doldrums’ but added that Tesco ‘continues to stabilise’ under Lewis.

Tesco shares fell 4.15p to 246.85p yesterday and Morrisons was up 0.5p to 198.8p. Sainsbury’s gained 1.1p to 270.5p.

Aldi has overtaken Waitrose, part of the John Lewis Partnership, to become the sixth-biggest supermarket in Britain behind the Big Four and The Co-operative, according to Kantar.

Aldi sales rose 16.8pc to £1.34bn in the 12-week period – giving it a market share of 5.3pc compared with 5.1pc at Waitrose where sales were up 2.9pc to £1.29bn.

Fraser McKevitt, head of retail and consumer insight at Kantar Worldpanel, said: ‘Aldi has recorded double- digit sales growth for the past four years. Growth has been fuelled by over half a million new shoppers choosing to visit it this year.’

Rival discounter Lidl saw sales rise 12.1pc to £947m – pushing its share of the market up to 3.7pc from 3.4pc. McKevitt said: ‘The changing structure of Britain’s supermarket landscape is illustrated by two facts.

‘First, the so-called discounters Aldi and Lidl now command a combined 9pc share of the market. In 2012 the same two retailers only accounted for 5.4pc of grocery sales.

‘Second, the 72.8pc share taken by the biggest four retailers is now at the lowest level in a decade.’