Sainsbury's sales stack up in Q1

Sainsbury's reports a healthy first quarter, with booming online sales and lucrative smaller stores generating 1.4% in like-for-like growth.

by Rebecca Burn-Callander
Last Updated: 19 Aug 2013

Tesco’s UK revenues may be on the wane, with CEO Philip Clarke blaming a saturated grocery market for Tesco’s 1.5% fall in like-for-like sales but it seems Sainsbury’s has defied the supermarket downturn. The business has posted 1.4% like-for-like growth excluding fuel in the three months to June 9.

Its online shop is the real money-spinner of the quarter, with a 20% increase in sales. Small Sainsbury’s convenience stores have also performed well, up 16%. Today’s shoppers are spurning the schlep to the huge, halogen-lit labyrinth of aisles in favour of a few clicks of the mouse or quick dash to the local shop.

And it’s not just pints of milk and loaves of bread in consumers’ baskets. Sainsbury’s has also reported a steep rise in sales of clothing too. Gok Wan’s new range for women has been flying off the hangers – not bad for a man whose cachet has always been getting women naked…

Sainsbury’s has also enjoyed a Diamond Jubilee boost. An extra two million visitors packed out stores in the week running up to the celebrations. Who knew bunting would be this year’s biggest summer seller? Sainsbury's sold 550 miles of the stuff over the Jubilee week.

It is Sainsbury's single-minded focus on the British market, Union Jacks and all, that is helping the supermarket to thrash market leader Tesco at home. As Phil Dorrell, director at retail consultancy Retail Remedy, says: 'Whereas Tesco has become a jack of all trades, Sainsbury's has single-mindedly focused on British consumers and their shopping experience. This deliberately myopic strategy of concentrating on the UK and 'merely' delivering a positive grocery experience is working.'

And Sainsbury’s CEO Justin King seems confident that the supermarket's future looks bright too, with the Olympics and Euro 2012 celebrations promising further sales boosts for the group. ‘We remain well placed to continue to outperform the market,’ he says.

Got a few thousand Olympics-branded vuvuzelas waiting in the stock room, have we Justin?

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