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‘Record’ Christmas sales for supermarkets aided by promotions

todayJanuary 3, 2024 6

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‘Record’ Christmas sales for supermarkets aided by promotions

Price cuts to lure shoppers helped supermarkets rake in record revenues ahead of Christmas, according to industry data.

Kantar Worldpanel, which tracks sales and prices among chains, said £13.7bn passed through tills or via websites over the four weeks to 24 December.

It took average household grocery spending to an all-time high of £477 across the month, the report said, an increase of £28 on 2022.

The research noted a 2% rise in sales volumes – a statistic that will be particularly welcomed by chains.

It said that almost a third of all spending over the four-week period was made on items with some kind of offer, up by more than £820m on the same period in 2022.

Sales by value were up 7%.

That reflected, Kantar said, the continuing influence of grocery inflation.

That declined substantially to an annual rate of 6.7% last month from 9.1% seen in November, largely due to the high volume of promotions.

There is a risk that grocery inflation ticks up slightly this month.

That is because supermarkets dramatically reversed many Christmas discounts in January last year, a factor that pushed Kantar’s inflation measure to a then record high.

Chains’ loyalty schemes and supplier pricing is currently the subject of an inquiry by the Competition and Markets Authority.

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CMA targets supermarket loyalty schemes and supplier prices

Fraser McKevitt, head of retail and consumer insight at Kantar, said: “The rate of inflation is coming down at the fastest pace we have ever recorded, but consumers are still facing pretty hefty pressures on their budgets.

“Retailers were clearly working hard during the festive period to offer best value and win over shoppers, and promotions were central to their strategy.”

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Kantar, which had warned in advance of Christmas of a slight rise in the cost of a traditional dinner, said demand was strong for most staples but some items did buck the trend.

Volumes of parsnips, sprouts and potatoes were up 12%, 9% and 8% respectively, and chilled gravy up by 11%.

Festive meats including pigs in blankets, sausages, hams and turkeys were also up by 6% collectively.

However, mince pie and Christmas pudding volumes were down by 4% and 7% respectively.

While all the established chains saw sales rise, Kantar reported that Sainsbury’s outperformed in terms of growth.

Discounters Lidl and Aldi, which have already claimed record sales, enjoyed their highest ever market shares for the Christmas period.

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