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UK grocery sales surge as lockdown shutters hospitality sector

By Abigail Townsend

Date: Tuesday 02 Mar 2021

LONDON (ShareCast) - (Sharecast News) - Grocery sales surged over the last month, industry data showed on Tuesday, as the lockdown continued to curtail spending in cafes, pubs and restaurants.
According to retail consultancy Kantar, take-home grocery sales rose by 12.5% in the 12 weeks to 21 February. Sales were even stronger in the last four weeks, however, when they jumped 15.1%, the fastest growth since June 2020.

Kantar attributed the spike to ongoing restrictions on the hospitality sector.

The lockdown also saw online grocery sales continue to boom, accounting for a record market share of 15.4% in the four weeks to 21 February, up from 8.7% last year. Nearly a quarter of households bought groceries online during the past month, Kantar said, with a total of 3m tonnes of food delivered to homes in the past year.

Fraser McKevitt, head of retail and consumer insight at Kantar, said: "The pandemic has now been making its mark on our lives and completely changing the way we shop for a full year.

"Various hospitality restrictions mean that we've eaten an extra 7bn meals at home since spring 2020. Office tea rounds were replaced by brews in our own kitchens, and we drank an additional 2bn cups of tea in the house this year.

"Overall, shoppers have spent 15.2bn more on groceries during the pandemic - around 4,800 per household on average, an increase of 500 compared with normal times."

Among individual grocers, Kantar said online supermarket Ocado had seen sales growth of 35.3% in the latest 12 weeks, easing its market share up to 1.7%.

Of the big four supermarket chains, Tesco saw its market share nudge 0.2 percentage points higher to 27.4% - the first gain since December 2016 - following sales growth of 13.2%. Wm Morrison saw its sales rise 13.9%, giving it a market share of 10.3%, J Sainsbury's sales rose 12.1%, to hold its market share of 15.6%, and Asda returned to double-digit growth after seeing sales grow 10.3%. It has a market share of 14.8%.

Looking ahead McKevitt noted: "In terms of the grocery market itself, we'll start to see a year-on-year decline following the anniversary of the first national lockdown next month.

"Sales will be measured against last year's record spending and comparisons will be tough. Demand for groceries is also likely to subside as the hospitality sector re-opens."

Kantar found that grocery inflation was 1.2% in the 12 weeks to 21 February. The fastest growth was in colas, chilled fruit juices and skin care, while prices fell in vegetables, fresh bacon and fresh beef.

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