Shoppers are still ditching the 'big four' supermarkets for Aldi and Lidl

Britain's big four grocers - Tesco, Asda, Sainsbury's and Morrisons - all lost market share to discounters over the last three months.

by Elizabeth Anderson
Last Updated: 28 Jul 2015

Aldi’s market share is now at a record high of 4.6%, after sales jumped 35.3% year-on-year in the 12 weeks to March 30, according to retail research firm Kantar Worldpanel.

Meanwhile rival discounter Lidl's sales rose 17.2%, taking its share to 3.4%. At the other end of the retail spectrum, upmarket chain Waitrose kept hold of its record 5% share, up slightly from 4.8% last year after sales rose 4.5% over the first three months of the year.

This left all the big four chains feeling the pinch. Tesco sales fell 3%, Sainsbury’s declined 1.7%, and Morrisons dropped 3.8%. Asda proved the most resilient, with sales slipping 0.5%.

‘All of the ‘big four’ supermarkets have faced declining sales over the past 12 weeks, which has been accentuated by the late falling of Easter. Nevertheless, they have also seen worrying share declines, with the most resilient performance coming from Asda this period,’ Edward Garner, director at Kantar Worldpanel, said.

In response, Britain’s biggest supermarkets are squaring up for a price war against the upstart discounters: Tesco committed £200m a year to cutting prices earlier this year and Morrisons recently announced a £1bn restructuring after big losses. However Tesco was last week dealt a blow by the resignation of finance director Laurie McIlwee, who said he had 'lost confidence' in CEO Philip Clarke's strategy.

Asda is currently on a £1bn investment plan to reach more customers. It plans to spend £750m this year opening new stores, and will invest £200m into lowering prices. Yesterday the company announced it would create up to 12,000 new UK shop posts over the next five years.

Aldi and Lidl have no online presence to speak of, which no doubt gives the major chains an advantage.

Still, this doesn’t appear to have hindered their progress so far. Both Aldi and Lidl plan to ramp up store expansion in the next year. It is also expected that German-owned Lidl could make a move into the US as early as 2015, following in the footsteps of fellow German brand Aldi, which has had an American presence since 1976.

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