GB market growth remains weak in January

Lucy Ingram
Retail Analyst

Date : 04 February 2020

The start to 2020 saw weak growth in the GB grocery market, with sales +0.3% in the 12 weeks to January 26th, according to Kantar. Once again shoppers committed to Dry January and Veganuary, boosting sales in some areas but not driving significant growth across the sector. We look at this in more detail and key retailers' performance during the period.

Volumes continue to fall

The slow market growth trend seen over the Christmas period (0.2%) continued into January. Despite growth being up a touch, so too was inflation (to 1.0%). This implies volumes fell by the same as last month (0.7%).

Staying healthy in January

Retailers looked to capitalise on the growing lifestyle trends that occur in January, with Dry January and Veganuary used as an opportunity to launch new products. As shoppers looked to make healthier choices following the festive period this improved the performance of certain categories, such as non-alcoholic beer and meat substitutes, however overall performance still suffered. 

For subscribers looking to find out more, read our Veganuary reports showcasing retail and brand initiatives and opportunities for manufacturers and how vegan options have developed for the on-the-go shopper and opportunities for further growth.

Ocado's growth spreads to new areas of the UK

Ocado remained the fastest growing retailer, with sales 11.2% higher than last year. Its market share increased 0.2 percentage points in the period to 1.4%.

Although the majority of its sales come from London and the South East, Ocado’s fastest growth came from the North of England where sales were 17% higher than last year.

Lidl outperforms Aldi

Both discounters continue to perform well, with Lidl achieving double digit growth of 11.1%, meaning it is now growing at nearly double the rate of Aldi.

Aldi’s growth has slowed to 5.7%, compared to this time last year when it was 9.1%.

Aldi remains committed to its rapid expansion plans, aiming to open around 50 stores a year until 2025, to reach its target of 1,200 stores in the UK. To support this growth, Aldi has this week opened its largest ever distribution centre in the UK, according to The Grocer. At 600,000 sq ft it will serve 80 stores across the East Midlands.

Learn more about Aldi at our Aldi Trade Briefing 2021 on January 26th 2021. Early bird tickets are now on sale.

Negative trend continues at the Big Four

At the Big Four the sales trend continues to be negative, but Tesco has seen the biggest improvement in its position with sales down by 0.9% compared to -1.5% last month.

The retailer has announced that Dave Lewis will stay on as CEO until September so that incoming CEO Ken Murphy can honour his contractual non-compete obligations and ensure a smooth transition into his new role.

Sainsbury’s was the best performer of the Big Four, with sales declining 0.6%.

January saw the announcement that Mike Coupe will be retiring from his position as CEO. He will be replaced by Simon Roberts in June. The retailer has also announced that it has committed to becoming a Net Zero business, investing £1bn in reducing its emissions across its operations by 2024. 

Learn more at our;

Detailed results

Retailer 12 weeks to 27th January 2019 12 weeks to 26th January 2020 Sales growth (Y-O-Y%)
Tesco 27.7% 27.3% -0.9%
Sainsbury's 15.9% 15.8% -0.6%
Asda 15.3% 14.9% -2.2%
Morrisons 10.6% 10.3% -3.0%
Aldi 7.5% 7.9% 5.7%
Co-op 5.9% 6.0% 2.7%
Lidl 5.3% 5.9% 11.1%
Waitrose 5.1% 5.0% -1.5%
Iceland 2.3% 2.3% 1.4%
Ocado 1.2%/td> 1.4% 11.2%
Other Multiples 1.7% 1.7% -1.2%
Symbols & Independents 1.5% 1.6% 3.7%


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